Discovery Health has recently abandoned its efforts to reclaim roughly R170 million from 16 507 members following a widespread administrative error in processing medical claims. This happened after the successful intervention of the advocacy group MediCheck, which argued that the affected members were being unfairly penalised for a technical glitch which they had nothing to do with.
The glitch, which happened last year, resulted in over-reimbursement of certain medicine costs that occurred throughout 2025. Several specific technical and procedural issues were involved which caused the problem to grow undetected for nearly a year, as detailed by Moonstone.
The main error was that certain claims were incorrectly reimbursed at 100% of the Discovery Health Rate, regardless of the specific benefit limits that should have applied to those categories, when they should have been reimbursed at a lower rate.
Because these claims were incorrectly reimbursed at higher rates, they were inaccurately accumulated towards members’ benefit thresholds. This caused members who had Above-Threshold Benefit (ATB) as part of their plan to reach it prematurely. Upon reaching the ATB, subsequent medical claims were funded by the scheme. Normally, these claims would have been covered by the members’ medical savings accounts or out-of-pocket contributions.
Delayed detection allowed the problem to grow. The error was particularly difficult to identify because it was a “second-order impact”. The systemic failure only became apparent late in the year when members began reaching the ATB and the financial discrepancies were finally flagged.
This snowballing error eventually affected some 16 507 members on specific Executive, Comprehensive, and Priority plans. While Discovery Health initially sought to recover these funds, ranging from thousands of rand to as much as R80 000 per member, the Council for Medical Schemes stepped in to exert pressure amid widespread media coverage of the situation. Discovery gave in and committed to refunding any recovered funds and absorbing the total financial loss itself – estimated between R130 million and R170 million.
