Martin Young
Martin Young

Why do doctors hate medical aids?

We really, really do. You probably wonder about this. I’ve yet to meet any doctor in private medical practice who feels indifferent, let alone positive, about them. Sharing our reasons may offer an insight into why your doctor would prefer you to pay now please, and claim from your medical aid yourself.

Technically, it is not the medical aids we dislike — but rather the medical administrators. A medical aid is a not-for-profit fund offering insurance to its members, run by a board of trustees who make the decisions much like a company board of directors. A medical administrator is an entirely different beast, most definitely for profit, contracted by the medical aid with the task of administering its own affairs. Never mind that some medical aid trustees are directors or employees of the medical aid administrators themselves. Conflict of interest, anyone? Here I use the names interchangeably.

Medical aids should by law not spend money on items outside direct medical care for their members with the exception of the administration fees demanded by the administrators. Herein lies the problem I referred to in my earlier post, that the percentage of total members’ contributions used for administration is disproportionately large relative to the amount paid to medical professionals whose work is unarguably more important. Administrators also claim their percentage cut up front from the fund — what is left is then subject to the limitations and cuts set by the administrators. It is a relatively risk-free and profitable business model.

Medical aids are wary of doctors because we spend “their” money in a cascade of healthcare over which they have limited control. My decisions over my patients have huge cost implications for the medical aid. Any possibility of control of the decision-making process is hugely attractive to them. So they will institute limited drug formularies, insist on use of generic medications, demand motivation letters before special investigations or surgical procedures, limit the funds available, limit the number of consultations, dream up savings plans, Vitality plans — whatever it takes, all in the name of limiting costs.

I agree wholeheartedly with trying to keep the cost of medical care down. But there is a huge compromise to YOUR safety and YOUR health when those controls are initiated by third parties who do not have the required medical knowledge and do not bear the responsibility for your care. There are good examples where generic medications do not work as well as the originals. Some surgical implants are inferior to others. Some surgical techniques are easier for the surgeon and the anaesthetist, but because studies show minimal benefit for the patient, the medical aid will not fund them — like coblation for tonsillectomy. The effect of all this is that the medical aid places a direct limitation on how well I can care for my patient, how well I can do my job, and how well YOU will do under my care.

The frustration that this involves for a doctor is limitless. Medical aids employ medical advisers whose duty it is to analyse requests for treatments and to approve or deny them. That in principle is not a bad thing, but it presupposes that the medical advisers have the necessary knowledge and training to make an accurate and unbiased decision on every patient. It presupposes that they know as much as the specialist requesting authorisation. And they don’t, because almost without exception they have no specialist training or even experience in the field whatsoever.

The Council for Medical Schemes issued a directive that no request for authorisation may be turned down without direct “peer to peer” contact with the requesting doctor by a person with equal knowledge and experience. Bluntly put, this never happens.

As an example, I once had a medical aid demand a CT scan before they would authorise a septoplasty for my patient with a blocked nose. A deviated nasal septum is something you physically see, and a CT scan adds nothing to the process — it was a blatantly ridiculous and expensive request. I suggested in reply that it was my ethical duty to report the medical adviser to the Health Professions Council of South Africa as being so impaired as to be incapable of giving safe medical advice. The operation was approved immediately without a CT scan.

Luckily we’ve moved beyond the days when medical aid call centres tell our patients we are “overcharging’ them (who the hell are they to decide?). The same centres still say that they pay “100%” of accounts (without explaining it is 100% of their rate, not ours), or tell our patients that they will have to leave our towns, for surgery under another specialist in another town, because that is where the only authorised hospital for that medical aid is, unless “our” patient bleeds after the operation that we haven’t done, whereupon it will be our job to save his/her life as the closest surgeon. We doctors who do not sign “designated service provider” agreements are not paid for work directly into our accounts — a much cheaper process for the medical aids. The patients are paid directly, with the express intention of adding to our bad debt. It is explicit and coercive pressure to sign these agreements. Another good word would be “blackmail”.

For every case where a medical aid does step up and make a massive difference there will be a dozen events where patient care is made difficult. In every medical consultation there is a dispassionate, unqualified third party involved acting as judge, jury and sometimes executioner.

It’s not a new discovery to doctors. We’ve seen it all before, and it is getting worse. Our anger is rising, as seen in this letter which arrived as I write these last words. But to the patient in front of us, to whom we have to say “sorry, can’t help” — that discovery is awful.

That a medical administrator market leader should use the same name is nothing but ironic.


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    • OneFlew

      Let’s consider the elements. Medical insurance is, I think we will agree, a good thing. It allows pooling of risk and spreading of costs so that the patient can afford expensive procedures. This requires administration.

      It is intrinsic to insurance that boundaries and costs are vigilantly guarded: there are many examples from across the world of fraudulent or inflated claims, in medicine and elsewhere. And many more examples where there is no overt wrongdoing but where costs are not well managed.

      As you pointed out in an earlier post, doctors are not immune to the lure of filthy lucre and the structure of incentives. (In your example, the system operated perversely to incentivise doctors to perform more procedures.)

      Insurers are better than individual doctors in that they have a wider view of the landscape. Some hospitals are preferred for certain services (because they are better, more cost effective, more specialised – whatever). The same debates take place in national health systems such as the NHS.

      Individual doctors are better in that they often know their area of specialisation better than insurers’ decision makers. And they always know their patients better.

      Given the space, and being human, doctors will operate their fiefdoms based on their own priorities. But the greater good isn’t secured this way: it does require some form of pooling, marshalling and financial oversight.

      So cooperation is key.

    • michael

      Martin, you have presented one side of the coin, but my overall experience of your industry is that medical professionals are astute business people and less astute in their field. You are all fighting for a cut of the pie and the public is ultimate screwed.I will not bore you with countless examples to support my argument but will gladly do upon request.

    • Momma Cyndi

      “A medical aid is a not-for-profit fund”
      … I wouldn’t bet on that. They seem to have an awful lot of very expensive assets and very rich ‘management’.

    • Mike Blackburn

      Martin as you know I’m a specialist anaesthesiologist. I agree with all your points here. The medical advisors generally have a fair idea of what is going on. Occasionally they are blinded by their own prejudices and training. One medical aid(scheme) in particular refuses to pay for an anaesthesiologist for colonoscopies. This is because their advisor is a surgeon who believes in 1994 guidelines and not in the current sedation guidelines.

      Founders lie to patients by telling them that their specialist accounts will be paid at 100% when in fact, 100% does not exist. 100% of what?

      Thirdly, the business of paying patients for claims submitted by doctors is, if I may use stronger language than you did, nothing short of fraud. Almost ALL of my bad debts are related to this, my account has been paid, IN FULL to the patients who then abscond with the funds.

      Additionally, the ducking and diving that occurs around PMBs is completely unacceptable. As an anaesthesiologist I have NO control over who is presented for surgery, so why do they reject claims based on where the procedure was done.

      In short, as I’ve said before, to call them medical “aids” implies they are there to help. To me, “scheme” is a better moniker.

      And before someone attacks me for my billing practices, check how much it costs to have a plumber, I paid almost r2k for <1hr.. I have 14 years of medical experience, and these schemes want me to earn a percentage of that.

    • Garg Unzola

      I hate medical aids too. I need the application of a certain skill that a doctor possesses. I want to go to any doctor of my choosing, I want the medical aid – also of my choosing – to pay for it. If they don’t pay for it, or if they are only willing to pay what the government says they must pay, I would rather not deal with a medial aid at all. Even if I have to pay first and claim back later, I prefer not dealing with a medical aid.

      I don’t think medical insurance or medial aids are good things at all. They simply cannot keep the cost of medical care down when they in effect subsidise medical care. They can only bring the cost of medical care up, since they fix prices and they are another middle man not directly related to health care.

    • Rob

      Michael, on behalf of my profession I am insulted by your claim that our business acumen takes precedence over our professional ethics. A popular view of the professional medical world is that the advent of medical aids gave us a free hand to inflate our expenses and investigate and treat unnecessarily. This viewpoint, punted by the medical aids themselves, (certainly not the patients involved) could not be farther from the truth. Investigate and you will find that the vast majority of doctors, both GPs and specialists, are more concerned about cost to the patients that the patients themselves are. This is balanced against the need to treat the patient properly, with the best and most effective treatment modalities available. Your claim that we are all “fighting for a cut of the pie” is a myth: there is no pie.

    • Michelle

      This is a most thought-provoking article however, I tend to agree with Michael that it is indeed Doctors themselves that have allowed this situation to flourish. My view of the medical fraternity is a poor one – based on countless examples. I’m not convinced that any of them act in the “interests of the patient”. With that said though, I agree with many of your sentiments surrounding medical administrators who I can only liken to vultures.

    • born2bJaded

      Martin, I know what you mean. My old man was a GP (private) and surgeon (public). I used to handle all his admin work for him from the medical aids. I’ve seen how the industry has changed drastically, and what the med aids have effectively done, is replace the gatekeeper (GP), with, as you say, this “medical adviser”. It’s all a screw up – I am incredibly fortunate to not have to belong to a medical aid. It’s one of the few things my old man insisted I do, when I left for Jozi to work; DO NOT buy into medical aid. Take that money, and put it in savings, and NEVER EVER touch it. That is a sad state of affairs. At the end of the day, it comes down to who you would prefer to screw you – the med aids (which they do as a matter of business) or your doctor (who may or may not). I’ll put my faith in the medical PROFESSIONAL every single time thank you.

    • Passerby

      On the one side of the coin:
      Could I add to the fact that, while the peer to peer contact (often extremely difficult to accommodate from a medical scheme perspective due to various “operational” standard procedures implemented at the medical schemes) could be considered mandatory, we understand that it often is physically not possible (not enough specialists, scheme unwilling to obtain specialist, nay, peer opinion, etc.). That part of the Medical Schemes Act overlooked then.
      On the other side of the coin:
      When an account is submitted outside of the allocated submission period (about 4 months from date of service), it is deemed “stale” and often not reimbursed by the scheme.
      The applications of the various Acts do not consistently apply to the responsibilities the scheme has to the point of specialized (pun intended) frustration. Additionally, medical schemes are embarking on Forensic Audits and own the right to recuperate money they deemed they have erroneously paid to the practice for periods up to 2 years. Conversely, where practices have claimed less than the scheme rate over the same period, and would like to recuperate the portion of the money that could now be considered outstanding or debit, it borders on mission impossible.
      Numerous similar disparities in the application of the various Acts can be referenced. (PMBs, payment at cost, managed care interventions, etc.)
      I wonder why it is called a “scheme” – lookup the definition. Ciao.

    • Momma Cyndi

      Your article has resulted in quite a bit of debate within my circle of friends. Various anecdotes of the horrors of dealing with medical aids along with a few about doctors covering up for other doctors incompetence.

      One friend pointed out that every single medical act was ‘elective’ as you always have the option to die instead. She was wondering when the medical aid was going to use that excuse.

    • Sarel Botha

      How about doctors offer the patient the option of paying cash at good discount and then the patient claims this back from the medical aid. problem solved.

    • mika venter

      You left out the private hospitals, they are the biggest culprits in this supply chain.
      But then it cost me R6000,00 to find out I had Bilharzia due to GP’s incompetence. Not just one but a 3 of them and the countless blood test I had to do. And the blood test added up a big portion of that money.
      Dr’s are as quilty of the high cost as the scum bag medical aids and private hospitals.

    • Medical Aid SA

      I would say that the best solution to this problem is for medical aid schemes to evolve into entire financial companies, with their own hospitals, doctors, pharmacies and so forth. This means that the doctor working there will automatically have the authority to treat a patient to the extent that he or she deems adequate. If medical aid schemes could each obtain a premises in which they could each have their own line of medical care institutions, it would be much easier for the patients as well as for the medical care providers. This is, of course, wishful thinking, so the second best option is for all medical schemes on each continent to join and open a line of financial care institutions (franchised and or profitable if it must). What do you think Martin (Author)?

    • Delia Ann Kennedy

      Another angle to the story is that medical aids now market themselves as shiny commodities, leading ordinary folk into regarding medical aid and any kind of medical treatment as a sort of status symbol. I work in an environment where there are dozens of people over 60. They tell one with pride how they are going for a knee replacement, an injection in the eye, a colonoscopy, a triple bypass, and so on. They talk about their medical aid as if they are dealing with a difficult uncle who really deep down loves them and wants to help them. My younger friends are happy as anything when their child needs a grommet in the ear or some rather frightening sounding procedure, with Discovery footing the bill, of course. The rapacious side of medical aids — the administrative process and the marketing of medical aids — must be changed. South Africans are beginning to believe that bad health and using your medical aid is a sign of prosperity. That’s putting strain on the medical aids and making their cost-cutting measures worse. Medical aid is not a funfair. It’s insurance.

    • Candice

      Absolutely agree! its always claiming thats the issue, and it goes both ways for both the doctor and the patient. I’m not sure about other private practitioners, but my doctor prefers medical aid payment, but it depends on each GP I suppose and the experiences they have add with companies. It is important to have medical aid though, especially in these times in South Africa. I found an article that highlights some reasons why medical aid is needed.