The growing unease surrounding the governance of Bonitas, South Africa’s second-largest medical scheme, continues to deepen. Recent responses from Bonitas and the Council for Medical Schemes (CMS) have done little to quell concerns about questionable practices. Instead of offering transparency, they appear to be dodging key allegations, leaving stakeholders with more questions than answers.
Bonitas’s recent decisions, particularly regarding its partnerships, have raised serious concerns about transparency, fairness, and accountability. While the scheme touts its financial strength, the deeper issue lies in the decision-making processes behind closed doors.
One of the main issues revolves around Bonitas’s termination of its long-standing partner, Afrocentric Distribution Services (ADS). The scheme’s trustees ended the contract with ADS, which had successfully grown Bonitas’s membership, only to hand the same responsibility to the former CEO of ADS, Tobie du Preez. Du Preez now heads a much smaller operation, Agile Alternative Business Solutions, with fewer resources.
This raises critical questions: Why appoint its former CEO if ADS wasn’t delivering? Why dismiss a partner that had helped acquire over 50,000 new members, as Bonitas’s 2023 annual report noted?
Conflicts of interest and shadowy figures
Another concerning development is that Agile Alternative Business Solutions moved into offices owned by Willem Britz, a former Afrocentric executive. Bonitas has dismissed this as coincidental, while the CMS has remained silent, claiming no knowledge of a potential conflict of interest. However, these connections suggest that Britz may still influence decisions behind the scenes.
Further scrutiny falls on the decision to award the administration of Bonitas’s BonCap option to PHA. Despite losing two major clients, PHA somehow secured the administration of BonCap’s 54,000 members. PHA was formerly owned by Afrocentric, which sold its stake to unknown entities, effectively creating a competitor. Neither Afrocentric nor Bonitas has explained the rationale behind this move.
Lack of transparency from the CMS
The CMS’ response to these concerns has been underwhelming. While the regulator speaks of promoting competition, it has failed to address the more pressing issues of transparency and potential conflicts of interest. Its silence on how PHA won the BonCap contract only adds to the growing suspicion that personal interests are being advanced over those of the scheme’s members.
In a significant development, Sanlam has decided to sever ties with Bonitas in favour of Fedhealth, resulting in the loss of 10,000 members. While Bonitas has downplayed the decision as a mere strategic move, the implications are clear. Sanlam’s decision reflects a loss of confidence in Bonitas’s governance, raising concerns about the scheme’s internal health.
As these governance concerns come to light, Bonitas and the CMS have failed to provide adequate explanations or transparency. The optics are troubling: contracts awarded to close associates, trustees with potential conflicts of interest, and a lack of accountability from those entrusted with protecting members’ interests. Without a full-scale forensic investigation, the truth may remain elusive.