Medical aid fund bombshell
Fierce debate likely over fair rates for services
Health Minister Aaron Motsoaledi released two Bills yesterday that pave the way for sweeping reforms to South Africa’s healthcare system.
Both are likely to lead to heated debate with private sector providers over what is deemed to be a fair rate for their services.
The National Health Insurance (NHI) Bill seeks to establish a fund that will contract with accredited public and private sector providers to pay for healthcare services for its beneficiaries, as the government realises its ambition for providing universal healthcare.
A crucial aspect of this plan will be the mechanism established to determine what the fund will pay hospitals, doctors and other healthcare professionals.
“It is likely to be a difficult process to determine a fair price for both sides,” Insight Actuaries & Consultants joint chief executive Barry Childs said.
The NHI Bill was released for public comment hand in hand with the Medical Schemes Amendment Bill.
The changes planned for the medical schemes industry were intended to align it with NHI and provide greater protection to consumers, Motsoaledi said.
“The implementation of NHI is not going to be a onceoff event, but will take place in a phased-in approach,” he said.
“While this is happening, medical scheme beneficiaries need immediate relief from serious challenges experienced in the current regime.”
The Medical Schemes Amendment Bill contains measures to improve scheme governance, expand mandatory benefits to include more primary healthcare cover and regulate broker fees more closely.
While it does not detail the fees healthcare providers may charge medical scheme members, Motsoaledi reiterated his stance that there should be a uniform tariff.
“We cannot continue to run a system where people are paid differently for the same services,” he said.
How these tariffs are determined and the extent to which healthcare providers will be able to deviate from them is likely to elicit heated debate.
Alex van den Heever, chairman of social security systems administration and management studies at the University of the Witwatersrand, warned that the governance structure envisaged for the NHI Fund was vulnerable to corruption, as it vested too much power in the minister.
The Bill gives the minister the power to nominate, appoint and remove board members, functions that should not all vest in the same individual.
“Every state institution with the board structure of the NHI Fund has been captured.”
Werksmans attorney Neil Kirby questioned the wisdom of introducing massive reforms into an already strained system.
“While the proposed NHI may, at first blush, satisfy the requirements of government’s obligations to progressively realise access to healthcare services, [it is a] paper-based set of aspirations largely divorced from the realities of public sector infrastructure problems and capacity constraints.
“It’s a bit like building a house with no land on which to put it,” he said.
Motsoaledi said he was acutely aware of the problems confronting the public healthcare system, but improving its quality was an ongoing task, and NHI could not wait for that to be complete.
NHI is at heart a set of health financing reforms that the government hopes will change South Africa’s deeply inequitable access to healthcare.
It plans to introduce universal healthcare that is free at the point of delivery for everyone, based on the social solidarity principle that those who can afford to do so will subsidise those who cannot.
Motsoaledi said NHI would be mandatory and people
would have to pay into it before they paid their medical aid premiums. All healthcare would be free when accessed.
He said that people would not be allowed to go directly to a specialist first‚ as was now the case in the private sector.
They would first need to see a general practitioner‚ who would have to refer them to a specialist‚ such as a gynaecologist or paediatrician.
Much of the criticism of NHI‚ outlined in a white paper in 2015‚ was that it was not affordable.
Healthcare consultancy Econex found that in 2025 when NHI was scheduled to be implemented‚ the government would be R200-billion short.
The Helen Suzman Foundation, in its submission on NHI, also found it was not affordable and was “chasing shadows” instead of fixing the healthcare system.
But Motsoaledi said paying for free high-quality healthcare for all would be the Treasury’s problem.
The Board of Healthcare Funders of Southern Africa (BHF) has welcomed the proposed amendments.
The BHF represents 45 medical aid schemes‚ administrators and managed care organisations in South Africa‚ and 23 medical aid schemes across southern Africa.
“As an industry representative body‚ we support the intention and action aimed at ensuring that the greater population of the country receives quality healthcare,” BHF Southern Africa chairman Dr Ali Hamdulay said.
Port Elizabeth medical aid brokers were rattled after Health Minster Aaron Motsoaledi announced some of the finer details in the Medical Schemes Amendment Bill yesterday.
One of the amendments proposed is that medical aid brokers be abolished.
The amendment bill will set in motion the government’s plans to introduce universal healthcare in the country.
Motsoaledi‚ speaking in Pretoria‚ released details of the amendment bill‚ which aims to completely change the way medical aids work.
“Are brokers really necessary? Almost two-thirds of people paying a medical aid premium pay a monthly sum to a broker,” Motsoaledi said.
“Many members do not even know they are paying this money every month‚ which by now is about R90 per month for each member. “[It] must be abolished.” The amendment bill is not yet law and will be gazetted at 1pm today. Thereafter‚ it will be open for public comment for three months.
Port Elizabeth-based Northbound Financial Services medical aid broker Tanya Grobler was quick to defend the use of medical aid brokers.
“The money we charge is not exorbitant,” she said.
“It’s a small fee for the broker’s knowledge.
“Medical aid schemes in general are too complicated for the man on the street to understand. I think the minister does not really know what he’s talking about.”
Grobler said the R90 referred to by Motsoaledi was the maximum amount.
“Some people pay R25, some R35 a month,” she said.
Circular Health practice manager Brandon Mercer said: “The reality is brokers are there for the benefit of the patients.
“The minister’s proposal does not make sense because the brokers are paid a small fee for their knowledge, which they impart to the clients. It’s a shame, really.”
Motsoaledi yesterday also gave the National Health Insurance Bill the green light.
It has been published in the government gazette, paving the way for the health department to set up an NHI fund to purchase healthcare services on behalf of the population.