The government has announced a proposal for a contributory earnings-based social security system that will provide for retirement, disability and death. This will complement the existing social security system, which has 11,8-million beneficiaries who will receive R89,4-billion in the current fiscal year.
A contributory social security system was recommended by the Committee of Inquiry into a Comprehensive System of Social Security in 2002. The one recommendation that seems to have been left out, however, is social health insurance.
Social health insurance would rely on compulsory contributions from workers, the self-employed, enterprises and government into a fund that would contract with public and private providers for the provision of a specified package of health services. Its goals would be to generate more resources for health, promote optimal use of those resources and ensure greater affordability of health services.
The 2007 Budget Review hints at the reason for the omission of social health insurance from government’s plans. It states that the financing arrangements for this type of health system are more complex than those in a social security system and, ominously, that ”the quality of health care services and greater integration between public and private sector arrangements present more formidable challenges”.
In other words, our public health care services are not up to scratch and there isn’t adequate integration between the public and private health care systems.
Social health insurance is critical for improving equity in our health system, which is characterised by tremendous disparities between public and private care. As much as there have been increases in real terms in the budgets for public health services, more funding is still required, especially in light of additional demands posed by HIV and Aids.
The World Health Organisation recommends that five factors be taken into account when designing social health insurance: the labour market, availability of administrative staff, the legal framework, infrastructure and consensus among stakeholders. South Africa already has experience with the legal and administrative frameworks necessary for managing social security, as well as medical aid funds. Consensus should not be difficult to achieve because social health insurance means additional funding for health services and a larger customer base.
It is probably the impact on labour costs, the public health infrastructure and the public-private integration that need most attention.
There has been progressive extension of medical cover to include more workers, and labour costs are gradually being addressed. In the past year, cover has been extended to all state employees through the Government Employee Medical Aid Scheme, for example.
A bigger concern related to labour costs is the casualisation of labour. Social health insurance is based on the idea that as many of those in formal employment as possible contribute to their health care. Today, however, fewer and fewer people are being employed formally and more are being given contracts or are hired as ”casual” employees. For these employees, there is no medical aid or pension, and sometimes no paid leave. This undermines the possibility of social health insurance.
The critical comments on public hospitals in the Budget Review should be used as an impetus for improving the quality of services at public hospitals. With leadership and good management, most of the problems in public hospitals can be addressed.
As we develop our social security system this year, social health insurance should be at the back of our minds. As a first step, the lack of benefits for some employees should be addressed and administrative systems that will ultimately accommodate a new form of health insurance should be developed. The level of service at our public hospitals should be improved to acceptable standards, and options that include the utilisation of independent practitioners for provision of primary health care services through social health insurance should be investigated.
Thuthula Balfour-Kaipa, a health policy analyst at the Development Bank of Southern Africa, writes in her personal capacity