The Importance of Causal Inference – Medical Scheme Racial Bias Allegations

The Importance of Causal Inference – Medical Scheme Racial Bias Allegations

by Platinum
(106,910 points)
posted in Business Dec 15, 2021


The struggle against racism ought to be data-driven, at least


South Africa’s apartheid system was or is the epitome of racism. It was a system that stripped the black person of their dignity. The 1994 declaration of freedom (not independence) was supposed to usher in a new dawn, a new dispensation that guaranteed true freedom for every inhabitant of the country.

Many non-white people especially the black community feel that not enough has been done to rid the country of the remnants of this evil system. As suggested by the Julius Malema led Economic Freedom Fighters (EFF), the 1994 transaction was cosmetic and did not empower the black person to thrive and be the master of their own destiny. Many in the African National Congress (ANC) and the Democratic Alliance (DA) will dispute the EFF claims and point to the emergence of the “black diamonds”, a black middle class that did not previously exist.

This article focuses on the racial bias struggles of black professionals in the work place as typified by the claims by black medical providers. Many “black diamonds” in corporate and entrepreneurial settings report that they have been prejudiced by the unchanged discriminatory system. They claim that 1994 was a conduit to a more subtle form of apartheid that was pivoted on further economic control by the white minorities. Some disgruntled black professionals have even gone to the extent of accusing Nelson Mandela of selling out at the negotiating table. Did black South Africans get a bad deal?

It is my belief that these accusations should not be ignored. Has corporate South Africa truly transformed? Is racism still as bad as it was pre-1994? Has the economic system changed? What needs to be done in order to address this issue?

Recently, I received the Section 59 Investigation report summary on racial bias in fraud, waste, abuse (FWA) identification and outcomes in the medical insurance sector. This report is as a result of the submissions of racial bias of medical schemes against Black and Indian medical practitioners. The investigation was established in terms of Section 7(a)(b)(c)(d), 8(a) and (k) and 9(2) of the Medical Schemes Act, 131 of 1998.

I was excited as I read the report and this led me to search the length and breadth of the internet to find the arguments made by both the medical schemes and black medical practitioners. It was with great relief when I realised that the Adv Tembeka Ngcukaitobi-led commission had done a sterling job of documenting all the submissions for public consumption on

The high-level investigation outcomes were as follows:

  1. Some of the current procedures followed by medical schemes to enforce their rights in terms of section 59 of the Act are unfair. The commission also found that Black providers are unfairly discriminated against on the grounds of race.
  2. The commission stressed that they had not found evidence of deliberate unfair treatment – the evidence shows the unfair discrimination is in the outcomes. The Constitution regards the form of unfairness that they found to exist as constituting unfair racial discrimination.
  3. The commission did not have power to find anyone guilty. Nor were they appointed to investigate the veracity of each individual claim of unfair treatment and unfair discrimination. But they believed that they would be failing in their duty if they ignored degrading, humiliating and distressing impact of racism against the individuals who testified before them. A part of their function was to provide a platform for the expression of individual experiences of racial discrimination and other forms of unfair treatment.
  4. The commission does not believe that they have covered each and every possible complaint of medical providers against schemes. Their mandate was not exhaustive thus they cannot claim to have explored all possible manifestations of racial discrimination and unfair procedures. But they received sufficient data and information to make informed and reliable conclusions of the patterns of conduct by the schemes.

Given the submissions and the investigation report, it dawned on me that, in as much as the verdict that there was racial discrimination in the outcomes of FWA processes, the submissions by the medical practitioners and their representatives were not good enough.

It is my view that the commission had to stretch itself as much as possible to try and help the medical practitioners make their point of racial discrimination. Given the submissions, I was pleasantly surprised that the commission actually concluded that they had found racial bias in the medical scheme processes. The black man in me was very happy with the outcome but I quickly thought about how we can implement measures to avoid such weak submissions in the future.

The submissions by black medical practitioners through forums like Solutionist Thinkers, Independent Community Pharmacy Association among others were not data-driven. Their submissions lacked the rigour required to revolutionise the industry. I believe that the testimonies of the medical practitioners appealed to the humanity of the commissioners thus their conclusion.

I expected better quantitative and qualitative research to prove beyond reasonable doubt that there is racial discrimination in the FWA process. The burden of proof was with the medical practitioners thus it was a no-brainer that they should have gone for the jugular with their presentations. No stone should have been left unturned.

Being black, I am not oblivious to the existence of racism in its overt and covert nature. I am a victim of discrimination in its many ugly forms.

I know that if I try to buy a house in some leafy suburb of Cape Town or Johannesburg, I am most likely to be charged more than white buyers. I know that my white colleagues who do the same job as I do or are even subordinates are likely to get paid more than I do. The problem I have with these lived experiences of mine is that, there is no data to use in addressing this. It is true but it is tough to argue for in a court of law.

The black medical doctors suffered from the same deficiency in their submissions. They feel they have been racially profiled but do not have sufficient data, both quantitative and qualitative to bring about the necessary change needed in the sector.

On the other hand, the medical aid schemes had troves of data and hired experts to craft science-backed submissions which can stand stress tests in a court of law. I must say the submissions by the medical schemes focused too much on the quantitative and data analytics but were void of the qualitative and humane approach.

My argument in this article is: Black people have to do more in collecting, analysing and presenting racial discrimination data.

As black people, we have to build robust knowledge bases to complement our current efforts in fighting racism. We have to be evidence-driven in our approach to fighting for justice.

I know our ancestors relied on oral tradition to transmit information but it is our duty to supplement that with properly researched documents that are accessible to all. I believe the lack of records contributed a lot to our colonisation.

There are too many unanswered questions that I believe the medical practitioners could have used in their arguments. In my mission to help, I have listed a few:

  • Given that the PCNS database does not use demographic variables like race, how did the medical practitioners qualify/quantify the statement that black providers were being targeted? (At least the commission through Dr Zaid Kimmie constructed a racial classifier using surnames)
  • In their submissions medical practitioners did not prove the correlation or causal link between race and FWA outcomes.
  • The medical practitioners did exhibit an understanding of the structure of medical aids. They referred to medical aids as “white-owned”, which is contrary to the fact that medical aids are non-profit organisations that are voluntary associations owned by the members. They should have been armed with this information and used it to forward compelling arguments, instead they gave arsenal to the medical schemes to accuse them of ignorance.
  • If Discovery is a monopoly, have the medical professionals written evidence-driven research papers and also submitted their concerns to the relevant authorities, in this case, the Competition Commission for adjudication? From the publicly available documents, there is no evidence in the submissions. (I stand to be corrected).
  • The accusation that, “If one investigates, then the others follow”, can easily be proven a case by case time series analysis. Did the practitioners provide compelling evidence for this hypothesis?
  • The medical practitioners could have done a better job at supporting their claim in the submission that, “The system disadvantages ethical practices”. Until supported by evidence, it is a spurious allegation.
  • Last time I checked, South Africa is a free country and the constitution emphasises on freedom of association, thus I baffled by the statement in the providers' submission that says, “We are coerced to join medical schemes”.
  • Did the medical practitioners request data on the distributions of fees for certain functions to see if cases of "charging too much" were within 3 standard deviations from the mean, assuming the medical schemes use that dispersion measure to detect outliers
  • Have the medical practitioners asked for inclusion in the drafting of remedial actions when FWA accusation is made? They could propose alternative requirements when it comes to proof. Currently medical schemes require things like clinical notes, files, proof of purchase and others.
  • The laws of this country are clear that medical practitioners cannot be forced to acknowledge debt. This is something that every practitioner should be talking to their lawyers and making sure that every transactions with the medical schemes is above board.

Now that I have made my points about the weaknesses of the medical practitioners’ submissions, I now want to look at the commission’s analysis as presented by Dr. Kimmie. I do not envy him for the task that he had in this commission.

Given the poor submissions by the medical practitioners, he did well. The only technical report that I have is the one he published on the 19th of November 2019 and am not sure if there was a subsequent report that incorporated the feedback from the various medical schemes.

Dr. Kimmie did a good job of taking the very broad brief and narrowed it to two specific questions. The initial brief was:

Assist with the interpretation of the algorithms and data used by the various medical schemes and administrators to identify Fraud, Waste and Abuse (FWA) among medical service providers.

The revised brief was:

  1. Is there an explicit racial bias in the algorithms and methods used to identify FWA?
  2. Are the outcomes of the FWA process racially biased? In particular, were Black providers identified as having committed FWA a

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