Time to put the welfare of health workers before profits
Private health-care providers pay dividends but neglect frontline staff
As the Covid-19 pandemic continues its assault, there is a desire by some to return to a business-asusual, shareholder-first model, but business as usual led us here. Covid-19 sounds a warning bell when this shareholder philosophy infiltrates a sector as crucial as health care. Over the past four years Netcare, Life Healthcare and Mediclinic, the country’s three largest private health-care providers with a market share of about 80%, paid out more to shareholders than they made in profits. These payouts amounted to an average of R92m a week and R19bn in four years.
During this period health-care workers have suffered increased job insecurity as more nurses are stripped of security, benefits such as medical aid, a minimum number of guaranteed hours, and are outsourced to labour brokers under more precarious working conditions during the pandemic.
Currently, 27,360 health-care workers have contracted the virus, in part because of the inadequacy of personal protective equipment (PPE) and lack of free medical attention and regular testing. The Care4Carers Campaign is calling for these three companies to pause payouts to shareholders to protect our frontline workers.
Business and economic models are broken
The worsening inequality crisis is fuelled by Covid-19 but caused by an economic model that has allowed some of the world’s largest corporations to funnel billions of dollars in profits to shareholders, giving windfalls to the world’s top billionaires, a small group of mostly white men. This has left low-wage workers and women to pay the price of the pandemic, with inadequate social or financial protection.
Netcare, Life Healthcare and Mediclinic could have had a lot of cash on hand to shield workers and prevent costly bills to the government when Covid-19 hit. Yet the profits they made prior to the current crisis disproportionately went to a small group of wealthy shareholders rather than being reinvested in better jobs, increasing access to health care, reducing the cost of health care or improving patient experience.
Oxfam SA’s analysis shows that these companies used the four years before Covid-19 to intensify their distribution of profits to shareholders. From 2016 to 2019, Netcare, Life Healthcare and Mediclinic paid out R19bn to shareholders in the same period that they only made R11bn. This amounts to an average of R92m aweek. During that period, shareholder payouts increased by 96%. This means that even when these companies were posting losses, the shareholders continued to gain millions in wealth.
Netcare paid R1.3bn to its shareholders in 2017 when it made losses of R493m. In 2018, Mediclinic paid R963mto shareholders when it made R8bn in losses. While the pandemic forced these companies to cancel the dividend earlier this year, it is worrying that in the past dividends remained constant while profits fluctuated.
This raises questions about the incentives of these entities and their business model. Unlike the public health-care system, which relies on primary health care and working in communities across SA, private health care available in large cities garners big profits through hospital occupancy.
Precautions inadequate
While nurses and community health-care workers have stepped up and turned up to work in this time, we should all ask: who is caring for the carers? The poor treatment of our health-care workers has compromised the quality of health care available to everyone. The Care4Carers Campaign’s recent survey of the state of protection from Covid-19 for health-care workers brings to light the extent of this crisis.
PPE is inadequate: most workers are provided with the minimum required (aprons, sterile gloves, eye protection, surgical gloves). However, the problem is the inadequacy of the PPE for a range of reasons, which include that half of workers are given one mask a shift or a day when the standards require that they must be changed after a single use as they become ineffective after 15 minutes of use. Workers are compelled to use the same PPE the whole week; it is not changed as per the NIPC (National Infection Prevention and Control) guidelines, and N95 masks are limited to doctors.
The survey found that 60% of those polled say they have not been regularly tested (tested once since the March lockdown) and 30% say they have never been tested. Yet University College London scientists recommend that health-care workers should be tested once aweek as a preventative measure. The survey also reveals that health-care workers are not provided with free and adequate medical attention. Health-care workers that are least likely to benefit from medical aid are those on short-term contracts. Most are not given mental health support.
Investment needed
The shareholder-first philosophy is clearly not working. The private health-care sector in SA is not fit for purpose to respond adequately to a global health emergency because of its narrow focus on profits and shareholder payouts before people.
Responsible investors in these companies will understand that ultimately, quality and sustainable health care for all can only be achieved through decommodification of services, public investment in infrastructure and investment in the health labour force to guarantee staffing levels, living wages and decent working conditions.
Netcare, Mediclinic and Life Healthcare need to make a public commitment to pause shareholder payouts (dividends and share buybacks) until 2022 to ensure that all available resources are prioritised for free testing for all health-care workers, for free medical attention for health-care workers who contract Covid-19, and for adequate PPE for all healthcare workers working in SA in public and private facilities.
We call on South Africans to take action. Stand in solidarity with health-care workers by signing this petition at https://bit.ly/2HjF8Ds.
Baloyi is inequality programme lead at Oxfam SA. Mhlanga is a private sector policy adviser at Oxfam
Oxfam SA surveyed 166 health-care workers for a month during the period July 27 to August 27 2020 using two trade unions’ databases: the Young Nurses Indaba Trade Union and the National Union of Care Workers of SA. The survey was sent via WhatsApp messages directly to the health-care workers on the databases in Gauteng, the Western Cape and Eastern Cape. Respondents were mostly nurses (90%), permanent workers (88%), with 86% in the public sector and 10% in the private sector. A note on the low response rate from private sector employees says that some respondents indicated that they and their colleagues feared intimidation for participating in the survey.