Comment by Old Mutual Healthcare MD Thabiso Buku (pictured)
At the Board of Healthcare Funders (BHF) conference held in Durban recently, Manto Tshabalala-Msimang, the Minister of Health, made it clear that government is serious about implementing a national health insurance system.
Old Mutual Healthcare, one of South Africa’s leading providers of administration and managed healthcare services to medical schemes, believes a partnership between the private and public sector will be needed in the government’s solution to the twin problems of a struggling public healthcare system and an increasingly unaffordable private healthcare system.
Only 8 million out of 45 million South Africans are members of private medical aid schemes, leaving the vast majority of people with limited access to basic medical cover, and many having to resort to an overburdened public health system. In 2006 South Africa spent close to R120 billion on healthcare, only about R55 billion was channeled to the public sector, meaning that 85% of the population was catered for by 45% of the spend.
It is no secret that whilst the state has invested increasing capital in upgrading and improving public health facilities, many still remain under resourced, face enormous management challenges and a shortage of skilled human capital. South Africa in the past ten years has seen a steady but increasing trend where our own local doctors and nurses continue to be poached world wide.
Medical inflation since 1995 has consistently exceeded CPIX by 3-5%, and without some form of intervention either by government or the private sector, this situation will likely persist for sometime.
Fourteen years into our new democracy the challenge of providing affordable healthcare to a greater part of the South African people still remains a significant hurdle in realising our full potential as a nation. The question is how we bridge the gap between the public and private sector, and perhaps more crudely, how we increase the provisioning of healthcare to the vast majority of the people of South Africa who have limited financial resources. Surely for every nation to prosper one of the main ingredients is to provide adequate healthcare to its own.
We recognise the importance and role of a well functioning healthcare system, with the overall goal of optimizing the health status of the people of South Africa. This, by implication, means that it does not exist in either the public or private sector at present. Such a future system will focus on improved outcomes and embracing the concept of market competition to deliver at affordable cost. The challenge is to create the right level of legislative framework to achieve this high level goal.
However, we do not believe that legislation alone is going to be the answer to providing affordable healthcare to all South Africans. Rather, the private and public sector as well as other organs of civil society including labour need to engage in meaningful discussions to find solutions to the healthcare issues we face in our country. Neither party can tackle these issues on its own. Careful consideration and compromises in some instances will be the key to reaching an effective solution.
While Minister Tshabalala-Msimang said she would present proposals for a national health insurance system to the cabinet shortly, she has provided no clear indication yet on how the system will operate. While there are merits to introducing a national health insurance system, which would provide basic healthcare cover for the entire population, there was still a role for the private sector to play. Those who see a threat in the introduction of a national health insurance system, should rather look at the opportunities it may create, or rather formulate a credible plan that will bring about a better healthcare system. We also do not believe the introduction of such a system will automatically mean the end of private medical schemes.
Over the years there have been fierce and often conflicting ideas or strategies between government and the private sector on how we bridge this divide. Government on the one hand has bemoaned the seemingly slow reform or response of the private sector in achieving an equitable health system. This has brought about increasing tension, where government has sought rather to impose legislation and reform on a private sector that sometimes seems to have run out of ideas.
On the other hand, the private sector seems not to have the agility and innovation to either formulate a better response to impending legislation or bring about a more equitable, affordable and sustainable health system.
The truth of the matter is that both Public and Private Sector need each other; posturing and flexing of muscle will not bring about the intended results.
OMHc offers support for the policy for a National Health System as documented in the White Paper on Transformation of the Health System in South Africa that will incorporate all stakeholders, i.e. the Government sector, NGOs (including religious and grassroots organizations), the private sector and, especially, the communities. We therefore need to see the public and private sectors as complementary and not as competitors.
We caution, however, that the fact that a model works in one jurisdiction or country does not mean that it would work in South Africa. That lesson we have hopefully learnt from our importation of managed healthcare into South Africa, where it can be argued that in its current form, did not improve quality, reduce cost or increase access to private healthcare. We need to consider and be mindful of our own complexities in trying to implement interventions that could have worked in other territories.
The local private healthcare delivery “system”, unlike the integrated public sector model, is rooted in the cottage industry model of solo or small group practices with doctors, hospitals, pharmacies and diagnostic centres that are not purposefully organised to act collaboratively across disciplines and settings. It is this lack of “systems” and capacity that contributes to current shortfalls in quality, effectiveness and efficiencies.
It still remains to be seen whether the proposed legislative changes will address the root problems causing this problem, and whether it will bring us closer to leveraging capacity and capital in the private sector to assist government in achieving its objectives. These are questions that need to be investigated further.
It is the opinion of OMHc that whilst we debate the merits and de-merits of implementing a National Health Insurance, we also need to consider the following:
· How through government, private sector, labour, NGO’s and other forms of civil society we work together in reducing the gap between the poor and rich.
· How we accelerate the development and delivery of service in our rural area and peri-urban areas
· Proper alignment of private and public sector leadership on a vision and objectives for a sustainable health solution;
· An enabling legislative environment
o Consideration of More deregulation i.e. certificates of need and the restructuring of PMB’s perhaps considering the Basic Benefit Package;
o Competition environment that allows for innovative and integrated solutions;
o Consider Legislative changes allowing institutions to employ doctors;
· A more effective programme on training of human capital to serve the needs of the system
We as industry participants thus have to challenge our current mental models so as to collectively re-design a future healthcare system that serves the needs of all the people in this country.
Thabiso Buku
MD, Old Mutual Healthcare