Govt 'lacked political will' to deal with Psemas abuse
09 April 2019 | Government
The medical aid scheme provides cover to government employees who pay the minimum price of N$240 per main member and N$120 for dependents for up to 95% of their medical aid expenses incurred.
The source who spoke on condition of anonymity says the scheme has seen millions been siphoned off from government coffers.
According to the source, government did not act on the recommendations given by forensic experts. In addition, the reports were also not made public.
A report in possession of Namibian Sun indicates that the finance ministry knew as far back as April 2010 that there were major gaps in the fraud management system regarding claims managed by the fund administrator, Methealth. It had also received a list of suspect doctors, clinics and pharmacies that had submitted questionable and false claims, along with risk analyses. The ministry was also advised to urgently appoint a board of trustees to manage the fund effectively.
The 2010 report, in excess of 100 pages with spreadsheets, graphs, statistics and a detailed list of service providers under investigation, appears to have been ignored.
Commissioned by the finance ministry in October 2008, South African-based Savvy Solutions was appointed as independent consultants to Psemas to “focus on forensic audit investigations aimed at identifying and curbing irregular claims activities within the scheme to reduce costs and financial losses from fraud.” They inspected Psemas services providers for the period 2007 to 2009.
“Although forensic reports identifying corrupt practices were provided already several years ago which highlighted areas and parties of abused, the political will never existed to address these matters and reports were filed in confidentiality,” the source told Namibian Sun.
Finance minister Calle Schlettwein earlier this year said a forensic audit was being prepared.
“The forensic audit into the operations of Psemas is progressing to finality and we will leave no stone unturned to bring to book any identified fraudsters,” said Schlettwein during a staff engagement last week.
The findings of the audit will be revealed in due course, he added.
“There are issues that we need to look at. It is not just one or two practices, but tens of practices where serious issues have been unearthed,” said Schlettwein.
An International Monetary Fund (IMF) report titled Financial Risk Statement said that government was losing over N$900 million per annum in wastage, fraud, collusion and theft, it was reported.
The IMF report said the medical aid fund heavily relies on taxpayers' money, with about 85% of benefit payments funded through the national budget, while employees contribute a flat rate not linked to their salaries, covering 15% of total benefits.
The IMF advised the government to take several measures to save the troubled medical aid fund, such as linking workers' contributions to their salaries.
Schlettwein had recently during a meeting with stakeholders in the medical industry gave his take on the way forward for the beleaguered medical aid scheme.
Schlettwein at first quashed the reported amount of N$900 million that is said to be lost by government on a yearly basis.
“There were publications on a leakage draft IMF fiscal report alleging that an amount of N$930 million was defrauded on the scheme per annum. Such an allegation is baseless, as there is no evidence pointing to such an amount,” he said.
He said last week fraudulent activities relating to the scheme are re-emerging, despite government's crackdown recently, adding the “rotten apples” must be dealt with at all costs.
Highlighting the extent of the fraud, he said “everybody was found with their hands in the cookie jar”.
“We must save Psemas; it may have to be abandoned if it can't be saved. We believe a collaborative (effort) is the best way to determine how the scheme is run in the future.” The finance minister pointed out the money one spends on one case of beer is equivalent to your Psemas membership fee for the higher option, while two six-packs of beer is equivalent to the fee for a dependent.