Top academic linked to kickback schemes

May 10 2000

By Lynne Altenroxel

An award-winning academic who is chairing a body setting up regulations against medical kickbacks also serves on the board of Medicross, a doctors grouping formerly involved in incentive schemes.

Yet Professor Jan van der Merwe, decorated by the Suid-Afrikaanse Akademie vir Wetenskap en Kuns in 1989 and an executive member of the Health Professions Council (HPC), still believes the answer to perverse incentives lies with self-regulation.

This is in spite of the fact that Medicross has had a case related to kickbacks pending against it for three years, following a complaint by the Department of Health.

The charge related to unethical conduct by doctors in the Medicross group, and the department submitted, as evidence, documentation which stated that doctors would receive 20 percent of the profit on medicine they prescribed.

A hearing into the matter, scheduled for October last year, failed to materialise. In the interim, the Medicross grouping changed its contracts to ensure that all deals between it and pharmaceutical companies are deemed to be above board. The new arrangements are outlined in a complex 120-page document.

Medicross managing director Tony Brewitt said on Wednesday that, according to an HPC advocate consulted six weeks ago, the council now had no grounds for taking the case further.

He said he believed the case had taken so long because of the rocky transition the HPC had undergone in its transformation from the former South African Medical and Dental Council.

Medicross was one of the doctors' groups named by The Star last week as having an agreement with pathology giant Ampath in which it received 12 percent of the turnover generated by blood-test referrals.

A Medicross document in The Star's possession indicates that, as early as 1994, it offered its 300 members 20 percent of the net profit generated from the medicines they prescribed. Both these practices are considered unethical.

Brewitt said money collected from Ampath and pharmaceutical concerns were purely an "administrative fee" which went to the Medicross company, not to any member doctors.

He said the healthcare group had "been very specifically structured to prevent this type of situation".

Meanwhile, a detailed code dealing with perverse incentives is currently under discussion and is set to be debated by the Forum of Statutory Health Councils on June 24.

The person in charge of setting up this code is Van der Merwe, who sits on the Medicross board.

He said on Wednesday he was aware of the pending case against Medicross but was not aware of the contractual side of Medicross.

"I'm not part of Medicross as such, and I don't know their business," he said.

He knew that Medicross had contracts with certain people, but did not have further details. He was vehemently opposed to perverse incentives.

"If they exist here then they must be exposed and stopped," he added.

Leonhard Rode, acting registrar of the HPC, denied there was any case pending against Medicross.

"We in no way can have a hearing against Medicross because Medicross is not registered with us. It must be about an individual," Rode said.

Asked about potential conflict of interest between Van der Merwe's position on the Medicross board and his chairmanship of the body setting up the new regulatory codes, Rode said: "Everybody on the council has another job somewhere."

Acknowledgement to