Insurance companies have terminated services of at least 30 health service providers over allegations of fraud.
In notices issued yesterday, medical insurance service providers notified their clients that they had terminated the services of about 30 health services providers with immediate effect.
The termination culminated from an investigation in which Uganda Insurers Association (UIA) found that some health services providers were engaged in fraud.
Mr Paul Kavuma, the UIA chairman declined to comment on the matter referring Daily Monitor to an earlier statement in which Uganda Regulatory Authority said there had been an increase in fraudulent insurance claims.
However, no details of the alleged fraud were provided and it remains unclear whether UIA will seek further sanctions against the companies.
Ms Mariam Nalunkuuma, the Insurance Regulatory Authority senior communications manager, yesterday said the termination was a step in the right direction towards combatting fraud in the insurance sector.
“IRA does not regulate health service providers. What happens is insurance companies identify them to provide treatment to their clients. If insurance companies find problems with a health service provider, it can decide to terminate. This has happened in the wake of fraudulent cases reported to IRA and UIA,” she said, noting that chief executive officers have been compelled to tighten fraud management, which has been skyrocketing among some medical services providers.
“It is a business decision for them to terminate and IRA does not command who they should deal with or not. What is important is to talk to the terminated medical facilities to change,” she added.
Asked whether IRA would charge those implicated in the fraud, Ms Nalunkuuma said: “There is no specific law we can point to,” noting that as the regulator, “focus is to ensure that clients are served well, get their claims promptly and efficiently.”
The insurance sector has over time registered an increase in fraudulent claims.
According to IRA, fraudulent claims worth Shs4.9b were recorded between January and September 2019.
At least Shs64m worth of fraudulent medical insurance claims were registered in the period.
The insurance companies are now raising the alarm to ensure policy holders are not cheated and are offered the right services.
Medical insurance services providers key among them Jubilee and UAP, said yesterday that Uganda Insurers Association had commissioned a fraud survey of service providers and had found that a number of those that were terminated were non-compliant.
“Although this action may result into regrettable inconveniences, it is done in good faith to ensure that your benefits are not robbed in the manner the affected facilities [terminated] have been doing,” one of the notices read in part.
Daily Monitor has omitted details of the listed companies because none has been sanctioned before court to answer for the alleged fraud.
According to a source who declined to be named because he is not authorised to speak to the press, hospitals and other services providers, according to the UIA investigations, had been conniving with clients to inflate service bills.
Other service providers, he said, had been billing insurance firms for no service offered while others have been dispensing services to none-card holding members.
Inflating bills, he said, remains a major challenge in the medical insurance sector, which calls for concerted efforts to stop the vice.