/ 25 July 2005

Cabinet works to ensure affordable health care

The Cabinet has agreed to the creation of a risk-equalisation fund to ensure access to health care for all South Africans, President Thabo Mbeki said on Sunday.

While only a minority has access to private medical aid, larger amounts of money are spent in the private sector than in the public sector, he told a Pretoria media briefing following this week’s three-day Cabinet lekgotla (meeting).

There is thus clearly a need to ”rearrange the financing of the sector”, he said.

In a statement, the Cabinet said it has reaffirmed the principle of a health system that cares adequately for all South Africans.

”This requires, among others, the creation of structural linkages between public and private sectors, minimum guaranteed packages to all, and the prevention of unfair exclusion of low-income groups.

”It was agreed, in principle, that in the immediate [future], measures should be introduced to ensure risk equalisation among the various private medical schemes.”

Mbeki said the matter will be discussed with labour unions.

Last month, the Department of Health started trials in the private sector to evaluate the proposed risk-equalisation fund. This is aimed at reducing monthly medical-aid payments to R193 a month for all.

The initiative seeks to balance medical-aid premiums between the chronically ill and the healthy through risk balancing and cross-subsidisation.

The fund is one of three pillars of the government’s social health-insurance policy. — Sapa