National Health Insurance Bill is a noble but flawed initiative
The National Health Insurance (NHI) Bill is a noble attempt to fix the unequal and inefficient healthcare system. But it is also flawed and risky, and needs to be revised before it becomes law.
The bill aims to establish a single, state-run fund that will cover the costs of healthcare services for all citizens and permanent residents, regardless of their income or ability to pay.
The objective with NHI is commendable and necessary. SA has one of the most unequal healthcare systems in the world, with a “two-tier” system that favours the wealthy and the well-insured.
According to the World Health Organisation, SA spends about 8.5% of its GDP on health, but only 4.2% goes to the public sector, which serves about 80% of the population. The private sector, which serves about 15% of the population, consumes the remaining 4.3% of GDP. This results in a huge gap in access and quality of care between the rich and the poor and undermines the constitutional right to health for all South Africans.
The NHI bill seeks to close this gap by creating a singlepayer system that will pool resources and risks, and purchase healthcare services from both public and private providers, based on a defined benefits package.
The fund will be financed by a combination of taxes, and the reallocation of money from provincial health budgets.
The bill proposes phasing out the benefits that medical schemes can offer and restrict them to complementary services that are not covered by NHI. Laudable as its objective may be, the bill raises some serious concerns about its feasibility, sustainability and impact on the existing healthcare system, at least from where this writer stands.
TAXES
For starters, NHI will require R200bn-plus in taxes to finance its operations, a whopping sum for a broke country with a sovereign debt rating deep in junk territory, one which already spends around a fifth of its budget on servicing debt and is facing a shrinking tax base.
What’s more, the NHI will specify which healthcare providers and services will be covered by the fund, and users will have to follow a referral system to access them. The result: it has the potential to limit the choice and quality of care for patients, especially if the public sector is not resourced.
In addition, NHI will be managed by the state, which has a terrible track record of running efficient, corruptionfree and transparent public enterprises. Newspaper headlines chronicling graft, public hearings into widespread corruption under the state capture project, and a line-up of state-owned enterprises holding begging bowls out to the taxpayer do not inspire confidence in the government’s ability to handle such a massive and complex fund.
Perhaps the most contentious aspect of the bill is the role of private medical schemes. The NHI bill’s proposal to gradually restrict medical aids to complementary services that are not covered by NHI will effectively undermine the role and value of private medical schemes, which now provide healthcare coverage for about 16% of the population.
At risk of stating the obvious, the bill should be revised to allow for a more inclusive and collaborative approach to achieve universal health coverage. It should coexist with private medical schemes and allow citizens to buy additional benefits and services that are not provided by the fund.
This will ensure that NHI does not squeeze out the private sector, but rather taps into its assets, skills, and experience to improve the overall healthcare system. This will also create more opportunities for innovative companies such as Discovery, which has been a leader in providing quality and affordable healthcare solutions for its members and clients.
This writer supports the vision of NHI to ensure that all South Africans have access to quality healthcare based on need rather than affordability. However, this should not compromise the existing healthcare system, rather enhance and complement it.
President Cyril Ramaphosa may be tempted to sign it into law and leave behind a legacy that brought a sweeping overhaul of the country’s healthcare system, but it would be wise to engage with all stakeholders, including the private sector, to find the best way forward for NHI and the health of the nation.