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Wednesday, 12 February, 2025
HomeNHIWill Cabinet lekgotla pave way for NHI compromise?

Will Cabinet lekgotla pave way for NHI compromise?

Whether or not the ANC and DA can find common ground on the future of medical schemes will be a major test for the Government of National Unity, and momentum has been gathering behind a compromise option before the Cabinet lekgotla which began yesterday, where the issue will no doubt be on the agenda, writes Spotlight.

The NHI Act has not yet been promulgated and could be amended if the ANC and DA agree to do so. But whether they can meet a compromise remains unclear.

Also at play are at least four High Court challenges to NHI legislation – by the Board of Healthcare Funders (BHF) challenging Ramaphosa’s assent to the NHI Bill just before the elections last year, Solidarity, and the SA Private Practitioners Forum, both claiming government overreach which impacts on people’s right to choose their own health cover and run their own businesses. The South African Medical Association (SAMA) is also preparing a legal challenge. MedicalBrief notes that the Hospital Association of South Africa is also preparing legal action (see story under News Update)

Two proposals

Meanwhile, momentum has been growing with two compromise proposals: one from Business Unity South Africa (BUSA), the country’s apex business organisation, but more pertinently here, the Health Funders Association, the HASA and the Innovative Pharmaceuticals Association of SA.

The other is from the United Healthcare Access Coalition (UHAC), a large coalition of healthcare worker groups including, among others, SAMA, the South African Private Practitioners Forum, and the Progressive Healthcare Forum.

Last year BUSA held a meeting with Ramaphosa and, at his request, provided a detailed yet currently “confidential” proposal, wanting key sections of the NHI Act amended and/or thrown out to enable medical schemes to remain in play by punting mandatory health insurance.

“The BUSA proposal is being processed by the Department of Health and National Treasury. Once processed, a response will be formulated accordingly,” presidential spokesperson Vincent Magwenya said.

The fundamental difference between the two objecting groups is that the UHAC thinks the NHI Act should be dumped completely and replaced with its detailed blueprint, while BUSA wants the existing Act amended to accommodate private funders.

In its proposal, the UHAC urges implementation of long delayed fundamental systemic reform in both healthcare sectors to enable what they say would be efficient, pragmatic and more politically neutral, consultation-driven universal healthcare measures.

We understand that in a meeting between the two groups, shortly before BUSA lodged its proposal, not enough common ground could be found to join forces.

But there are significant overlaps in their proposals. Both groupings embrace mandatory health insurance and dismiss a single central fund as envisaged under NHI as dangerous and financially unfeasible.

DA spokesperson for health Michelle Clarke said her party backed mandatory insurance. She also said the party agreed with the UHAC proposals – and would not hesitate to mount a legal challenge should the NHI go ahead without substantial amendments.

Mandatory health insurance was part of the government’s longer term health reform plans until the pendulum swung in favour of NHI at the ANC’s national conference in Polokwane in 2007 when Jacob Zuma became president of the party.

The idea was placed back in the spotlight last September when Dr Richard Friedland, immediate past CEO of the Netcare Hospital Group and a key member of BUSA’s health delegation, made the case for it at the HASA conference.

Under mandatory health insurance, everyone who is in formal employment, or who earns above a certain threshold, would be forced by law to be a member of a medical scheme.

This, it is argued, would swell medical scheme membership substantially and reduce pressure from the public healthcare system. It is also expected to result in medical scheme premiums being cut because more healthy, younger people will join the schemes.

Unemployed people or those who cannot afford health insurance will still be cared for by the public healthcare system, which would also take paying medical aid members.

Friedland said at the time that mandatory healthcare insurance would triple the medical scheme market from 9.2m to potentially 27.5m beneficiaries over time and reduce those dependent on the state from 53.8m to 35.5m.

Last week Friedland declined to reveal the contents of the BUSA proposal, saying it was with Ramaphosa and thus confidential.

Health Minister Dr Aaron Motsoaledi also rubbished media reports that the Cabinet lekgotla would be taking on board the BUSA proposal.

He did, however, confirm he would shortly announce which of the far-ranging and long-outstanding recommendations of the Competition Commission’s Health Market Inquiry (HMI) into the private healthcare sector would be implemented, something many have been calling for in recent years.

Far-reaching reforms

Adjunct Professor Alex van den Heever, Chair of Social Security Systems Administration and Management Studies at the University of the Witwatersrand, who with Dr Aslam Dasoo, founder and chair of the Progressive Health Forum, forms part of the UHAC, said their fundamental point of departure is that the status quo is unacceptable.

According to the UHAC report, irregular provincial health expenditure levels provide a proxy indicator for corruption. The combined irregular expenditure for eight of the nine provinces from 2017/18 to 2022/23 consistently averages around 12.3% (around R9m per annum) of non-personnel expenditure compared with 0.1% for the DA-run Western Cape.

“The difference in performance between the Western Cape and the other eight provinces is reasonably attributable to governance differences,” the report reads.

Observes Van den Heever: “We’re losing an enormous amount of performance in the public sector because of political appointments into the system. It compromises leadership and results in a massive waste of resources. The Western Cape shows you the difference governance can make.”

He said that in the “dismally” regulated private sector, funding the pooling system was identified as a problem even before 1994, “but you don’t now disrupt the system to amalgamate into a monopoly fund to solve this (i.e, NHI). Risk equalisation would force medical schemes to compete on the value of what they cover, and nobody would be discriminated against in accessing healthcare.”

Van den Heever said the NHI intention to increase taxes and move funding money from the private to the public sector is “unworkable”.

“The way to address pooling problems is to separate pooling from purchasing. The NHI process has pooling and purchasing in the same organisation, centralising everything – which is highly inefficient, unworkable and with negative consequences all the way through.

“The UHAC proposal separates them out, with the provinces and medical schemes remaining as purchasers while strategic pooling or resource allocation is a national function. So, risk equalisation and taxation form part of strategic national pooling functions, while the purchasing and provision of health services are protected from political appointments – including national ministers and provincial MECs.”

Dasoo, who is also a founder member of trade union Nehawu, said the UHAC collaborative proposal draws on all the research developed over several decades including the Taylor Commission, which made recommendations on an effective social security system for South Africa, the HMI, and numerous other official inquiries.

Dasoo described the UHAC report as “everything the NHI is not”.

“This health pathway requires easy legislative changes and is within current fiscal constraints. We can start the process immediately. It requires a change in governance structure of the provincial health systems where politicians relinquish all direct authority they have over healthcare institutions and instead focus on strategic policy.”

BHF hearing in March

A spokesperson for the BHF, Zola Mtshiya, confirmed their NHI legal challenge, set for hearing in March, but said the BHF was only invited to sign up to the UHAC proposal after it was made public. The BHF represents most medical aid schemes – except for the largest, Discovery Health.

BHF managing director Dr Katlego Mothudi said his organisation was “engaging the association (UHAC) on the document”.

“We welcome the willingness to collaborate as an industry as strengthening health systems is everybody’s business.”

Cabinet lekgotla

Despite all these developments, whether the ANC is open to a potential compromise on NHI remains unclear. On the one hand, the presidency says it has asked Treasury and the Department of Health to consider the BUSA proposal, on the other, Motsoaledi has rubbished suggestions that the ANC’s position on NHI has shifted and appears committed to an NHI system that dramatically limits the role of medical schemes.

His position is thus incompatible with that of the DA.

According to media reports, things got very heated between Motsoaledi and DA ministers when NHI and the future role of medical schemes were discussed at a Cabinet meeting in October.

The matter is likely to again be on the agenda at the lekgotla.

Asked about how the GNU might eventually influence universal healthcare, Clarke said: “ANC arrogancy has tapered down a lot compared with what I’m used to. There’s a lot more transparency – but we cannot allow for a very badly written law with huge implications for people’s lives and the economy to go ahead.”

Foster Mohale, spokesperson for the national Health department, declined to provide comment for this article, referring Spotlight to the Presidency and Motsoaledi. “What I can say is we’re still working on the Health Market Inquiry recommendations and will let you know when there’s an announcement,” he said.

Magwenya did not provide responses to most of Spotlight’s questions, other than saying that both Treasury and the Health Department were considering the BUSA proposal and confirming that the President had met with BUSA.

 

Spotlight article – Pressure grows for NHI compromise ahead of Cabinet lekgotla (Creative Commons Licence)

 

See more from MedicalBrief archives:

 

ANC compromise on NHI not on the cards, says Motsoaledi

 

Three possible future scenarios for NHI

 

Government open to more talks and ‘collaboration’ on NHI

 

Busa and Health Department have ‘constructive’ meeting on NHI

 

 

 

 

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