Discovery again defends accident fund pay-out policy

Following a barrage of inaccurate information shared on social media Discovery Health again defended its policy on Road Accident Fund (RAF) pay-outs. “In response to inaccurate statements being shared on social media regarding how Discovery Health Medical Scheme pays claims for motor vehicle accidents and refunds from the RAF, we would like to provide the correct information,” the scheme said in a statement last week.

Discovery Health recently said that any members who have had medical costs paid for by the medical scheme and have received funds from the Road Accident Fund (RAF) must reimburse Discovery Health.

The medical scheme has highlighted that members have full cover for any claims related to a motor vehicle accident but that once the RAF pays out it must be refunded the money. Claims are paid out in line with the medical aid option that the member has, as well as with guidelines laid out by the Prescribed Minimum Benefits (PMBs). “Discovery Health settles claims as soon as they are received, including those resulting from motor vehicle accidents,” said the medical scheme.

According to the RAF, the claimant’s pay-out is intended to pay for past and future loss of income, past and future medical expenses, as well as general damages. In addition, dependants of a deceased person can claim for past and future loss of support and funeral expenses.

What if your medical aid has already covered the costs?

If your medical scheme has already covered the cost of your treatment, Discovery Health stressed that any money paid out to the member by the RAF must be used to reimburse the medical scheme for the cost of treatment.

“If members decide to institute claims against the third parties responsible for sustained injuries, this is their own decision. Should the RAF pay out for medical expenses already paid by the scheme, members are then required to refund these claims to the scheme. The Council for Medical Schemes* has ruled unequivocally in favour of the Discovery Health Medical Scheme on this issue, concluding that the scheme is entitled to claim reimbursement of medical expenses paid in respect of RAF matters. This is in accordance with the Scheme’s rules and in terms of common law principles,” revealed Discovery Health.

However, Discovery Health emphasised that it does not force its members to initiate the claims process with the RAF. However, some reports claim that clients have been approached by Discovery to claim from the RAF and then reimburse the scheme. “Where the Discovery Health Medical Scheme becomes aware that a member has instituted a claim and has been paid out, the Scheme will request that the member reimburses the scheme for medical expenses paid on the member’s behalf.”

The RAF noted that whether a person is required to refund his or her medical scheme the money paid out for medical expenses, “depends on the rules of the particular medical scheme, which rules vary between different medical schemes.”

Can you keep the money for additional treatment?

Dr Jonathan Broomberg, CEO of Discovery Health, explained: “The member cannot use any money paid by the RAF and owed to the scheme for any additional treatment. Such funds must be paid directly back to the scheme concerned. Should the member require additional treatment after the RAF award is made [for example for rehabilitation], the RAF may issue a certificate of undertaking to cover future expenses, however, should no certificate be issued the member will be required to claim for such treatment directly from his scheme subject to his chosen benefit plan.”

How long does it take for a claim to be approved and paid?

The RAF highlighted that the time taken to approve or deny a claim will vary according to the facts of the case. For example, it noted that a funeral expenses claim will generally be settled faster than a loss of support claim, as this is usually less complicated. However, this can sometimes be reversed, as the length of the process depends on the specific facts of the claim.

There are two ways that people can claim from the RAF. You can either hire a lawyer and lodge the claim through them (represented claim), or you can lodge directly with the RAF, who will provide assistance to the claimant (direct claim).

For the financial year 2015-2016, the RAF noted that the average age of an open direct claim was 698 days, while for a represented claim it was 1 196 days. The process time from lodgement to settlement is 944 days for a direct claim, and 1 701 days for a represented claim. The RAF explained that the difference in time was due largely to litigation.

RAF fraud affects medical schemes and their members

While some people may unintentionally enrich themselves through the claims process, Discovery Health noted that there is another concern. In some instances, unscrupulous attorneys are benefiting from the RAF claims process at the expense of the medical scheme and its member.

This is done by charging excessive legal fees to the claimant. Discovery Health added that this can have a “significant negative impact on members who have in many cases suffered serious motor vehicle accident injuries.”

According to Discovery Health, it spends about R120 million per year on medical expenses for which the RAF is liable. It pointed out that this figure is only for the cases that it is aware of.

“In addition, a substantial number of claims are not payable by the RAF due to lack of merit,” stated the medical scheme.
In instances where members have been victims of fraud (such as overcharging), Discovery Health will assist. According to Discovery Health it is concerned over the number of members who have been charged excessive legal costs with regards to legitimate claims against the RAF.

“Discovery Health is currently assisting Discovery Health Medical Scheme members to lodge complaints with the Law Society of the Northern Provinces against attorneys who are committing fraud by overcharging their clients. We believe we have an obligation to assist and protect our members, particularly those that find themselves in a vulnerable position. We also believe we have a duty to defend the integrity of the broader structures of our society, in this case the RAF,” noted Discovery Health.
 
*The Council for Medical Schemes had not commented by the time of publication.