Research presented at the annual Board of Healthcare Funders conference this week, including allegations that various Health Ministers have deliberately promoted false claims about medical schemes to bolster the case for National Health Insurance (NHI), was slammed by Deputy Health Minister Sibongiseni Dhlomo.
The findings highlighted assertions from a succession of Ministers that the medical scheme industry was on the verge of collapse, that beneficiaries routinely run out of benefits midyear and are dumped on the state, and that most medical scheme members are white, reports Business Day.
The BHF, one of SA’s key industry associations for medical schemes and administrators, with members that collectively represent half of SA’s 9m medical scheme beneficiaries, had commissioned independent research to counter the government’s “sensationalist and emotive” narrative about medical schemes, said BHF MD Katlego Mothudi.
“We were not comfortable with the finger-pointing and what we knew was not factual,” he said.
The analysis was conducted by Wits governance expert Alex van den Heever, who said: “There is a pattern to demonise the medical aid system, to make it look as if it is collapsing and could never form part of (universal health coverage) in the context of NHI.”
While many of the statements were hyperbolic and not backed up by systematic research or evidence, they nevertheless carried weight because they were made by individuals in positions of power, he said.
One of its most controversial aspects is its sharply diminished role for medical schemes, which are restricted to providing cover only for services not provided by the NHI.
Van den Heever’s report for the BHF has not been made public, but he presented the high-level findings to conference delegates on Sunday. The analysis was restricted to comments made since 2008 by Health Ministers, Deputy Health Ministers and former NHI ministerial advisory committee chair Olive Shisana, as they wielded political power and were the key decision-makers on the policy, Van den Heever said.
He identified 11 sets of frequently repeated claims that he concluded were unsubstantiated and untrue. These include the assertion that the medical scheme system is unviable and failing, which is not borne out by the evidence, he said. The industry had remained stable between 2005 and 2022 on all key indicators.
The number of medical scheme beneficiaries increased by 1m between 2009 and 2022, medical scheme reserves stood at 49.2% of gross consolidated income in 2022, well in excess of the 25% statutory requirement, and total non-healthcare expenditure per beneficiary per month had declined 37.4% in real terms between 2005 and 2020.
The claim that most medical scheme members are white is wrong, he said, with Stats SA data showing 50.2% of medical scheme beneficiaries are black African and 32.3% are white, he said.
Similarly, claims that medical scheme members frequently run out of benefits midyear and are “dumped” on the state were false, he added.
The lion’s share of medical scheme claims is covered by the basket of care known as the prescribed minimum benefits, which schemes are legally obliged to cover in full.
Moreover, there has been a systematic decline in medical scheme beneficiary use of public hospitals, and the Health Department has done no research to back up its assertions, he said.
Deputy Health Minister Sibongiseni Dhlomo, who attended the conference on Sunday night, dismissed Van den Heever’s analysis.
“I would not expect anything less from Professor Alex van den Heever, because he is already a known consultant of the DA on NHI, so his stance would not be different from that of the DA. I would not really engage with his presentation, because he is not a clinician,” he said.
Van den Heever said the Deputy Minister was seeking to deflect attention from the issues raised by the research with a personal attack.
“As an expert report, it should be responded to on its merits,” he said. “I have been asked for advice by multiple political parties and organisations on health reform and other areas of public policy, including by the ANC.
“This is … ongoing and arises because many organisations want a better understanding of these complex issues. This was an expert report commissioned by the BHF and has nothing to do with any other organisation.”
Meanwhile, a senior Treasury official told the BHF conference that plans for the NHI are likely to take many years to implement as there is limited scope to fund it with higher taxes.
“It is quite likely the evolution of NHI will be gradual over many years (and it is) likely it will not be promulgated all at once,” said the Treasury’s chief director for health and social development, Mark Blecher, according to a BusinessLIVE report.
The current financial environment had created budget pressures throughout the government and it would be difficult to generate additional funding for health by raising taxes, he said.
It was difficult to make the case for increasing the proportion of public money set aside for health as it was already high relative to many other countries, said Blecher. SA allocates between 13% and 14% of its budget to health, more than triple the share set aside by India (3.7%) and double that of Egypt (6.8%), he said.
Moreover, many countries that spent less on health were achieving better health outcomes, he said, citing Indonesia as an example.
Government health expenditure was 5% of GDP in 2021 in SA, compared to just 2.2% of GDP in Indonesia, yet life expectancy in SA was far lower, he said. Life expectancy in SA in 2019 was 66 years, compared to 71 years in Indonesia, according to the World Bank.
“We do need to move forward to NHI but we need to realise the fiscal constraints we are working under … and not being unrealistic about what the public sector can and cannot do,” he said.
“I think colleagues should perhaps not be unnecessarily nervous about the future because changes will be long and involve many stakeholders,” he added.
The Health Department’s director-general Sandile Buthelezi said NHI would be phased in over time. “We see the first three to five years as just dealing with the fund,” he said, referring to the establishment of the NHI Fund, which the Bill says will be the sole purchaser of services acquired from accredited public and private sector providers.
Prepared to challenge
HOwever, the BHF said it was ready to challenge the Bill when the “President finds a pen to sign it into law”, said Mothudi.
The industry, he added, was currently characterised by an integrated approach towards public and private health citizens, and “in this regard, the BHF supports UHC and recognises the NHI as one of the mechanisms towards its progressive realisation”, reports The Citizen.
And while the BHF and its members have embraced the principles of the UHC and the BHF has actively developed a framework to assist its members in aligning with these principles, they do not, however, support the Bill in its current form due to the unconstitutionality of several of its provisions, its proposed restriction of medical schemes, and the concomitant loss of economic value that will inevitably follow, he said.
The private health funding sector should “not be sacrificed in favour of NHI”.
“It is a valuable source of jobs, scarce skills, infrastructure, financial investment and quality healthcare. The value it adds to the economy and the support it provides to the public health sector cannot be underestimated.”
The Bill reduces the role of the private sector “and therefore the BHF wants those sections removed”.
“Weakening any aspect of the private health sector will weaken the national health system rather than strengthen it.”
“We believe BHF members are well positioned to play a critical role in the NHI environment and we have urged them to fully adopt UHC principles,” he said.
Business Day PressRreader article – Officials ‘demonise’ medical schemes (Open access)
BusinessLIVE – NHI will take years to implement, says Treasury
The Citizen article – Board of Healthcare Funders ready to challenge NHI (Open access)
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