Business groups which were hoping that the controversial NHI Bill clause relating to the role of medical schemes would be tweaked, were disappointed this week when a National Council of Provinces (NCOP) committee adopted the Bill with no changes, writes MedicalBrief.
On Tuesday, the NCOP's Select Committee on Health & Social Services committee approved the Bill in its current form – despite extensive public submissions and recommendations – taking it a step closer to final approval by the ANC-dominated NCOP, which is expected to vote in favour of it next week, BusinessLIVE reports. The Bill will then be submitted to President Cyril Ramaphosa for assent.
“We are obviously very disappointed,” Business Unity SA (Busa) chair Cas Coovadia said. “We have consistently said we don’t have a problem with NHI itself (but) certain sections need to be changed. Our submissions have fallen on deaf ears.”
If enacted, the Bill’s provisions would weaken rather than strengthen SA’s health system and raise the risk of an exodus of healthcare professionals, he said.
Last week, Busa and Business for SA (B4SA) expressed optimism the Select Committee would change section 33 of the Bill, which says medical schemes will be allowed to offer cover only for services not provided by the NHI.
B4SA was formed during the coronavirus pandemic, and includes the Black Business Council and Busa, which is the Nedlac business representative.
“I am still cautiously expecting that there will be some amendments to the Bill before it gets signed into law by the President,” said B4SA chair Martin Kingston. The President has the power to refer Bills back to Parliament for further consideration.
Previously, the Health Department’s deputy director-general for the NHI, Nicholas Crisp, said the department was looking at “a possible rewording” of section 33 to make the intentions clearer, and that a technical correction was required for the section dealing with medical scheme tax credits.
With the exception of Western Cape, all provinces voted in favour of the Bill without proposing any amendments.
Public hearings were conducted in all nine provinces, and the NCOP received 106 written submissions from stakeholders. More than 23 000 written submissions were also received by the provinces.
Last week, Kingston said: “We have been led to believe, including by Nicholas Crisp, that certain adjustments will be made to section 33. He is well aware of what we believe is necessary.”
BusinessLIVE notes that Section 33 of the Bill says that when the health minister determines that NHI has been fully implemented, medical schemes may offer only complementary cover for services not reimbursed by the NHI fund.
No other country in the world has legislated against provision of cover for private healthcare in this way. Instead of a single NHI fund purchasing services, it wants to see multiple sources of funding, including medical schemes.
Business has repeatedly said the Bill’s proposals are unworkable and unaffordable, and pose a significant risk to SA’s economy and the fiscus.
“There is not a homogenous view in government. Part of our aim is to ensure those thinking more pragmatically have backing from business,” said Coovadia, who added that the scale of state funding needed for NHI was completely at odds with Finance Minister Enoch Godongwana’s position that government expenditure has to be reined in.
The Health Department has estimated the NHI fund will cost R480bn to R520bn a year, and require raising additional tax revenue of R200bn. This will require raising VAT to 21% or increasing personal tax by a third, or raising corporate tax 60%, according to B4SA.
Raising R200bn in taxes from a shrinking tax base would not be feasible or sustainable, said B4SA NHI project lead Roseanne Harris.
Even if the government did manage to raise R480bn for the NHI fund, this would cover only very basic healthcare.
A total NHI fund of R480bn a year equates to R680 per capita, which when adjusted for purchasing power parity is a quarter of the funding available to the UK’s National Health Service (NHS), she added.
However, not just the funding of the NHI, but also the question of trust in the government’s ability to run it was raised at the South African heart congress last month, reports BusinessLIVE.
Darryl Smith, a cardiologist at Linksfield Clinic who works sessions at Charlotte Maxeke Johannesburg Academic Hospital, called it “an elephant in the room”.
“Why should we trust the government with our money when there are no successful blueprints?” he asked. “Money has been poured into Chris Hani Baragwanath Hospital and Charlotte Maxeke – only for them to return to their former state. We have to ask why we must trust the government, not just with money, but with aptitude and ability.”
But Crisp said: “This pervasive distrust has to stop.
“I work with private and public colleagues in all disciplines and there’s excellent management, which doesn’t see us as the enemy. The only enemy is ill health – and we need to deal with it.”
Crisp has described the country’s health system as “a complete shambles – a mess”. He told the conference that public and private healthcare “are disintegrating and we need one another desperately to solve what we’re doing”. He said he and his small team were trying to create one integrated system.
“The problem is that patients move between practitioners and between sectors. How do we continue to pay for that care without discriminating on all parameters – as we now do?”
The NHI will do away with provincial autonomy, said Crisp. “At present the Health Minister controls only 1% of the Health budget. Under the NHI there will be central control, with the budget being allocated to the nine provinces, municipalities, the military, and public and private healthcare sectors.
“You can’t have the private sector, which serves about 15% of the people, consuming 51% of health spend. How do we make the 67% of doctors working in the private sector available to the public – and ensure everybody gets healthcare when and where they need it without (them suffering) financial hardship?”
He said that over time the benefits package would grow as more money became available, and instead of 308 medical aid options under 78 medical schemes, there would be one.
In January, the private sector will launch a purchasing forum to centralise the buying of drugs and medical equipment for treating diabetes and kidney and associated cardiological problems, to reduce prices and improve patient access.
At the same time, the NHI will centralise buying, also to reduce costs, but it will be at least another year before the board that will manage the multibillion-rand fund is installed, he said.
Several pharmaceutical company executives agreed that regarding drug and equipment procurement, the industry is “operating in silos”.
Crisp said a collaborative forum is “well catered for” in the NHI, that the public sector is already negotiating prices that are sometimes a 10th of the single exit price, while motivations to the health minister about “problematic” single exit price regulations are being addressed.
For the first time, the SA Health Products Regulatory Authority would start regulating medical devices and auditing companies and products, he added.
Crisp said his priority was to give the Health Minister the authority to delegate to the provinces only the provider functions (not financing, which will be national). “enabling us to do strategic purchasing where we really need the services”.
Resources are “locked up” in private providers that exist because private funders can pay them, he said. With just 8.9m private sector beneficiaries – a number “rapidly shrinking as people downscale from comprehensive plans to hospital plans” – the system is “simply unsustainable”.
“The key is bringing the public and the private providers into the same payment model –not only the clinics and the community health workers, but the 11 000 general practitioners, who have been neglected and undervalued in the health system for far too long.”
Health Minister Dr Joe Phaala believes inequality is the biggest challenge to the existing system, threatening the sustainability of healthcare for everyone, reports News24.
Expenditure on health in the private sector remains unabated, he said, while public sector allocations are reduced, thus widening inequity.
At the recent conference of the SA Primary Health Care in East London, where he was guest speaker, Phaala promised that “a series of reforms will be implemented to achieve an integrated national system that makes all resources available to everyone”.
“This includes, but is not limited to, implementing national health insurance,” he said.
In the first 15 years of South Africa’s democracy, he told delegates, the numbers of people using primary healthcare services had ballooned: in 2013, 120m visits to primary healthcare facilities were recorded.
Meanwhile, a News24 report says the majority of polled registered voters, particularly black and ANC supporters, believe the government should nationalise the private healthcare industry and be the sole provider of healthcare services, according to a recent survey.
Some 60% of the participants either “strongly” or “somewhat” agreed that healthcare should be nationalised, with the rest opposing the plan.
But while 63% of black participants strongly agreed with state-controlled healthcare, only 4% of whites felt the same way. Among coloured participants, 29% strongly agreed – as did 11% of Indian participants.
The survey, among just more than 1 000 people, was conducted by the Social Research Foundation, which focuses on public policy issues and the promotion of democracy.
The survey also showed that more than 71% of ANC voters strongly agreed with the nationalisation of healthcare compared with the DA (33%) and EFF (57%).
Looking at levels of education, 40% of university graduates and those with a matric strongly agreed with healthcare nationalisation. Among those with only a primary school education, 72% supported the idea.
Less than half of people have formal jobs (43%) and work in the informal sector (47%) strongly support healthcare nationalisation, but most business owners (55%) in the formal sector do, according to the survey.
Of those earning more than R20 000, only 16% are strongly for state healthcare, compared with 67% among those who earn between R3 000 and R5 000 a month.
Some 1 412 people participated in the survey, which took place in October.
BusinessLIVE – NCOP poised to vote on NHI bill without changes
BusinessLIVE article – Business hopeful on MPs softening NHI bill provisions (Restricted access)
BusinessLIVE article – Cardiologists express distress at state’s NHI (Restricted access)
News24 –– New poll shows majority of voters support nationalisation of healthcare
See more from MedicalBrief archives:
Fiscal reason versus NHI fundamentalism
NHI tax ‘ask’ unaffordable, says organised business
Medical aid tax rebates to go to NHI