Medical Aid members are bearing the brunt of healthcare fraud across the length and breadth of the industry. While various players in the legislative and public arenas hold extended debates with regards to the source of cost escalations in the medical aid industry, medical aids and their administrators continue to fight an ongoing battle to deal with a minority of unscrupulous members, and service providers who are costing the industry between R4 and R13 billion every year through fraud.  It is estimated that up to 15% of all medical aid claims are fraudulent according to market research within the industry.


This trend is reinforced by an environment that is conducive to fraud with traditionally little visible policing, a weak legal system and, relatively ineffective industry governing bodies.  Fraud is prevalent across all aspects of the medical aid industry, including providers and members, with some members viewing medical aid as a grudge purchase and looking to gain advantage at the expense of their medical scheme. This drives up administration costs and claims, which inevitably lead to higher contribution increases and negatively impacts on the financial stability of the scheme.


HEALTH SQUARED believes that a retrospective approach to fraud management is not the answer and pre-emptive initiatives prior to settlement of the claim should be the focal point of fraud elimination within the sector. Members and service providers should be treated with the benefit of the doubt as many fall within a “grey” area of inappropriate claims behaviour which could be based on a lack of knowledge as opposed to willful fraudulent behavior.


The HEALTH SQUAREDapproach to fraud management and reduction is focused on monitoring claims behaviour patterns amongst members and service providers and identifying suspect role players in their infancy in order to better address these concerns promptly with corrective action. This is done through our administrator, AgilityHealth’s, unique technology which automatically red flags inappropriate claims and suspected risk patterns and provides comprehensive information required to take action and investigate possible fraud. This technology has dramatically impacted in lowering fraud within the Scheme.


The worst perpetrators of fraud are providers who are most often guilty of:

  • Submitting fraudulent or phantom claims, with or without the member’s knowledge. 

  • The “ATM” factor where there is collusion between members and doctors 

  • Incorrect prescription submissions

  • Unbundling or bundling of treatment codes

  • Code farming 

  • Over servicing


How members can help prevent fraud:

  • Pay close attention to your medical aid statements for irregularities

  • Ensure the medication you receive from your pharmacy is what was prescribed (pharmacies and dispensing doctors have been known to dispense generics and then claim for the costlier branded product.)

  • Check that the diagnosis code on the claim is the same as what was provided to you

  • Check that the medical file you are signing is in fact yours – ensure all details are correct

  • Ask questions – do I need these blood tests, procedures, is there another way of getting the same results

  • When in doubt, contact us immediately


It’s the responsibility of every player in the industry to assist medical schemes in combating fraudulent activity. This is particularly true for members as they are directly affected by the consequences of rampant fraud and provider ignorance as the costs of fraud ultimately impact on the affordability of private healthcare as a whole. Thanks to HEALTH SQUARED and AgilityHealth’s principles and technology, you can rest assured that every effort is made to monitor and identify irregularities to ultimately ensure we can provide you with benefits and services that mean you’re covered from every angle.