Balancing quality care and price

01 October 2008 Thokozani Magwaza, Sechaba Medical Solutions

The private healthcare sector continues to grapple with ways to find long-term, workable solutions to achieve the government's target of affordable and accessible healthcare in the private sector.

There has been much debate in the healthcare industry on how to achieve the government's target of affordable and accessible healthcare in the private sector. The Department of Health has set out stringent laws and policies to address this very issue, setting its focus on one sector of the industry at a time to address the perceived cost drivers within the industry.

Excessive increases in healthcare, especially private hospital tariffs, are the current focus of government's initiative to drive down costs and make healthcare more affordable. As it pushes forward with this rigorous approach, there is a counter resistance and push back from many players within the private healthcare sector.

Finger pointing

Private hospitals have been accused of not being willing to negotiate tariffs that are affordable to medical scheme members, making medical scheme membership and private healthcare less affordable and accessible to most South Africans. With medical schemes currently squabbling over a cumulative membership of about 8 million, and more tariff increases imminent, it seems the private healthcare sector continues to grapple with ways to find long-term, workable solutions.

Thokozani Magwaza, CEO of Sechaba Medical Solutions, says that with a lot of finger pointing around the healthcare arena, the vital question still remains whether escalating costs can continue unhindered or whether ultimately these are going to hinder the future of private healthcare as it continues to isolate the majority of people from joining the private healthcare fold?

Sector stagnating

"It is a worrying thought when the healthcare sector has been steadily stagnating," says Magwaza. "Private healthcare has been an unaffordable luxury for many and members of medical schemes are constantly striving for ways to stretch their money even further."

Former Health Minister, Dr Manto Tshabalala-Msimang, was widely and openly criticised for introducing the National Health Amendment Bill. She was accused of trying to rule the industry with an iron fist through the nationalised approach of setting tariffs. Her response was that she was only trying to facilitate and co-ordinate the collective negotiations on tariffs.

Increased cost vs increased benefits

However, it is clear that tariff increases do not always mean improved services and delivery to the end consumer - who often fail to see how the extra money they pay actually benefits them.

Many people therefore are choosing to refrain from joining medical schemes because they can not keep up with the cost escalations, putting further pressure on the overburdened public healthcare sector.

Members should see an increase in their benefits in every strategic cost hike and should see a value added difference in service and delivery," says Boysie Phehlukwayo, Head of Scheme Governance at Gen-health Medical Scheme.

"It is up to the entire healthcare industry to pull together, and work with government, to ensure that members get real value for their money and to find sustainable long-term solutions that will ultimately benefit everyone.

"Increased tariffs should mean better healthcare and benefits for members." concludes Magwaza.

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