Esidimeni explains why medical service costs differ

Life Esidimeni has admitted it is charging the provincial Department of Health up to R8 000 a patient a month less than the Department of Social Development for a similar medical service.

Etienne Petersen, the managing director of Life Esidimeni, a subsidiary of the Life Healthcare group, said the reason for the discrepancy, among other things, was that social development chose the most expensive option the company offered on a contract for frail care.

“We offered the department two cheaper options,” he said.

The only two fully state-funded frail care centres in Port Elizabeth are operated by Life Esidimeni through another company, East Cape Frail Care.

Petersen said the health department’s Kirkwood centre accommodated 700 adult psychiatric patients at a tariff of R10 599 a patient a month.

He said they charged the health department R14 437 a patient for a facility run from Algoa Frail Care where they look after children who need chronic psychiatric care.

“We are also contracted by the Department of Social Development to look after residents at Lorraine and Algoa frail care at a cost of R18 590,” Petersen said.

“The Department of Health contract is based on annual negotiated increases in terms of service level agreements.

“The Department of Social Development contract increases are based on the tender.”

Petersen said Life Esidimeni provided three tariff options to the Department of Social Development, of which the most expensive one was chosen.

“What is important to understand is that the patient profile is different at each of the Life Esidimeni centres.”

Last month, Social Development MEC Nancy Sihlwayi said she was ordering a forensic investigation into the process which led to her department agreeing to pay more than R18 000 a patient.

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