Why does the ANC cling to the clearly disastrous NHI?

“It is difficult to believe that any intelligent person, who has followed the debate and thus learnt of the learnt of the overwhelming practical difficulties that National Health Insurance (NHI) would face, can still believe that the scheme makes sense,” argues political commentator RW Johnson in The Common Sense. He writes: Before 1994, most South African public hospitals were run by a power structure in which the doctors were the predominant element. This had its drawbacks and there were often complaints about the “arrogance” and “selfishness” of some doctors, but at the end of the day, it did mean that the people who knew most about health and medicine were calling the shots. And the fact was, that this predominant role for the doctors was evident in most health systems around the world, even if the basic financial parameters were controlled by hospital administrators. Yet after 1994, the doctors were elbowed aside in most South African public hospitals. Often management authority migrated to trade union officials representing nurses or cleaners, or to white-collar workers who sometimes used their power over procurement for corrupt purposes. The problem was that most of the doctors and specialists were white or Indian and thus it was axiomatic in ANC-ruled South Africa that their day was over. The result, as we know, has been the calamitous decline of public hospitals in most of the country. When Aneurin Bevan started to push the British National Health Service NHS) through Parliament, he tended to see the (until then) private doctors as the enemy: many were well-off and tended to be conservative. Inevitably, his NHS proposals were opposed by the British Medical Association, the doctors’ trade union. An all-out collision seemed inevitable but in the end Bevan proposed that of the 25-member ruling body which controlled the NHS, 13 seats would be chosen by the BMA. With that, the doctors came on board. For Bevan had realised that the NHS had no chance of working if the doctors were flatly against it. Yet this lesson has been ignored by the South African proponents of NHI. To their huge frustration, the views of doctors have simply been ignored in the design of NHI. And NHI will rob doctors of their professional independence. All doctors and all patients will be subject to centralised control by a state body whose key officials will be appointed by the Minister of Health. It is little wonder that surveys show that 40% of doctors will emigrate if NHI in its present form becomes law. In effect, that huge vote of no confidence would collapse the system at its outset. Moreover, it is likely that a large proportion of the country’s upper income group, deprived of the right to continue using the private health system, would also emigrate. The result would be a huge blow both to the national economy and the fiscus, as this group includes top managers, professionals and entrepreneurs – the biggest taxpayers. In other words, enacting NHI in its present form would be a self-induced national calamity comparable only to the Great Xhosa Cattle-Killing of 1856-57. Yet NHI – originally an SACP proposal – has become a key item of ANC ideology, and President Cyril Ramaphosa has insisted that it will go ahead “whether you like it or not”. And he has just repeated that nothing will “stop the work currently under way towards implementation of the NHI”: this despite the fact that he had earlier put NHI on hold until the Constitutional Court has dealt with the 14 major pending court cases. Ramaphosa’s insistence is surely a sign of recognition that NHI has become a non-negotiable ambition for key ANC factions. Yet the fact is that NHI advocates have never yet managed to convince a finance minister that the scheme is even economically possible. This is why they have only ever allocated small amounts to the programme. Indeed, Enoch Godongwana put aside no extra money for NHI in his last budget and commented that simply improving the current public hospitals seemed the most sensible thing to do. This is hardly surprising, since no one has yet done an official costing of NHI or come up with any proper plans for where the necessary money would come from. The reason for this is quite clear: the ANC knows that such an exercise would reveal that NHI is unaffordable. The consensus is that NHI would be hugely expensive: estimates of its annual cost range from R500bn to R1.3 trillion. This is simply unaffordable. The extra money would have to come from taxation, and South Africa is already over-taxed to the point where any increases actually result in reduced revenue. Moreover, NHI advocates assume that, besides the R310bn a year currently spent on public health, NHI would also garner the R250bn a year spent on private health. But that is unlikely to be true. Not a few private health members are pensioners and it would be difficult to levy extra tax on them. And many other current private patients would emigrate rather than be forced to accept lower levels of medical care, so all tax revenue from them would be lost. So even if NHI survived all court challenges, it seems clear that any attempt to put it into practice would be a major disaster. There simply isn’t enough money available to pay for it. There are also far too few doctors and other medical specialists to provide a decent standard of care for the entire population. The opposition of the doctors and the likelihood that many of them would emigrate is a fatal weakness. If the government were to press ahead and implement NHI as it stands, the private medical sector would be destroyed but the then-overburdened public sector would simply collapse, due to insufficient personnel and finance – and that is before taking into account the greatly increased opportunities for corruption opened up by NHI. The result would be a catastrophic mess. As emigration by the middle classes and medical professionals mounted over the next few years, the result would be complete chaos from which the government and the country might never recover. Examining the introduction of national health systems in various Western countries after 1945, it’s clear that this was generally successful because they were all experiencing virtually full employment due to post-war reconstruction, which saw strong economic growth. What this meant was that almost the whole population could contribute towards financing the new health services through the tax system. But South Africa is in a polar opposite situation, with a real unemployment rate of 40%, and with a population approaching 70m, there are fewer than 8m tax-assessed individuals who meet the threshold to pay personal income tax. And just 1m top earners pay 60% of all personal income tax. This is an absurdly too narrow tax base to finance a comprehensive health system. So the question is, why does the ANC continue to advocate so strongly for a clearly disastrous policy? It’s true, of course, that very few people in the ANC have any grasp of economics and that many others are simply too ignorant to appreciate the scale of difficulties that NHI would face. It is also true that it is easy to make NHI sound very attractive to those who don’t understand the difficulties in achieving it. That was why Panyaza Lesufi promised voters in 2024 that on the day after the election, “you can go to any hospital of your choice – whether it’s private hospital or public – and the government will pay the bill”. This was, of course, a deliberate untruth, as anyone who attempted to act upon Lesufi’s promise quickly discovered. A striking fact is that the government and Cosatu have both made sure their key cadres all have access to private medical care, and there are clear indications that many of those fortunate enough to benefit from such schemes are nervous about the prospect of NHI ending that access. This means that the ANC’s propaganda about NHI’s benefits has not managed to convince many of its own. On the other hand, there is no doubt the promise of free medical care in the private sector has been attractive to the far larger number who currently lack such access. If NHI were to actually be implemented, of course, this promise would not be fulfilled and there would be bitter public disappointment, but currently, the ANC is happy to rely on the promise alone. It is difficult to believe that any intelligent person, who has followed the debate and thus learnt of the overwhelming practical difficulties that NHI would face, can still believe the scheme makes sense. The ANC’s answer is: “Whatever the difficulties, the ANC is determined to make NHI work,” and to problems of NHI’s unaffordability, it says the money will “simply have to be found to make it work”. In effect, this attempts to reduce the feasibility of NHI to a question of the ANC’s will-power. Similarly, the ANC tries hard to reduce NHI to a moral issue: if you are not in favour of NHI then you must be saying that poor people should not be allowed proper medical treatment. But while these are not ineffective propaganda ploys, they carefully avoid dealing with the practical facts of the matter. So in the end, the question of why the ANC so passionately advocates a clearly disastrous policy comes down to ideology. The Freedom Charter promised that “free medical care and hospitalisation shall be provided for all”, and since public health facilities have, under ANC rule, been reduced to an abysmal state, then NHI has to be the answer. In addition, of course, the ANC believes its mission is to transform the whole of society – so there must be nothing that can be off-limits to its control, including the health sector. In that sense it is easy to spot the besetting sin of the private medical sector. Go into any private hospital and it is immediately apparent that it is not “transformed”. African doctors are a rarity, and the main Cosatu unions in the hospital sector – Nehawu, Hospersa, Denosa and Samatu – hold no sway there. And the three companies owning 80% of the country’s private hospitals, Life Healthcare, Mediclinic and Netcare, are not ANC-controlled. Their hospitals are run by professional medical administrators, and the doctors (mainly white and Indian) are clearly still in positions of authority. The whole atmosphere is very different from most public hospitals: there is no overcrowding, the hospitals are clean and orderly, and appointments have to be made, just as bills have to be paid. Most patients are, indeed, members of private medical aids and their financial arrangements have to be found to be adequate before they can be admitted. Most of the doctors are members not of Samatu but of the South African Medical Association (SAMA), which has levelled many objections to the NHI proposals as they stand. In a word, there is no sign of “transformation” here. There are no affirmative action doctors or administrators, and quality control is maintained by firm discipline and meritocratic appointments – so in the eyes of the ANC, the clocks in private hospitals were stopped some time before 1994. The result is that this is still effectively an island of white control, and for the ANC, an offensive fact in itself. Moreover, that the private hospitals are universally regarded as being far better than the public hospitals is thus seen as a sort of assertion of white supremacy, which is deeply unacceptable to the ANC and why it has dismissed all attempts to find a continuing place for the private hospitals in a future health system – until, that is, they have been “transformed”. There are, in a word, deep atavistic feelings at work here, which surely explains the ANC’s passionate embrace of the clearly impossible NHI.   The Common Sense article – Why Does the ANC Cling to the Clearly Impossible NHI? (Restricted access)   See more from MedicalBrief archives:   No budget for NHI without price tag – Finance Minister   Can talks avoid courtroom war over NHI?   Some NHI implementation ‘full force ahead’ despite pause – Minister   IRR: Government must tell us what the NHI will cost and where money will come from   Godongwana concerned about plan to dump medical tax credits