Discovery drops clawback demands after public scrutiny

What began as a deeply unsettling experience for thousands of Discovery Health Medical Scheme (DHMS) members has ended with a clear commitment from Discovery Health, the medical scheme’s administrator and managed care providor, to protect its impacted members and absorb the full cost of a system error. 

Late last year, some DHMS members received emails and phone calls informing them that, due to a claims processing error, medical benefits had been paid incorrectly over a number of months. Members were told that their Above Threshold Benefits  had  accumulated beyond what its plans allowed and that it was assessing the amounts involved. In some cases, the sums ran into tens of thousands of rands. 

The communication caused shock across the board. For many members, the idea of owing money for healthcare expenses they believed were covered was distressing. However, within days, Discovery Health reassessed its position. After engaging with members, consumer representatives, and regulators, the medical scheme administrator announced that it would cover all costs arising from the error and that no member would be required to repay any money. The decision brought immediate relief to affected members and was widely welcomed. 

Discovery Health has explained that the issue arose from a systemic medicine claims processing error that occurred between January and December 2025. Certain medicine claims were incorrectly accumulated and paid through the above-threshold benefit, which meant that members reached that benefit earlier than intended. Once the threshold was reached, subsequent claims were incorrectly funded by the scheme rather than from members’ medical savings accounts or out-of-pocket contributions. 

When the error was identified, DHMS  initially notified members that it was reviewing the payments. As the impact on members became clearer, the scheme took the view that fairness required a different approach. 

Dr Ronald Whelan, the chief executive officer of Discovery Health, said the scheme apologised to members and took responsibility for resolving the matter. “We recognise that this caused distress and uncertainty, and we are sorry for that,” Whelan said. “Members reasonably believed these benefits were available to them, and they made healthcare decisions on that basis.” 

He said Discovery Health not only considered the legal framework governing medical schemes, but the lived experience of members. “Once we looked at how this affected people in real terms, it became clear that the right outcome was for Discovery Health to absorb the cost.” 

Discovery estimates the total cost of the error at about R125 million. Whelan said  this figure should be understood in the context of the Scheme’s overall scale and the accuracy of its claims system, which processes claims at a reported accuracy rate of 99.9%. In that context, he said, the amount reflected a system exception rather than a material risk to members 

“We have made it clear that members will not be required to repay anything and that their benefits will not be reduced,” he said. The scheme has also committed to strengthening its internal systems to prevent similar issues in future. Discovery Health plans to commission an external audit and expand post-implementation monitoring to detect anomalies earlier. 

The error, Whelan said, was difficult to identify because it became apparent only later in the year when members reached the above-threshold benefit. “These kinds of second-order impacts are challenging, but that makes it even more important to learn from the experience,” he said. 

Consumer watchdog MediCheck, which was contacted by many affected members, said the outcome provided reassurance. Mark Hyman, the founder and chief executive officer of MediCheck, said members were relieved by Discovery’s announcement. “People were anxious when they first received those emails,” Hyman said. “The confirmation that no-one will have to pay anything has brought enormous relief.” 

Hyman said the episode demonstrated the importance of engagement between medical schemes and their members. “What matters is that the issue was addressed and resolved in a way that protects members,” he said. The Council for Medical Schemes has confirmed that it is aware of the matter and has noted that medical schemes are expected to act transparently and fairly when dealing with administrative errors. Discovery Health’s decision to absorb the cost aligns with those expectations. 

For affected members, the resolution means certainty and peace of mind. Medical bills already paid will not need to be revisited, and future benefits will not be affected. 

While the episode highlighted the complexity of administering large healthcare systems, it also showed that when errors occur, they can be resolved in a way that places members first. For many DHMS  members, what began as a worrying email has ended with reassurance that their medical scheme, and the scheme’s administrator, stands behind them when it matters most.