Pri­vate health­care to hit R500bn mark

Ev­i­dence gath­ers in sup­port of reg­u­lat­ing the sec­tor as world bod­ies and NGOs weigh in on in­quiry into soar­ing costs

CityPress - - News - ZINHLE MAPUMULO zinhle.mapumulo@city­press.co.za

Pri­vate health­care will cost South Africans a col­lec­tive half a tril­lion rand a year in 12 years’ time if noth­ing is done to stop the price hikes they are sub­jected to by doc­tors and hospi­tals, says Health Min­is­ter Dr Aaron Mot­soaledi. Speak­ing to City Press this week af­ter rep­re­sen­ta­tives of the World Health Or­gan­i­sa­tion (WHO) and the Or­gan­i­sa­tion for Eco­nomic Co­op­er­a­tion and De­vel­op­ment (OECD) pre­sented their sub­mis­sions about the high cost of pri­vate health­care in South Africa, Mot­soaledi said: “This is what I have been telling South Africans all along, but no­body wants to lis­ten to us.

“Pri­vate health­care spend­ing has in­creased by more than 300% in the past 12 years and if we cal­cu­late the fu­ture spend us­ing the cur­rent in­creases, it will ap­proach half a tril­lion rand,” he said.

Mot­soaledi told City Press this was un­ac­cept­able and added: “Nowhere in the world does pri­vate health­care cost this much. We are even higher than the US, which has a pri­vate health­care spend of 35% [of to­tal health spend].

“But what is bet­ter about the US is that this 35% health­care spend serves 61% of the pop­u­la­tion, while in South Africa 42% of the to­tal health­care spend serves 16% of the pop­u­la­tion,” he ex­plained.

Mot­soaledi al­leged pri­vate hospi­tals were plan­ning to chal­lenge the WHO and OECD re­port at the Com­pe­ti­tion Com­mis­sion’s health mar­ket in­quiry into pri­vate health­care. The hear­ings, which be­gan on Tues­day in Pre­to­ria, form part of a lengthy probe into pri­vate health­care.

“We have heard that pri­vate hos­pi­tal lawyers are plan­ning to bring in ex­perts from the UK to come and rub­bish the re­port. We are not sur­prised by this be­cause they have done it be­fore,” he said.

“Last year, they hauled the Com­pe­ti­tion Com­mis­sion to court soon af­ter the in­quiry be­gan. They spent R45 mil­lion in le­gal fees but lost the case.

“Now they see that the WHO and OECD have pre­sented strong ev­i­dence about what we have been say­ing for years, they are bring­ing in Bri­tish ex­perts to come and chal­lenge the in­tegrity of this re­port,” he said.

Mot­soaledi ex­plained that the sub­mis­sion by the WHO and OECD was the “most im­pact­ful as the WHO is the ul­ti­mate au­thor­ity in health and the OECD the ul­ti­mate au­thor­ity in com­pe­ti­tion”.

The Hos­pi­tal As­so­ci­a­tion of SA (Hasa), which rep­re­sents ma­jor hos­pi­tal groups in­clud­ing Net­care – which led the case against the com­mis­sion last year – de­nied this was their plan.

“Hasa has no knowl­edge of any ex­perts be­ing brought in from any­where for the pur­poses al­leged [by the min­is­ter],” said Me­lanie Da Costa, the chair­per­son of the as­so­ci­a­tion.

Da Costa said Hasa had noted the sub­mis­sion of a work­ing pa­per com­mis­sioned by the depart­ment of health, and tabled by an OECD and WHO study group, to the health in­quiry on Wed­nes­day.

“Our ini­tial re­sponse is to note that the pa­per uses data from some med­i­cal schemes that to­gether rep­re­sent only 60% of med­i­cal schemes in the coun­try. We are, un­for­tu­nately, un­able to as­cer­tain which med­i­cal schemes th­ese are, and whether they are man­aged by one or more of the med­i­cal scheme man­age­ment com­pa­nies,” she said.

“Se­condly, in our view the pa­per is es­sen­tially an af­ford­abil­ity study. It fo­cuses on the af­ford­abil­ity of pri­vate health­care for all South Africans, not those on med­i­cal schemes.

“We be­lieve the pa­per might also have looked at the af­ford­abil­ity of pri­vate health­care for peo­ple with jobs in ad­di­tion to the af­ford­abil­ity of pri­vate health­care for the un­em­ployed, which it seems was the pa­per’s fo­cus.

“This would seem ap­pro­pri­ate in a coun­try that is ac­knowl­edged to em­body both de­vel­oped and de­vel­op­ing eco­nomic char­ac­ter­is­tics and which has as wide a Gini co­ef­fi­cient [wealth gap] as ours,” Da Costa said.

The in­quiry also re­ceived sub­mis­sion from sev­eral non­govern­men­tal or­gan­i­sa­tions – Sec­tion27, the SA Fed­er­a­tion for Men­tal Health and the SA De­pres­sion and Anx­i­ety Group – which all ar­gued that pri­vate health­care was very ex­pen­sive in South Africa.

They called for regulation of health­care prices, stat­ing that pri­vate health­care users were bur­dened by out-of-pocket pay­ments be­cause schemes don’t pay for the full amount doc­tors and hospi­tals charge.

Ac­cord­ing to the Coun­cil for Med­i­cal Schemes’ an­nual re­port re­leased in 2014, scheme mem­bers paid R20.7 bil­lion out of their pock­ets to cover the short­fall in their med­i­cal bills.

This week, WHO and OECD rep­re­sen­ta­tives – sci­en­tists and econ­o­mists Francesca Colombo, To­mas Roubal, Sarah Bar­ber and Luca Lorenzi – pre­sented their fig­ures on the cost of pri­vate health­care at the in­quiry. They based their ar­gu­ments on the find­ings of a study com­mis­sioned by the health depart­ment in 2014.

The rep­re­sen­ta­tives showed that pri­vate health­care spend­ing in South Africa was six times higher than the in­ter­na­tional av­er­age, and the high­est among Brics coun­tries (Brazil, Rus­sia, In­dia, China and South Africa).

They also re­vealed that to­tal health­care (pub­lic and pri­vate) ex­pen­di­ture amounted to R311 bil­lion in 2013, 42% of which was used on 8.8 mil­lion med­i­cal aid scheme mem­bers.

In ad­di­tion, the rep­re­sen­ta­tives showed South Africans stayed in hospi­tals for an av­er­age of 3.9 days com­pared with 5.1 days in OECD coun­tries, and some com­mon sur­gi­cal pro­ce­dures had in­creased by 14.7% be­tween 2011 and 2013, forc­ing fun­ders to in­crease med­i­cal aid pre­mi­ums.

D3rAaron M0ot­soaledi

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