Private hospital group Netcare is at loggerheads with the Compensation Fund (CF) over the state entity’s digital online software programme (CompEasy system) used for digital lodging and electronic processing of occupation-related medical claims.
The listed company has warned if the “dysfunctionality” of the CompEasy system is not resolved urgently it may have to stop admitting patients with non-emergency occupational injuries or diseases.
Netcare has tried unsuccessfully to get the Johannesburg high court to compel the CF to comply with its statutory duties, including acknowledging receipt of claims, assessing claims, making decisions on them and paying claims within the prescribed period.
Instead, the court recommended the parties take the mediation route to resolve the impasse. At the heart of Netcare’s gripe with the CF is that due to technical problems with CompEasy the fund owes it nearly R300m.
While this frustration from Netcare is understandable, the casting out of indigent patients from private hospital beds is in no-one’s interests.
— Acting judge Vuyani Ngalwana
The company’s argument is CompEasy does not allow it and the CF to identify which claims have been accepted or adjudicated as constituting claims for occupational injuries, which claims have been approved for payment or paid and which have yet to be adjudicated or approved for payment.
In its defence, the CF said the nonpayment of Netcare claims could not be isolated to any dysfunctionality of the CompEasy system.
It said other factors were at play, including employers not registering or reporting incidents as a work-related occupational injuries and lack of training of Netcare staff on how the system works, and the company “refusing” to comply with the prescribed billing procedure.
Netcare’s legal challenge on the effectiveness of the CompEasy system was supported by the Hospital Association of South Africa, whose CEO raised concern in an affidavit about the industry’s experience with the system.
Acting judge Vuyani Ngalwana said the dispute between Netcare and the CF was not one that “is incapable of amicable resolution between the parties in good faith”, urging them to consider mediation in the best interests of employees who suffer workplace injuries or diseases.
“While this frustration from Netcare is understandable, the casting out of indigent patients from private hospital beds is in no-one’s interests. Neither is the refusal by private hospitals to admit indigent patients who have suffered occupational injuries at work,” said Ngalwana.
“It is an eventuality that a caring, responsible and accountable state in a constitutional democracy should move mountains to avert, rather than obdurately refuse to appreciate the ruinous effects of its policy choices on the welfare of its citizens. Moreover, it is not as if this is a free medical service. These employees make recurring contributions, through the employer, to the first respondent [CF] and are for that reason entitled to medical cover by the state when they suffer occupational injuries.
“That state hospitals are bursting at the seams and suffer from an inadequate supply of resources, resulting in spillovers to private hospitals by indigent patients who suffer occupational injuries for emergency medical treatment and diagnosis and treatment of prescribed minimum benefit conditions, is to my mind a result of state budget allocation and policy choices.
“Private hospitals should not have to bear the brunt of the inadequacies of state policy choices and budget allocations.”
The CF had a frosty reception at parliament three months ago with Sonja Boshoff, chair of the select committee on economic development and trade, calling on the employment and labour minister to save the CF and its sister entity, the Unemployment Insurance Fund (UIF), from total collapse.
This was after the CF and UIF briefed the committee on their annual performance plans, which showed the entities unable to recoup funds which they invested in unlisted companies, some of which were in liquidation or business rescue.
Netcare operates 49 acute hospitals and 14 mental health hospitals around the country.
The group, valued at R21.6bn on the JSE, reported profit after tax and exceptional items of R1.5bn in the year ended September 2024, a year when its capital expenditure came to R1.5bn.
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