Value-based care is the solution to our healthcare woes, but for the National Health Insurance plan to be achieved, evolution, not displacement, is critical, urges Brian Ruff in an opinion piece in Business Day.
He writes:
Finance Minister Enoch Godongwana’s call for a “truce” on NHI marks a turning point in South Africa’s healthcare debate.
By urging parties challenging the NHI Act to step out of the courtroom and craft a joint approach, the Minister has acknowledged a fundamental truth: the process is leading nowhere.
But a truce is only a pause in hostilities. For South Africa to achieve genuine universal healthcare coverage, more than a ceasefire is needed – it requires a clear, technically sound roadmap. That roadmap won’t come from abruptly dismantling existing structures, but from carefully aligning and integrating them.
More than 30 years after liberation from apartheid, South Africa continues to operate a deeply inequitable health system divided along lines of income, race and class. Neither public or private sectors functions particularly well, nor is either socially or economically sustainable.
The public system serves 80% of the population but remains poorly managed, highly centralised and largely unresponsive to patient needs. The private sector caters to a wealthy minority at extraordinary cost structured around profit extraction rather than value creation.
For a universal healthcare coverage system to be successfully implemented, our social inequalities must be incrementally addressed. Simply swopping one flawed model for another won’t fix anything, and meaningful reform requires rethinking how both converge over time.
The NHI debate has focused almost entirely on funding pools and benefit packages, ignoring a deeper structural flaw: South Africa has never built an effective healthcare purchasing framework.
At the heart of this failure is the fee-for-service model, which rewards volume over outcomes.
In government-run care this creates a system where purchasers double as service providers, with no real mechanism to ensure value or oversee performance, driving inefficiency at every level.
Privately, the same incentive structure persists: medical scheme administrators earn most of their income from percentage-based premiums, so higher costs perversely increase their revenue.
Across the board, fee-for-service fragments care, encourages unnecessary tests and procedures, and prioritises short-term outputs over long-term health outcomes.
Centralising funding through the NHI alone won’t solve these problems, it will only replicate them on a larger scale.
Godongwana’s push for a negotiated settlement offers a rare opportunity to change course, but only if it addresses the core questions: how resources are allocated and organised, how care is purchased, and how incentives are structured. Get these right and the system can function. Neglect them and we risk repeating past failures, only bigger.
That’s where value-based care comes in. By rewarding results over volume, encouraging co-ordination and integration, and making primary healthcare both financially sustainable and central, it directly tackles the misaligned incentives at the root of the healthcare system’s failures.
In other words, it offers a way to fix the system rather than just rearrange its flaws.
The logical next step is convergence, guided by the principles of value-based care – a model that demonstrates how realigned incentives, co-ordinated services and an outcome-focused approach can succeed in practice. Convergence means taking these lessons and applying them across both systems.
This requires establishing genuine purchaser-provider separation and shifting our focus to prioritise primary care over hospital dependence. Above all, it’s building trust through tangible improvements rather than empty promises.
This iterative, evidence-driven path works with South Africa’s political and economic realities, rather than against them.
The NHI is necessary but it will only succeed if it goes beyond funding and legislation. True success requires transforming South Africa’s fragmented, dual system into an integrated, value-driven model that can deliver universal healthcare coverage effectively.
The real question is whether we are willing to take this practical, evidence-driven path forward.
Or will we continue clinging to entrenched interests and outdated approaches while millions of South Africans experience a healthcare system that repeatedly falls short?
• Ruff is founder and head of technical strategy at PPO Serve.
See more from MedicalBrief archives:
Will it be back to the table for NHI negotiations?
Leave NHI challenges to the court and lawmakers, state says
Government open to more talks and 'collaboration' on NHI
Medical aid tax credit removal may sabotage NHI funding plans