Efficient sector can provide healthcare for all
Although National Health Insurance (NHI) has the noble intention of creating a healthcare system that is affordable and accessible to every South African, it could heap additional unnecessary pressure on the South African taxpayer.
According to the white paper, the funding of the NHI will rely on various mandatory pre-payment sources, primarily based on general taxes.
However, this could overburden the relatively small tax base of just over 7-million individuals out of 55-million people, according to Profmed CEO Graham Anderson.
“While the NHI is striving to provide affordable healthcare to every South African, the financial implications on the taxpayer could be extremely detrimental,” says Anderson.
He points out that when the Minister of Health Aaron Motsoaledi delivered his address in the National Assembly during the debate on the health budget this year, he said that in setting up the NHI Fund various funding options would be looked at, including possible adjustments to the tax credit on medical scheme contributions.
The minister referred to the February 2017 budget speech by Treasury where it was reported that R20bn in tax credits “will leave the fiscus through the South African Revenue Service back to the pockets of people simply because they are members of a medical aid scheme”.
Motsoaledi said government is proposing that the first step towards implementation of NHI is to pick up those who are outside the system of medical aids and provide services for them through the NHI Fund, which must be created from the R20billion tax credits.
Anderson says removing the tax credits is likely to see at least 2-million beneficiaries of medical schemes, about 22%, fall off and rely on the public sector healthcare system, because they will no longer be able to afford to belong to a medical scheme.
“This would be a huge challenge to the medical schemes industry, because the risk pool is currently just shy of 9-million individuals and if we suddenly lose 22% of that the risk pool would weaken.
“The key to a sustainable and free healthcare system in South Africa lies with an efficient public health sector.
“When the public healthcare sector is running efficiently and providing the correct level of service and care it will be able to deliver primary healthcare to the South African public,” explains Anderson.
Despite the general perception that the quality of healthcare provided by public institutions is lacking, Anderson stresses that there are various public health institutions that are able to currently provide quality healthcare.
“Government’s first priority should be bringing public healthcare up to standard before looking at the possibility of universal healthcare through NHI.”