The misuse of health insurance coverage in the UAE is pushing up costs that lead to fewer benefits and/or higher premiums for the companies and for the insured person who makes a co-payment, reveals a report published in the February edition of 999 Magazine – the official English monthly of the Ministry of Interior.
The region may be losing more than Dh3.67 billion ($1 billion) on health insurance abuse or fraud, Daniel Whitehead, MENA Region Healthcare Lead for consultants Booz Allen & Hamilton, told 999.
In a survey of 450 respondents conducted by 999, more than a quarter (28 per cent) affirmed that they have experienced being advised and billed to undergo unnecessary tests that only inflate the bill.
It also showed that 81 per cent of the respondents had medical coverage, and more than half know of a person who files sick leaves even if they are not sick, while 49 per cent know a person who has used fake medical certificates, confirming that the misuse of sick leaves is a common practice.
Based on studies conducted by insurance companies in 2011, misuse accounts for 30 per cent of health insurance spending, and this fact is raising alarm-bells all over the country.
This gaping hole in expenditure is the main cause of higher premiums, which in turn scare off many employers, the ripple effect of which is ultimately felt by workers who either miss out on coverage completely or are afforded lesser quality health insurance.
The UAE’s healthcare sector is booming, with a projected 271 per cent growth by 2015, up from $3.2 billion to $11.9 billion; and hand in hand with that growth comes the rise of health insurance, a benefit that all nationals and most employed expatriate residents get.
The flipside is that the misuse of this health coverage means healthcare benefits for UAE citizens and residents are being eroded in value by unethical and fraudulent claims.
The cost of paying out unfair claims is ultimately recovered through higher premiums – fraud and misuse, therefore, rob those who really need the cover. It was reported that thousands of workers in Abu Dhabi might have their health benefits cut as employers were looking to manage premiums that had gone up by about 20 per cent.
Daman has 2.1 million members, representing 80 per cent of Abu Dhabi’s health insurance custom. Chief Commercial Officer Dr Sven Rohte said, “We recognise that fraud exists here. We have a dedicated audit and investigation team, all with medical backgrounds, who look at suspicious claims and also follow the claims trend from medical service providers for any irregularities in billings. Last year, the team audited 500 medical services providers and investigated over 1,000 claims.”
Whitehead added: “As rates increase, it would be surprising if there were no pressure on employers to cut back on benefits in order to maintain their profitability.” The cost of fraud, he said, was astronomical. “Simple structural changes in reimbursement and claims processing systems can prevent millions in payouts for exaggerated services.”
One challenge is ensuring that fraud is seen as the crime it is, rather than just a little mathematical tweak here and there that no one will notice. Laws are in place, but Dr Rohte said: “We noticed that, in general, the acts of misuse or health insurance fraud are not perceived as a crime. For example, one would ask a pharmacist to exchange the drugs in their prescription for diapers (to the same value as the drugs) and bill the insurance company for the cost. We are, therefore, working to raising the awareness on fraud and abuse.”
Whitehead agreed that the perception of insurance fraud as a soft offence added to the problem of curbing it. “For instance,” he said, “the simplest and perhaps the most pervasive fraud schemes are system exploitations such as ‘upcoding’ in which otherwise honest providers adjust their billing to maximise payout.”
Other sneaky ways include over-prescribing medication and duplicate billing, where the same procedure is paid for twice. Insurers and regulators warn against over-prescribing of medicines for both financial and medical reasons.
Lt. Colonel Awadh Saleh Al Kindi, Editor-in-Chief of 999, said: “Exploitation is seen in the health industry, where the dishonest practices of a few take vital health cover away from the many who need it. We refer to false claims, whether by patients or health service providers, pushing up the cost of insurance. In this issue, we look at the health insurance industry to pinpoint responsibility for this corruption. We encourage everyone to be vigilant and report any misuse and abuse to UAE authorities so that we can help each other in protecting ourselves as well as the premiums that either we or our employers pay.”
The English 999 magazine is a part of the Strategic Plan of the Ministry of the Interior to provide media coverage for the activities and efforts of the Ministry and Abu Dhabi Police. It also aims to encourage the public to contribute to the reduction of crime and enhancement of safety in the UAE.
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