The latest research from the University of Cape Town’s Health Economics Unit has found that spending on the national health insurance system (NHI) would roughly match the total expenditure on healthcare in the country. This is according to the unit’s director, Di McIntyre. The Health Economics Unit is due to release the report in the next few weeks.
In recent months, economics consultancy Econex director Nicola Theron has said the NHI would be unaffordable, at a minimum cost of R196-billion, and the South African Institute of Race Relations has warned that the NHI would threaten private healthcare.
But McIntyre said it was misleading to speak about how many billions of rands the NHI system would cost. “Yes, it will cost a lot of money but what we’re talking about is something that is growing in line with GDP,” she said.
McIntyre said that even with the NHI and substantial increases in health system utilisation, hospital staff and resources, healthcare spending over the next 10 to 15 years would remain at roughly 8% of GDP.
As it stands, South Africans spend just more than 8% of GDP on healthcare, more than any other country on the continent — more than R100-billion. This is more than most upper middle-income countries and similar to some high-income countries.
Yet provincial health departments are chronically under-resourced and further hindered by poor management, fraud and inefficiency. According to Section27 and the Rural Health Advocacy Project, which last week published leaked copies of the provincial assessment reports compiled during former health minister Barbara Hogan’s tenure, provincial health departments were R7,5-billion in debt as of April 2009.
A 25-member ministerial advisory committee has been thrashing out ideas around the NHI system since late last year. Bevan Goqwana, chair of the parliamentary portfolio committee of health, on Tuesday told the Mail & Guardian that he expects the Health Department to report to Parliament concerning its progress regarding the NHI within the next few weeks.
Surprising degree of optimism
Meanwhile, health sector stakeholders on Tuesday showed a surprising degree of optimism regarding the NHI. A snap poll at an NHI dialogue hosted by auditing firm KPMG in Parktown found that 47% of those in attendance thought the NHI would bring positive change.
Sven Byl, global executive director for the healthcare sector at KPMG, said this showed participants were “up for the change”.
But he warned stakeholders that they should make their voices heard in policy discussions concerning the NHI system because it will be difficult to change policies once they’ve been approved.
“Once this is set, it is set. Governments don’t tend to go back and revisit fundamental issues,” said Byl.
Byl said that there is “no right answer” when it comes to setting up an NHI system, adding that instead of copying what has been done in other countries, the government should identify trends and adapt elements that could work in the local context.
The move towards universal health services is a growing trend around the world, though the financing models used to fund these systems differ from country to country.
Other global healthcare trends identified by Byl include the move towards electronic record-keeping and towards “alternative care settings”, such as community clinics or the home.
“People want to be cared for at home, they’re happier at home. Delivering care at home is cheaper, it has better outcomes and reduces the chance of people getting hospital infections,” he said. Byl said that in his native Canada, the state can deliver care for $1,60 per patient per day in the community, whereas it costs $3,50 in the hospital.
Health minister Aaron Motsoaledi has frequently called for people to seek treatment for minor ailments and chronic illness at clinics and district hospitals rather than at tertiary hospitals.
Singapore the ‘future of how you develop a healthcare system’
Electronic record-keeping has the potential to revolutionise healthcare, but Byl said a cautious approach should be adopted when implementing an e-health system. “In Britain, the NHS spent £1-billion on its e-health system and they have nothing to show for it. Canada is in a similar situation,” he said.
In contrast, Singapore has been developing its e-health system for years and at low cost, yet it has no plans to implement the system for at least 10 years. But, he added, when it does “there’ll be an e-health system in every house in the country”.
Byl singled out Singapore as the “future of how you develop a healthcare system”. The city-state spends 4,1% of GDP to insure all five million of its inhabitants. The government covers 80% of the total bill in acute care hospitals and patients pay the rest through a medical savings scheme.
In contrast, though 64% of South Africans rely exclusively on the public health sector, most of the money spent on healthcare in South Africa is spent through private sector.
A previous version of this article stated “The latest research from the University of Cape Town’s Health Economics Unit has found that spending on the national health insurance system (NHI) would roughly match what the government currently spends on healthcare.”
This has been amended in the opening paragraph to read: “The latest research from the University of Cape Town’s Health Economics Unit has found that spending on the national health insurance system (NHI) would roughly match the total expenditure on healthcare in the country.”