NHI: What the pundits think

Reaction to the release of the government’s green paper on National Health Insurance on Friday was marked by support in principle tempered with concerns.

The discussion document, which the public has three months to comment on, set out some long-awaited initial details, including an estimate of R125-billion to be spent next year on preparations which include establishing 10 test sites.

The document proposes setting up an all-inclusive NHI to bridge the affordability gap that exists in the health system and narrow the difference in quality of service between public and private sector health facilities.

The Federated Unions of South Africa (Fedusa) wanted to know where the money would come from, given the 5.9-million taxpayers the South African Revenue Services had for the 2009/10 year compared with the population of over 50-million people living in the country.

“Fedusa is deeply concerned that South Africa’s small tax base will genuinely not be able to bear the financial brunt of this large socio-economic need,” Fedusa general secretary Dennis George said.

By 2020 it would need R214-billion, according the paper presented to Cabinet.

A rip-off
The National Union of Metalworkers of South Africa fully supported the NHI—even though most of its members, besides garage workers, already had private medical cover.

They found that although wage increases were fixed at set percentages, their medical aid contributions could increase by as much as 15% unilaterally. In spite of paying contributions the whole year, most found that their cover ran out early in the year.

Their main reason for supporting NHI was because it was a break from the apartheid era’s unequal health care system and that it would ensure equal access to quality health care for all South Africans, especially the poor.

According to a study, around 16% of people in South Africa have private health care.

However, Numsa shared the Congress of South Africa Trade Unions’ (Cosatu) concerns on the proposed introduction of a multi-payer system, which it felt might see private health schemes being allowed to charge the government for a portion of their services.

This could allow medical schemes to “continue to rip off their clients” and be subsidised by taxpayers.

Reasonable fees
The Helen Suzman Foundation felt three months for consultation on the NHI was too short, given the long-term effects of the system.
It wanted clarity on the taxation aspects of NHI, urged transparency to avoid corruption, wanted staff shortages to be dealt with and to know more about the envisaged relationship between public and private health facilities.

In a statement to mark the release of the paper, Health Minister Aaron Motsoaledi said: “It will actually make the sector more sustainable by making it levy reasonable fees.”

He continued: “Over the past decade, private hospital costs have increased by 121%, while over the same period, specialist costs have increased by 120%.”

The Treatment Action Campaign (TAC) and Section 27, a public interest law centre, raised concerns regarding refugee, asylum seeker and non-citizen access, and the structure and governance of NHI.

They wanted to see measures to ensure transparency of tariff structures, reasonableness of prices, significant improvements in the quality of public health and a proposed office of health standards compliance.

Where are funds coming from?
According to some details of the NHI released on Thursday, everybody over a yet-to-be-determined income threshold would be legally required to contribute.

Money would come from four sources: the tax everybody contributes; mandatory contributions from individuals and employers; co-payments and user charges from individuals; and certain public-private partnerships.

Details that the TAC and Section 27 believed the green paper did not cover included the future role of medical scheme administrators, and what the benefit packages would be.

Business Unity South Africa warned that the cost, design and institutional changes would require vigorous debate.

“If additional funds are to be allocated to public health, it is imperative that they be effectively used.”

‘Health for all’
The concepts contained in the green paper would affect household budgets, public finance and the labour market, so phasing in and consultation with the National Economic Development and Labour Council was also called for.

The People’s Health Movement, a nongovernmental organisation that promotes “health for all” and social justice movement, the Alternative Information Development Centre, stressed the importance of strengthening district health facilities and not losing sight of other health-related factors such as good nutrition, sanitation and access to clean water.

The Board of Healthcare Funders say it would encourage a review of the current prescribed minimum benefits to reflect this focus in line with national health policy.

Regarding payment of providers under NHI, it said the proposed risk-adjusted capitation (adjusting rates according to factors like age or illness) system would constructively promote good quality outcomes and would minimise the potential for fraud and over servicing.

It also supported the use of diagnosis-related groups (reimbursing according to the treatment required for a condition such as heart failure, instead of just costs incurred), which it had used for years, as a method of analysing quality and reducing risk for reimbursing hospitals.

But it would like to see the establishment of a healthcare pricing forum so that medical schemes can remain sustainable in the lead up to the implementation of NHI.

Short consultation period
The Hospital Association of South Africa (Hasa) welcomed the green paper on NHI.

“We acknowledge the challenges facing South Africa’s health system, and the department’s intention to ensure that all South Africans have access to affordable, quality health care services regardless of their socio-economic status,” said chairperson Dr Nkaki Matlala in a statement.

“We now have a document that sets out at a high level where we are headed.”

It was a “pragmatic” document and a step towards achieving universal health care coverage.

Hasa looked forward to working with government to find ways of making health care more accessible.

“Hasa does however feel that, given the extensive and lengthy time taken by government in the development of this paper, the public consultation period of only three months appears unusually short for necessary and valuable input from the general public and civil society,” the association said.—Sapa, I-Net Bridge

Effect on private sector
Hospital management group Mediclinic says it will take some time before private sector health facilities are affected by the NHI.

Roly Buys, Mediclinic’s funder relations executive said on Friday that the green paper showed a pragmatic approach to dealing with public health sector issues, but that the whole issue of where the money would come from still had to be questioned closely.

Buys described the NHI as a funding mechanism that would collect the funds and then distribute as and where needed.

“The document is very pragmatic and it says that the first five years would be building the base such as putting in pilot projects, improving facilities and so on,” he said.

Training and spending
The biggest challenge for implementing the entire NHI would be the human capital aspect such as recruiting nurses and other healthcare professionals for schools and primary clinics.

“That proposes 8 000 posts for these professionals. Just where they would come from is still a question to be answered,” he said.

Buys said the training of staff would be one area that the private hospitals would be eager to participate with government in.

Another area would be in running and measuring the outcomes of spending on healthcare.

“Of the 8.5% of the GDP that is spent on healthcare, 4.5% is from the private sector and it is far more effective than that 4% in the public sector,” Buys said.

Charges and costs
He said this was because private hospitals measure everything concerning their facilities.

“If you can’t measure it, you can’t manage it,” Buys said.

He said a study by United States research organisation Monitor showed that South African private medical costs were average on a world index.

“What we have to be mindful of is that charges and costs are two very different things,” he said.

Buys also said that price increases in the private sector were low with them averaging 5% over the past year.—I-Net Bridge

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