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Will government fast track national health insurance?

01 June 2009 Gareth Stokes
Gareth Stokes, FAnews Online Editor

Gareth Stokes, FAnews Online Editor

The implementation of National Health Insurance (NHI) is imminent, says Professor Heather McLeod of Integrated Healing. McLeod shared some of her insights on National Health Insurance Implementation at a breakfast function held in Johannesburg recently. The media attended her presentation as part of an Innovative Medicines South Africa (IMSA) project to make material on healthcare financing and reform more freely available and to move the NHI debate into the public domain.

The African National Congress (ANC) Task Team on National Health Insurance worked on an NHI plan between July 2008 and February 2009 and produced a 200-page report on 16 February this year. What does the ANC have in store? Although she’s seen the document, McLeod wasn’t letting anything out of the bag. She urged the media to lean on the ANC/government to move the report into the public domain to encourage further discussion. And McLeod went to great lengths to remind the audience the document presents the ruling party (and not government’s) view. Of course the ruling party and government are inseparable on most policy matters.

Conflicting views; but NHI is inevitable

How soon will NHI be implemented? “There are two or three very different views about what the timeline will be,” said McLeod. The ANC 2009 Election Manifesto mentions the “introduction of the National Health Insurance (NHI) system [to be] phased in over the next five years.” But ANC secretary general, Gwede Mantashe, has other ideas. Speaking on behalf of the ANC National Executive Committee he recently said “the national health insurance must be in place within the first year of [the current] term and continue to improve over the next five years.” The Department of Health (DoH) 2009-2011 Strategic Plan supports a staged implementation. They propose a white paper in 2009/2010, draft legislation by March 2010 and promulgation of a new Act by 2011. The actual structures for the implementation of NHI would then be created from March 2012. Whichever implementation is favoured, we could well see an NHI implementation years before the proposed National Social Security solution.

There are some major stumbling blocks. McLeod notes that the ANC Manifesto doesn’t mention medical schemes, an issue also flagged by ex-minister of Health, Barbara Hogan. She recently said that government still “needs to resolve the role of private funders [and] medical schemes.” Some excerpts from the minister’s address when announcing the aforementioned DoH Strategic Plan are promising: “The role of private funders and providers is also important.” But others will strike fear in the heart of the private sector: “The private health sector in South Africa holds a huge share of the country’s national health resources, human and financial.” Beware shareholders and medical schemes beneficiaries, the resources you benefit from belong to the country!

A broad system for health provision

NHI is inevitable, so we’re going to have to turn our attention to the structure of South Africa’s future healthcare landscape. McLeod discussed the existing South African healthcare environment in four key areas: Revenue Collection, Pooling, Purchasing and Provision. To date, broad consensus has been reached on the likely structure, bar the Pooling and Purchasing functions. The NHI would rely on “general taxation and social security contributions” for Revenue Collection, while Provision would comprise a mix of provincial health departments, public-private partnerships and private providers. But the Pooling and Purchasing areas remain problematic.

The ANC favours a “Single Pool Single Purchaser” model. In this model the NHI would be responsible for pooling of contributions with the provincial health departments and district health authorities handling the Purchasing function. An alternative structure, the “Single Pool Multiple Purchaser” model would also see the NHI responsible for pooling funds while the Purchasing would be handled by a combination of provincial health departments, Bargaining Council Funds, LIMS Funds and medical schemes. McLeod also presented a model titled “Discussion v12” which expands on the Multiple Purchaser alternative.

Coverage is a huge problem

South Africa is home to some 48.855m people (IMSA NHI Policy Brief 2: Health Insurance Coverage). Only 16% of this population is currently serviced by voluntary medical schemes. The difficulty in implementing NHI is that even if cover were extended to every person (and their insurable families) with some form of income, we’d only reach 51.1% of the population.

McLeod concludes “the more lives added under mandatory coverage, the lower the average price of healthcare for all.” We don’t dispute this fact; but the conclusion requires low unemployment and high average wages to succeed. If you multiply this “lower average price of healthcare” across every life in South Africa, you’re left with a bill that will cripple the existing taxpayer base. Although McLeod never covered the likely cost of NHI to individual taxpayers we’ve heard suggestions NHI could command up to 18% of gross salaries. And even then (in our view) the NHI implementation will lead to a serious reduction in the levels/standards of healthcare coverage currently enjoyed by the majority of medical schemes beneficiaries.

Editor’s thoughts:
National Health Insurance is a great idea provided the country can afford it. We believe government is better off upping the capacity and service delivery through the public healthcare sector before forcing an ambitious first-world health policy on its citizens. It took Germany 127 years to achieve universal coverage after legislating Social Health Insurance, while UK citizens are turning to private health solutions to compensate for deficiencies in their NHS. Do you think National Health Insurance is an appropriate healthcare solution for South Africa? Add your comments below, or send them to gareth@fanews.co.za

Comments

Added by Don. , 09 Sep 2009
The proposed system will create the expectation of all 48 million people in SA to receive a service equivalent to the current private service. All people in South Africa will only recieve 10% of the level of service of the current private sector service. (40% of the pool will be needed for admin, 20% will be wasted). This will be the biggest failure of service delivery of the centuary in the world and will eventually be the the end of the ANC momentum.
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Added by KB, 02 Jun 2009
Doctors are striking because they work 36 hour shifts while they are being paid R10,000 p m. Most of our highly trained nurses sits in hospitals over the world. 50 % of our doctors are currently living over the world. The track record of our government from the Eskom to Home Affairs... ag just name the government department is dismal. A better word is maybe"disastrous" Of cause the standards of NHC will be below normal. Who in their right mind will accept that. Does the government think that the 20% of people will pay for the 80%. Truly this is another government disaster on its way...
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Added by GH, 02 Jun 2009
It seems to me that this is just a strategy to get private health subscribers to fund everybody. If this is not the case, then why can't the private health industry carry on providing services that are paid for by individuals who can afford the contributions, and upgrade the public service for the balance of the population? The private health industry is self-sustaining and is not a drain on the fiscus. It seems as if the outcome will be lousy service for all,and it doesn't sound like a free market system to me.
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Added by HT, 02 Jun 2009
If a 1st world country like the UK struggles to keep their National Health Implementation working and running smoothly what are the chances for a 3rd world country like South Africa? Who’s going to pay the monthly premiums? I can tell you that those with an income are going to subsidies those Millions without a monthly income; what is the percentage of unemployment in South Africa at the moment? The old “pool” Health Schemes didn’t make it and those that are still there are bankrupt !! Look at all the exclusions on those schemes!!! A woman can have a breast biopsy but in case of a mastectomy They don’t cover her!!!! They will cover if only a part of her breast is removed; that means she will have half a breast????? That’s inhuman and pathetic!!!!! Leave the Health Industry to the professionals like a Discovery etc and all the Health Brokers!!! Rather increase our Health Commission and make sure that we can afford to stay in the Health Industry Business!!! Ek as ou blanke weduwee, wat nog steeds my eie besigheid bedryf, sien dat ek alweer aan die agterspeen gaan suip!!! The Goverments motto? Soos die ou wet van Transvaal, net baie meer absurd!! “Dinges en betaal!!! “ I rest my case “!!!!
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Added by Gary, 01 Jun 2009
Dream on.....First attend to the sorry state of Public Health Care....then pour billions of tax payers money into a bottomless pit...while those in power continue living in the lap of luxury....wine,women and song...!! Goodbye private health care, intermediaries and 1st world medicine.....!! Vat jou goed en trek Ferreira..
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Added by Ian, 01 Jun 2009
How many current goverment employees are on private medical aid? I would like to know the people proposing this ludicrus idea of 4 000 000 tax payers suppling 49 000 000 people with quality health care, do they stand in the endless public service quess for there medical requirments? Bet not, they most probably have full medical aid susidies by us the tax payers allready, while we survive on hospital plans and pay for our day to day expences out of our pockets. These people live in another world not RSA.
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Added by Olivia, 01 Jun 2009
Hmm let me think how well does the RAF work. Oh yes its bankrupt!!!!! Just as Ian said how do they expect less than 20% pay for the 80%. This is the 80/20 rule in reverse its impossible. Watch an OK health system implode in less than 18months welcome darkest to africa. Any hope of continuing to attract overseas visitors for sporting events will fall be the way side.
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