Sections 36 to 40 of the Act require every health establishment, health agency and health personnel providing prescribed services to obtain a certificate of need before they may operate. (Paul Botes)
The Constitutional Court on Tuesday reserved judgment in a case challenging the “certificate of need”, a central feature of the government’s National Health Insurance (NHI) scheme.
The case was brought by trade union Solidarity and the Board of Healthcare Funders, which represents 40 medical schemes. They are asking the court to confirm a Pretoria high court ruling in July 2024 that struck down the certificate of need provisions in the National Health Act of 2003.
The state, represented by the minister of health, the presidency and the director general of health, opposed the application and asked the Constitutional Court to overturn the high court ruling.
Sections 36 to 40 of the Act require every health establishment, health agency and health personnel providing prescribed services to obtain a certificate of need before they may operate. In its ruling, the Pretoria high court found that these provisions were unconstitutional and should be severed from the Act.
Judge Anthony Millar, who handed down the judgment, said the provision was “irrational, incomplete and imposed obligations without considering the professional, financial and social impact on private healthcare providers”. He further held that the provision risked arbitrary deprivation of property and could amount to retrospective regulation.
Before the Constitutional Court, the applicants argued that the provisions unjustifiably infringed several constitutional rights, including dignity, freedom of movement, occupational choice, property and access to healthcare.
They said the provisions give the minister and director general of health wide powers to determine where health practitioners may work and how private facilities may operate. They also argued that they allow the state to compel medical providers to share resources with the public sector without compensation.
“It’s not about fear, it is about power and what is conferred upon these functions. That is why we say that it is absolutely not an abstract,” Solidarity’s senior counsel, Margaretha Engelbrecht said.
The applicants further submitted that less restrictive regulatory mechanisms already exist to ensure fair access to healthcare and that the certificate of need is unnecessary and intrusive.
Government lawyers argued the certificate of need is essential to achieving the NHI’s goals, particularly in redistributing healthcare resources and ensuring equitable access.
They told the court that the provisions are rational and fall within constitutional limits, stressing that the minister’s powers are regulatory and not absolute.
The state maintained the certificate applies only in limited circumstances, such as the establishment or expansion of health facilities or the provision of prescribed services. It added that any decisions could be subject to judicial review.
“Both section 272 and the National Health Act permit the state to adopt a measure such as the certificate of need provisions as a legislative measure to achieve their objects progressively, ie the achievement of equitable distribution of the best possible health services in the national health system across the nation,” principal state law adviser Geofrey Mphaphuli said on behalf of the president.
The case, under docket number CCT 240/24, raises questions about the extent of state regulation in the healthcare sector. The Constitutional Court’s decision will determine whether the certificate of need provisions remain part of the National Health Act or are permanently removed.