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2017/09/06 10:50 AM
The private sector has a wealth of expertise, processes and systems that can give the implementation of NHI in South Africa a major boost.

Dr Clarence Mini from the Board of Healthcare Funders (BHF) of Southern Africa explains why Cosatu’s opposition to the plans of the National Department of Health (NDoH) to allow the private sector to have a role in the implementation of National Health Insurance (NHI) could fundamentally scupper the achievement of universal healthcare coverage in South Africa.

The private sector supports the government’s calls for universal healthcare for all South Africans, and has a wealth of expertise, processes and systems that can give the implementation of NHI in South Africa a major boost.

By far the most compelling reason is that the private sector comprising of medical schemes, administrators, hospitals and medical professionals have the resources that can contribute positively to the improvement of South African healthcare, in general, and to the improvement of healthcare provisioning in specific communities. It is able to share its skills, experiences, research and resources more meaningfully towards the achievement of affordable, equitable and quality healthcare.

Medical schemes and administrators already look after 16% of South Africans and these skills will be of enormous benefit in the public sector which simply does not have this capacity yet. The responsibility of the Minister encompasses the entire healthcare value chain across public and private entities and how these are brought together to ensure the viability and security of quality healthcare provisioning in South Africa.

Our healthcare sector has its problems and we must collectively take responsibility to address the difficulties in an effort to make quality universal healthcare a reality for all – it is a task that our government cannot achieve in isolation.

Of key importance is the fact that the extensive experience and capacity of the private sector which already services millions of South Africans is not lost to the South African national healthcare project. The Minister of Health, Dr Aaron Motsoaledi, recognises the absolute gravity of the task of NHI implementation and its sustainability on the back of a shrinking economy and tax base, and is being prudent in harnessing the assets and expertise that already exist in the private sector.

The Minister simply cannot ignore the resources that are at our disposal. Right now the focus must be on delivering a well-managed, functional and financially viable universal healthcare model for all South Africans that embraces public and private participation and buy-in.
2017/09/06 10:51 AM
The NHI white paper stipulates that until the National Health Insurance is fully implemented and matured, the role of medical schemes will not change. Director General of the Department of Health, Precious Matsoso says, ‘This doesn’t preclude any changes to the business of medical schemes or transformation required in medical aid schemes.

‘Currently, the medical schemes’ role under the fully matured NHI is that of complementary services cover. This means that only services not covered by the NHI can be offered as cover. If medical aid schemes undergo both voluntary and regulatory reform to become aligned and consistent with the objectives of NHI, there will be a need to relook this,’ Matsoso states.

Gerhard Van Emmenis, Principal Officer of South Africa’s second largest open medical scheme, Bonitas Medical Fund, feels that it’s imperative that measures are put in place to allow medical schemes to work in tandem with the NHI, so that value for money is achieved and duplication of costs prevented. ‘Bonitas is premised on making quality healthcare more affordable and accessible. We, therefore, welcome the efforts of the NHI to improve access to healthcare. However, our key concerns are around quality and preventing duplication of services.

‘If the future means there is only complementary cover from medical schemes then it will be very limited in its offerings with cover for services such as dentistry and rare conditions. This means that the number of medical schemes will greatly reduce.’

The number of medical aid schemes is dwindling regardless, as many schemes are struggling to main sustainability. However, clarity is needed around whether people will be prevented from belonging to a medical aid scheme. The funding model for the NHI means that everyone will contribute towards the NHI through a tax-based system but, if you still choose to belong to a medical scheme then it’s your choice and a cost to you of your after tax money. The predicated scenario is that the contribution to a ‘private’ medical scheme will be significantly less through price and other regulation. Making the schemes more affordable while, at the same time, using current medical scheme spending to cover vulnerable groups.

The private healthcare sector is not just for medical aid members

In 2016, Statistics South Africa estimated that 1 515 000 households with no medical aid normally used the private healthcare sector and 706 000 households, where at least one member had medical aid, used the public health sector. In total, 4 679 000 households’ normal place of consultation was the private sector.

This supports the findings of the National Income Dynamics Study, conducted in 2014 by the Southern Africa Labour and Development Research Unit at the University of Cape Town, which surveyed a nationally representative sample of more than 28 000 individuals in 7 300 households. The study found that 41.5% of the respondents went to see someone in the private healthcare sector at their last visit.

‘The reality is that many people use a combination of both sectors,’ says Van Emmenis. ‘Which means the number of people with medical aid does not equate to the number of people using the private health sector. The converse is also true with some medical scheme members using public hospitals or State clinical protocols for the treatment of specific conditions such as Tuberculosis.’

The role of medical schemes

Acting managing director of the Board of Healthcare Funders (BHF), Dr Clarence Mini, said he believed there should be more debate about the role of schemes in the future. ‘Since 2008 we have supported the idea of the NHI and believe that it is in the interests of the greater good of everyone – and not just the 16% who belong to medical schemes. But, we believe medical schemes have a bigger role to play and should not be side-lined. For example, we think it is a mistake to use a single-funder system.’

A ‘multi-payer’ system would mitigate a lot of risk and is one of the ways that the private sector can lend their expertise to the Government regarding the setting up and management of pooled money within the NHI. ‘The Road Accident Fund is an example of what happens when you have one funder, when that funder goes down you’re in trouble,’ Mini said.

Van Emmenis echoes this sentiment. ‘For NHI to be a success, collaboration between medical schemes and Government is essential. There needs to be agreement on the roles of both players as well as which benefits will be covered by the NHI and which can be offered by the medical schemes.’

But what can medical schemes offer that NHI can’t?

It must be conceded that irrespective of how comprehensive the NHI will be, some healthcare services will not be covered. This includes mental health and certain dental benefits.

Timeous service

According to the White Paper, NHI will be rolled out in priority areas first. The initial priorities include healthcare at schools, childhood cancer, women's health (including pregnancy, cervical cancer and breast cancer), disability and rehabilitation services, and hip, knee and cataract surgery for the elderly.

But what about the remainder of the population? ‘Medical schemes offer a number of benefits that are immediately available to members. This allows members to access the care they need, when they need it. If the NHI is to be rolled out to specific target groups first, what becomes of others in need?’ asks Van Emmenis.

Active management of chronic diseases

Medical schemes often cover a range of chronic diseases through managed care programmes which equip members to manage their condition more effective. ‘We’ve seen improvement of 72% in Bonitas members with chronic diseases – especially diabetes and HIV,’ says Van Emmenis. ‘Quality of care is a central theme for us and we are pleased that our initiatives in this regard are bearing fruit. Engagement, collaboration and negotiation with healthcare professionals and service providers enable us to develop innovative solutions that ensure our members have access to care of the highest quality and receive maximum value for money.’

Functional administration

Existing medical schemes and administrators look after millions of South Africans and that capacity does not yet exist in the public sector. Managing the healthcare needs of 55 million South Africans will be an administrative nightmare and further drive costs up.

Preventative measures

A key healthcare challenge is finding a way to identify pre-cursors for serious chronic health conditions and intervening before the onset of disease. While NHI makes provision for preventative care, it is not clear what this will entail. ‘Bonitas uses an innovative emerging risk model which identifies members likely to develop chronic conditions. We then conduct a series of interventions to prevent the development of these or help members to mitigate their severity. This includes access to health coaches, education material and reminders for tests. It has proved very successful with over 32 000 members benefitting,’ explains Van Emmenis.

Dental benefits

The State sector currently has very low patient-dentist ratios. This is compounded by the fact that many dentists choose to operate in the private sector.

Mental health

More than 16.5% of adult South Africans are dealing with some form of mental health disorder, while 30% are likely to suffer from a mental disorder over the course of their lifetime. This is based on the South African Stress and Health study – the first and only nationally representative study of mental disorders in the country, which was done back in 2004. 13 years on, the figures are likely to have risen substantially. As things stand, only a fraction of Government’s national healthcare budget is allocated to mental healthcare. ‘Mental health is a key concern for Bonitas, we offer a range of benefits to aid members seeking support for depression, anxiety and other mental health concerns,’ says Van Emmenis.

The sustainable funding question remains

The healthcare industry continues to be impacted by escalating costs which have made it difficult for many medical schemes to maintain sustainability. The NHI not only faces a formidable challenge in funding, but there is also a severe shortage of healthcare providers, a massive disease burden and a blundering healthcare bureaucracy.
2017/09/06 10:52 AM
Cosatu calls for axing of health minister, saying he is no longer in charge and private sector is dominating process.

Trade union federation Cosatu accused Health Minister Aaron Motsoaledi on Wednesday of attempting to water down the ANC’s policy position regarding National Health Insurance (NHI) and called for him to go.

"We have reached the conclusion that Motsoaledi is no longer in charge," Cosatu spokesman Sizwe Pamla said.

"We no longer trust him. In fact we no longer believe he is the right person to lead the health sector," Pamla said.

NHI is a set of health financing reforms that are aimed at providing all patients with healthcare services that are free at the point of delivery.

Motsoaledi released an updated white paper on NHI shortly before the ANC’s policy conference in July.

Two weeks ago he called for nominations to a set of committees charged with implementing the reforms.

He has drawn steady fire from Cosatu in recent months over the role of the private sector in NHI and the involvement of the Clinton Health Access Initiative in devising its implementation policy.

The initiative has worked with the health department for many years and played a pivotal role in helping it negotiate the world’s lowest HIV drug prices.

Cosatu has also taken issue with the health department’s plans to allow medical schemes to have a role in the transition to NHI. It wants a single fund that pays for all the services provided under NHI and is opposed to alternative financing mechanisms. Cosatu’s central executive committee criticised the minister’s plans for the NHI implementation committees on Wednesday, accusing him of leaving the door open for "corporate capture".

"The seven committees are dominated by the private sector. Cosatu views this as a classic case of one step forward and 10 steps backward, with the detractors of NHI given the mantle by the minister of health," it said. "It makes no sense to draw from institutions or persons that have opposed a single-payer NHI and have vested interests," it added.

Pamla said Cosatu had been concerned about the minister’s approach to NHI since November. "We were worried that some of the people who had been deployed as drivers of the NHI in that department were sidelined and people from the Clinton Foundation [sic] were now the ones at the centre of driving NHI," Pamla said. "You can’t go [to] Nedlac, engage on issues of policy and agree, and go to [the ANC] policy conference, and then later on the DG [director-general] decides to abandon the understanding reached in those platforms and starts undermining all of those processes," he said.

Department of Health spokesman Popo Maja declined to comment, saying the minister and the department preferred to engage with Cosatu directly.
2017/09/06 10:54 AM
The Competition Commission’s healthcare market inquiry is considering recommending that an independent body is established to monitor the quality of private healthcare services.

Patients and medical schemes can shop around for the cheapest doctor or hospital, but have limited scope to compare the quality of care on offer.

The inquiry was established to determine whether there are barriers to effective competition in the private healthcare market, and it is due to release its interim report and recommendations by the end of November.

"It has become apparent to the inquiry ... that the availability of relevant, timely and validated information on provider performance and clinical outcomes of care ... is poor. Information, if publicly available at all, is sporadic, incomplete, not standardised and largely irrelevant for choosing the best value of care," it said in a discussion document released this week.

Patients in many developed countries have access to objective data on the quality of healthcare services, which they can use to help them decide which facilities to use, but there have been limited initiatives like this in SA so far.

Discovery Health ranks private hospitals based on patient satisfaction surveys, but it has yet to publish data on clinical outcomes. Mediclinic also publishes the results of its patient satisfaction surveys.

The inquiry said in its document that a standardised set of measures should be developed. It suggested the data should initially be kept out of the public spotlight, but ultimately shared with patients and funders.

While many industry players expressed cautious support for a possible "Outcomes Measurement and Reporting Organisation", Section 27 attorney Umunyana Rugege queried why the inquiry was weighing up a new institution rather than beefing up existing structures such as the Office of Health Standards Compliance.

Afrocentric CEO Antoine van Buuren said he supported publishing information on the quality of services, provided everyone did so. "Let all the companies publish, or we’ll get a backlash from doctors," he said.

Roly Buys, Mediclinic head of funder relations, said the inquiry’s proposals were similar to initiatives in the Netherlands and the UK. "What’s quite heartening is there is an understanding that it will take some time."

Roshini Moodley Naidoo, Discovery Health head of strategic risk management, said the private sector was collecting some of the data the document referred to, but it could be better used. "We support the focus on quality outcomes, but there should also be a concomitant focus on efficiencies in any quality performance framework.

"In the process of establishing the proposed model … it is critical that quality initiatives already under way towards achieving value-based care are not set back," she said.
2017/09/06 10:55 AM
Aspen Pharmacare expects an improvement in earnings for the year to June following the devaluation of its Venezuelan business in the previous year, among other factors.

On Wednesday, the company said the increase in earnings was lifted by the one-off negative effect in the same period a year earlier arising from the devaluation of Aspen’s Venezuelan business.

There had also been higher intangible asset impairments, which were offset by capital profits realised from the disposal of noncore businesses and products.

The company said headline earnings per share were expected to increase between 43% and 48%, valued at between 1,271.3c and 1,315.7c a share compared with 889c previously “attributable to the devaluation of Aspen’s Venezuelan business in the prior year”.

Earnings per share would rise between 16% and 21% from 945.4c a share.

Casparus Treurnicht, portfolio manager at Gryphon Asset Management, said there were many issues in the business, including the economic difficulties and hyperinflation in Venezuela, that had caused it to cease trading since late 2015.

Strikes and supply-chain issues with its South African operations had also resulted in setbacks for the local segment. Treurnicht emphasized that excessive debt raised in the US and Australia placed stress on the balance sheet when the rand blew out in early 2016.

“I understand they’ve taken out some forward contracts to mitigate this issue.”

Aspen’s results for the year to end June are expected to be published on September 14.

The share price was down 0.64% to R289, 64 at the JSE’s close, having been in decline for two consecutive weeks.

Africa’s largest pharmaceutical company has a market capitalisation of more than R132bn and has an expanding presence in Latin America, Asia, Europe and Russia.

Aspen has acquired the marketing rights to a portfolio of anaesthetic drugs from AstraZeneca and GlaxoSmith-Kline over the past 12 months to make it the largest anaesthetics seller outside the US.
2017/09/06 11:00 AM
Johannesburg - Removing tax credits for medical schemes will make them unaffordable to 22% of current scheme holders, affecting poorer members most.

This is according to research by economics consultancy Econex, which looked at the impact of removing tax credits to medical schemes and then reallocating them to funding National Health Insurance (NHI), suggested by the 2017 White Paper.

The tax credits are paid to principal members of medical schemes to “reimburse” them for making use of private healthcare. During 2014/15 the amount of tax credits paid to these principal members was about R18.5bn.

During 2015/16 the total annual tax rebate paid to a principal member without dependents came to R3 240. A rebate of R12 966 was paid to a principal member with as many as four dependants.

Econex focused specifically on how the removal of the medical scheme tax credits would make medical scheme membership unaffordable, if the affordability threshold is 12.85% of income.

“We find that the removal of medical scheme tax credits will therefore affect poorer medical scheme beneficiaries disproportionately,” said Dr Paula Armstrong. These tax credits contribute to the affordability of medical scheme membership, particularly among the poorer beneficiary income groups. Tax credits effectively lower medical scheme contributions.

“In total, 21.86% of medical scheme beneficiaries will move above the affordability threshold with the removal of tax credits.” This means 1.9 million beneficiaries won't be able to afford medical scheme contributions.

The research was based on the Income and Expenditure Survey of 2010/2011, by Statistics South Africa. Econex observed private expenditure on medical scheme contributions, among other things, to calculate the overall spending on medical scheme contributions and the portions paid by individuals.

Econex calculated the tax rebate payable at a household level using information from the South African Revenue Service, dividing medical scheme beneficiaries into different quintiles on the basis of household income. It then measured the proportion of household income allocated to medical schemes against an affordability threshold.


For the poorest 20% of medical scheme members, tax credit reduces monthly contributions from R820.97 to R583.66. This reduces the proportion of household income allocated to medical aids from 35% to 22.04%.

For the wealthiest 20% of medical scheme members, the tax credit reduces the monthly contributions from R1 953.35 to R1 720.39. This reduces the proportion of household income from 6.29% to 5.50%.

For the poorest 20% of beneficiaries, the tax credit reduces the cost of medical scheme expenditure on average by more than 40%. The cost reduction is an average of 13.54% for the wealthiest beneficiaries.

Almost half (49.07%) of the poorest beneficiaries will move above the affordability threshold, indicating that the poorer medical scheme beneficiaries are impacted the most by the removal of tax credits.
2017/06/22 11:40 AM
The Competition Commission is investigating Pfizer for charging excessive prices for a lung cancer drug that is not registered for sale in SA.

On Tuesday‚ the commission stated it was investigating three pharmaceutical companies for “excessive prices” for cancer drugs.

But the commission made several mistakes‚ including getting the name of Pfizer’s drug wrong.
The commission did not note that all drug prices are approved and signed off by the medicines pricing committee within the Department of Health. The commission also said it had information that gives “rise to reasonable suspicion that Pfizer has and continues to engage in excessive pricing conduct in provision of crizotinib”. Pfizer confirmed that crizotinib is not registered in SA.

An unregistered drug cannot be sold in the country and will not have a price. The commission complained about its R152‚000 price saying it was in possession of information that this treatment was “unaffordable”. Pfizer denied this price.

Wits oncology professor Paul Ruff explained that a handful of patients accessed this drug using a special Section 21 permit to buy it overseas and import it, because it is not available here. Medicines only get a set price after they are registered in the country‚ he said‚ so crizotinib has no local price or supplier.

The European Commission is investigating Aspen for a 1‚500% increase for a 50-year-old leukaemia drug in the UK and a 4‚000% increase in Spain. On Tuesday, the commission said it would also investigate Aspen saying it was in “possession of information that Aspen had engaged in the same conduct locally”.

However‚ it failed again to note all price increases for all drugs are set annually by the Department of Health.

Aspen confirmed that the drugs under investigation have increased, on average, 6.25% a year since 2009 when Aspen bought the drug portfolio from GSK. The commission said Aspen’s drug prices may be “excessive”. The drug used for leukaemia‚ Leukeran‚ costs between R2‚800 and R4‚800 a month per patient.

Myleran‚ used for a blood cancer‚ costs an average of R2‚086 a month but the dose and price will drop after a few months if the cancer goes into remission‚ said Aspen’s spokesman Stavros Nicolaou.
The commission also took issue with Roche’s cancer drug which costs R500‚000 in the private sector for a year’s course. The commission said people couldn’t access the drugs and charged Roche with “exclusionary conduct”. But this drug is to be provided to state patients at one of the lowest prices in the world within months‚ two sources close to the Roche and Department of Health negotiations said.
Roche said recently it believed a deal with the department on supplying this drug to state patients was “about to be finalised” saying negotiations were “advanced”.

Two sources also confirmed that the commission didn’t even call the Department of Health to get its views on the matter or check the commission’s facts. All three pharmaceutical companies learned of the investigations through the media statement.

The commission also charged Roche with “price discrimination” because it has a state price and a private-sector price for cancer drug Herceptin. However‚ the Medicines and Related Substances Control Act allows the prices for medicines for state patients and private patients to differ and‚ in fact‚ a high private price is used to subsidise very low state prices for nearly all medicines in the country‚ two industry sources confirmed.

The commission did not respond to requests for clarification.

In a Sens statement on Tuesday, Aspen said all the drugs under investigation for excessive pricing sell for less than R3m a year combined.

Competition Commission spokesman Sipho Ngwema said the commission knew the Pfizer drug was not sold here but it would investigate Pfizer nonetheless.

Ngwema said: "Whilst we accept that the drug is not registered in SA, however, the conduct has an effect in the country as there are patients who use the drug here. These patients are subjected to very high pricing. Further, our investigation will in any event probe why it is not registered here."

Asked about the fact drug prices and yearly increases are set by government he said: "Even though there is single exit price [set by government], this neither means prices cannot be excessive nor is the process beyond scrutiny. There are drugs that have been investigated in other country for excessive prices that Aspen supplies to SA."

He also said the competition commission had "a sufficient basis to start an investigation".

"Part of our probe will look into patent laws and their effect on entry [of generic products]."
2017/06/22 11:42 AM
Africa’s biggest generic drug maker, Aspen Pharmacare, has lost its appeal against the €5.2m fine levied by the Italian Competition Authority over the price of some of its cancer drugs, a development that comes hard on the heels of Tuesday’s news that it is to be investigated by the Competition Commission in SA.

The Italian case relates to the prices of a portfolio of off-patent cancer drugs that Aspen acquired from GlaxoSmithKline several years ago, and that it recently increased. Aspen’s conduct relating to the price of these drugs is also under the microscope in SA, although the prices of the drugs in question have remained relatively stable as they are regulated tightly by the Department of Health.

Aspen said on Wednesday it had noted the abridged judgment handed down by the Italian court and was awaiting the release of the full reasons for the judgment to determine whether it would appeal to the Italian Council of State appeal court.

Aspen’s head of strategic trade, Stavros Nicolaou, said the cancer drugs in question had not had price increases in Italy for the past 40 to 60 years, despite increases in the cost of production, and were typically used as drugs of last resort by a small number of patients. The list price of a generic equivalent of one of these drugs was more than double the Aspen product’s, he said.

On Tuesday, the South African Competition Commission said it was launching an investigation into the price of cancer drugs, homing in on Aspen and multinational pharmaceutical manufacturers Roche and Pfizer.

Commissioner Thembinkosi Bonakele said the commission had not discussed the investigations with the Department of Health, which regulates private sector drug prices. "It is a sensitive matter, and we need to be independent," he said.

The commission said it was investigating Aspen for alleged abuse of market dominance for its off-patent cancer drugs Myleran, Leukeran and Alkeran, which had no generic rivals.
Aspen acquired these drugs in a portfolio of products it bought from GlaxoSmithKline in December 2009.

Nicolaou said Aspen had not driven up the price of these drugs after their acquisition and had only instituted the increases permitted by the Department of Health. For example, the price of a pack of 25 x 2mg Leukeran tablets was R241.61 (excluding VAT) in February 2009, when it was still sold by GlaxoSmithKline, and now cost R369.79 (excluding VAT), said Nicolaou.

The price increases introduced by Aspen were in line with the medicine-pricing regulatory framework and averaged 6% a year from 2009 to 2017, he said.

SA’s medicine pricing regulations stipulate that pharmaceutical manufacturers must sell their products at the same price to all their customers in the private sector, regardless of the volumes bought.
They also control the permitted mark-ups at every stage of the supply chain. Typically manufacturers get one price increase a year, which is approved by the health minister.

Nicolaou said Myleran, Leukeran and Alkeran were affordable, fully reimbursed by medical schemes and had a combined yearly turnover of just R3.2m. A month’s supply of Leukeran cost R2,000-R4,000 (excluding VAT).

There were no generic rivals in SA because this was a very small market for these products, with limited prospects. "It don’t think any other player would see a market for them," he said.

Roche is being investigated on the price of its breast cancer drugs Herceptin and Herclone, while Pfizer is under scrutiny for the price of its lung cancer drug Xalkori.

The Fix the Patent Laws coalition, which recently campaigned for lower breast cancer drug prices, welcomed the commission’s investigation.

"In SA, the annual price currently charged by Roche in the private sector for trastuzumab [Herceptin] is R516,700, while the few public facilities which can access it do so at a lower price of around R211,920 per year," the coalition said.

"[Roche] maintains its high prices in every way possible and it holds multiple ever-greened patents on trastuzumab in certain countries.

"In SA, for example, multiple patents extend Roche’s monopoly until 2033," Fix the Patent Laws said.
2017/06/22 11:43 AM
The vast majority of lawyers ‘do not pursue claims without merit’, writes a Werksmans Attorneys lawyer in response to Health Minister Dr Aaron Motsoaledi’s assertion that legal system has created perverse incentives, bringing SA healthcare ‘to the precipice’.
In a Bhekisisa opinion piece, carried in MedicalBrief last week, Motsoaledi argued that the legal system had created perverse incentives for lawyers in the form of commission-based fees and that this is increasingly driving lawyers to pursue medico-legal litigation even when some cases have no merit.  Neil Kirby, the director of health and life sciences practices at Werksmans Attorneys responds.
Kirby writes: “If one is to accept the health minister’s proposition that medico-legal litigation is out of control – which is a proposition that may require more formal investigation and study – then, perhaps, the most appropriate government reaction is to map legislation to deal with such circumstances. Maybe a legislative solution is needed to cap damages in legitimate claims against medical practitioners.
“This kind of solution could set out – in a manner consistent with existing legislation as well as the right to access courts in terms of the Bill of Rights and the Constitution – an appropriate dispute resolution mechanism for legitimate claims for when negligence occurs, and the claim is neither frivolous nor vexatious.
“It may be that medico-legal litigation has increased over the past years and it may be that such legal action has shifted to medical practitioners as opposed to the Road Accident Fund (RAF) because of the latter’s financial state. But the conclusion that healthcare workers are now the focus of legal action as a result of the RAF’s financial status is not the only plausible or reasonable conclusion that can be drawn in respect of a supposed increase in medico-legal litigation.”
Kirby writes that patients are also consumers. He says: “Since 2004, with the coming into effect of the 2003 National Health Act, patients have been provided with additional legislative rights concerning, among other principles, informed consent and the legal right to participate in decisions affecting their healthcare and treatment.
“Also, the 2008 Consumer Protection Act endowed patient-consumers with greater rights to understand the goods and services that they purchase, including medicines and medical treatments. The coming into legislative existence of those rights coincided with information about medical treatments and options becoming more widely available to patients through the internet and social media. Patient-consumers are now better informed than ever before not only about their rights but also about concomitant obligations of medical personnel.
“The corollary to the empowerment of the patient-consumer is that, when matters go wrong, they are also aware of the numerous options available to remedy or redress such circumstances.
“It may be easy to lay the blame for increased litigation at the feet of alleged avaricious lawyers, but it is worth remembering that lawyers are – first and foremost – officers of the court. We are charged in society with the administration of justice along with the judiciary. Lawyers are a constituency that is not without the unscrupulous, but the checks and balances inherent in the legal system operate to eject frivolous and vexatious claims.”
Kirby writes: “Judges do not simply hand out cheques and lawyers – in the vast majority – do not pursue claims without merit to achieve a contingency payment of one percentage or another.
“It is also readily apparent that the quality of healthcare will affect the outcomes of medical and legal interventions. Poor-quality healthcare inevitably leads to adverse but otherwise avoidable medical outcomes that, in turn, sponsor legal interventions and encourage medico-legal litigation. Patient-consumers expect more for less and, when they receive less for more, they quite rightly turn to the legal system for help.
“One should therefore not underestimate the prowess of the patient-consumer in the context of today’s legislative framework and the rights afforded to them to access adequate and reasonable healthcare services as contemplated by the Bill of Rights.
“Patient-consumers will continue to enforce their rights by whatever legal means is available to them, especially where they are the recipients of inadequate medical services or treatment, which is the genesis of the harm that is legally actionable.”
2017/06/22 11:52 AM
Hospitals are facing their worst nursing crisis in 20 years after a sudden drop in new arrivals from Europe, experts warn.

Numbers coming from the EU have ‘crashed’ by 96 per cent in nine months.

There were just 46 new registrations of European nurses in April – down from 1,304 in July last year. Academics said the situation was bleak while nursing leaders warned of ‘severe consequences’ for patients.

Hospitals have become increasingly reliant on European nurses in recent years because of a failure to train enough home-grown staff.

Many NHS trusts have targeted staff from Spain, Portugal and Italy, where job prospects are poor and salaries are significantly lower. But many overseas nurses are being deterred by the uncertainty following the Brexit vote and the introduction last June of tougher English language checks, say experts. The latest figures were obtained by the Health Foundation think-tank and published by the Health Service Journal as part of an ongoing analysis into the state of the NHS workforce.

Lead author Professor Jim Buchan, of Queen Margaret University in Edinburgh, said: ‘It is a crash. Clearly something has happened in that period, and that something was most likely the Brexit vote and the uncertainty that has created. It has led to a change in the choices being made by individual EU nurses and midwives.

‘Non-EU nurse inflows have increased but not by enough to offset the decrease from EU nurses.’ Janet Davies, of the Royal College of Nursing, said: ‘We rely on the contributions of EU staff and this drop... could have severe consequences for patients and their families.

‘Across our health service, from A&E to elderly care, this puts patients at serious risk. These figures should act as a wake-up call to the Government as they enter Brexit negotiations.’

In 2015/16, almost a third of nurses – some 9,389 – registering with the Nursing and Midwifery Council came from the EU. There were 19,133 from the UK and 2,145 from outside Europe. The figures for 2016/17 have not yet been published but are likely to be much lower. Only last month the Royal College of Nursing warned that one in nine nursing posts were vacant, equivalent to 40,000 nurses.

Shadow health spokesman Jonathan Ashworth said: ‘Theresa May’s weak and unstable government has pushed NHS services to the brink and it is patients who will pay the price. Our health service has always relied on the contribution of overseas workers yet these staff are being forced out by this Government’s neglect and disregard.’
A Department of Health spokesman said more than 52,000 nurses were being trained, adding: ‘We understand the need to give valued NHS staff from the EU certainty – which is why we have made clear that the future of those EU nationals working in our health and care system should be a priority in Brexit negotiations.’
2017/06/22 01:04 PM
Mediclinic’s share price fell nearly 30% in the financial year to March, though some analysts say the worst may be over for the private hospital group.

The group, with the largest hospital portfolio on the JSE, said that although it had grown in southern Africa, it underperformed in the Middle East. This dragged down its overall performance.

Mediclinic began 2017 on a high when the shares rallied in January after it acquired a majority stake in Life Path Health, a company with nearly 10 mental-health facilities in SA and the rest of Africa.

The share price fell in February after the company issued its second profit warning in five months, citing problems in the Middle East. The government of the UAE required that country’s state medical aid users to pay 20% of private hospital bills. This resulted in net profit from the Middle East plunging 62.5% to £21m from £56m.

Subsequently, the stock fell for five days running, the longest streak since October

The share recovered in April, however, when the crown prince of Abu Dhabi, Sheikh Mohammed bin Zayed al-Nahyan, scrapped co-payment on private healthcare.

Mediclinic’s shares were 0.66% higher on the day at R131.28 at the close on Tuesday.

A recent JP Morgan report by analysts Alex Comer and Ross Krige offered comfort, saying the longer-term structural outlook and ultimate earnings recovery were good, but they suspected weak guidance would temper near-term enthusiasm.

"We suspect we are through the worst for Mediclinic, though the trajectory and scale of earnings recovery are debatable," the analysts said.

Portfolio manager at Gryphon Asset Management Casparus Treurnicht said it looked as if operations at Abu Dhabi’s Al Noor Hospitals Group would be the first to recover, but he would wait for the economic environment to improve in Europe and SA.

He said also that more clarity on Brexit was needed.
"The share is probably trading at its cheapest levels in a long time, but unfortunately political events are present in each and every market where Mediclinic is active and this … is unpredictable" said Treurnicht.
2017/06/22 11:53 AM
Africa’s biggest generic drug maker Aspen Pharmacare, already under investigation by European authorities over the price of its cancer drugs, is now under similar scrutiny from SA’s Competition Commission.
On Tuesday, the commission announced it was investigating Aspen and multinational pharmaceutical manufacturers Roche and Pfizer for suspected excessive pricing of their cancer drugs.
If the Competition Commission’s investigation uncovers abuses, the matter will be referred to the Competition Tribunal for prosecution. The maximum penalty the tribunal can levy is 10% of annual turnover.
Aspen is being investigated for allegedly abusing its dominant market position to charge excessive prices for three cancer drugs — Alkeran, Leukeran and Myleran — which are used for treating leukemia, bone marrow cancer and lymphoma.
Roche is in the cross-hairs for the price of its breast cancer drugs Herceptin and Herclon, while Pfizer is to be scrutinised for the price of its lung cancer medicine Xalkori.
“This investigation is crucial. It is a matter of national importance,” said commissioner Thembinkosi Bonakele.
Aspen is being investigated by the European Competition Commission for steep rises in the price of five off-patent cancer drugs it bought from GlaxoSmithKline several years ago.
It also faces probes by competition regulators in Spain and the UK, and is appealing against a price-hiking fine in Italy.
“Given that Aspen supplies similar products in SA, the commission has reasonable grounds to suspect Aspen may be engaging in similar conduct locally,” Bonakele said.
“Moreover, Aspen appears to be either the only supplier or at least a dominant supplier of these products in both the South African and European markets.
“Given that Aspen’s products are listed as generic products, it is of concern that none of the markets has observed significant entry of other generic products by competing pharmaceutical companies,” he said.
Aspen investors appeared unperturbed by Tuesday’s developments and its share price closed flat at R275.
“I think Aspen is very confident that in SA, they didn’t do anything with respect to price-gouging,” said Aeon Investment Management’s chief investment officer, Asief Mohamed.
Aspen said it had not increased the price of any of its products outside the regulatory framework approved by the Department of Health, which sets a maximum price for medicines sold in the private sector and controls annual price increases.
The commission believed Roche was using an “ever-greening” strategy to prolong the patents it held on its breast cancer drugs to delay competition from generic alternatives, Bonakele said. Roche charged different prices to state and private-sector patients, which may amount to price discrimination, in contravention of the Competition Act, he said.
Roche’s Aadila Fakier said Roche had yet to be formally notified of the Competition Commission’s investigation, but would co-operate with the authorities and provide any information required.
The commission said Pfizer’s Xalkori had initially cost R152,000 for 250mg and had then dropped to less than half that amount.
Pfizer SA country manager Jennifer Power said the R152,000 price quoted by the commission was wrong.
“We await the opportunity to be contacted by the commission to clarify the pricing for this product. We respect the process initiated by the commission and Pfizer shall fully co-operate with the authorities,” she said.
2017/06/22 11:54 AM
Eleanor Becker    
CompCom identifies pharmaceuticals as ‘priority sector’ for its enforcement efforts.
The Competition Commission (CompCom) is investigating Roche Holdings, pharmaceutical giant Pfizer and Aspen Pharmacare for alleged excessive cancer drug pricing.
Roche is being investigated for the pricing of breast cancer medicine, Pfizer for lung cancer medication and Aspen for suspected abuse of dominance in charging excessive prices for cancer medicines.
In a statement released on Tuesday, the CompCom said it has identified the healthcare sector, and in particular, pharmaceuticals, as a priority sector for its enforcement efforts, “due to the likely negative impact that anti-competitive conduct in that sector would have on consumers in general and specifically the poor and vulnerable”.
CompCom commissioner Tembinkosi Bonakele announced the investigations at a media briefing on Tuesday. He said: “This is a priority investigation for us. We have to treat this with the urgency and sensitivity it deserves – there are still many patients in need of these drugs.”
Bonakele said the abuse of patents would be looked into, adding that a perpetual monopoly aided by patents was unlawful. The CompCom is to get evidence from patients in its investigation.
Information suggests Aspen’s has engaged or is engaging in excessive pricing in Leukeran – a chemotherapy medication treating chronic lymphocytic leukemia, Hodgkin lymphoma, and non-Hodgkin lymphoma; Alkeran, used to treat bone marrow cancer and epithelial ovarian cancer; and Myleran, used in pediatrics and adults.
Aspen appears to be a dominant firm in the provision of these drugs.
In a Sens released on Tuesday afternoon, Aspen says it has noted the CompCom announcement and is committed to “full and constructive” engagement with the commission in its investigation.
“It is reiterated that pharmaceutical prices in South Africa are approved by the Department of Health in terms of the Single Exit Price regulatory framework, which establishes a universal fixed price for each pharmaceutical product. Aspen has not increased pricing of its products outside of this regulatory framework and has clearly demonstrated its commitment to providing quality medicines affordably over many years. The supply of the oncology products in question is no exception,” the Sens reads.
At 15:20 on Tuesday, Aspen’s shares were flat in Johannesburg at R275.04.
The Public Investment Corporation (PIC) is Aspen Pharmacare’s biggest shareholder, with a 10.87% stake.
Deon Botha, PIC head of corporate affairs, comments: “We understand that this matter is a subject of investigation by the Competition Commission. It is, however, necessary to mention that we prefer that investee companies abide by the laws and regulations of countries in which they operate and that they act responsibly in their dealings.”
Aspen under fire in the EU
In May, Reuters reported here that the European Commission was investigating whether Aspen Pharmacare charged excessive prices – up to several hundred percent – for five key cancer drugs and has withdrawn the drugs in some EU countries or threatened to do so in others.
“Companies should be rewarded for producing these pharmaceuticals to ensure that they keep making them into the future. But when the price of a drug suddenly goes up by several hundred percent, this is something the commission may look at,” European Competition Commissioner Margrethe Vestager was quoted as saying.
“Given that Aspen supplies similar products (i.e. Alkeran, Leukeran and Myleran) in South Africa, the commission has reasonable grounds to suspect that Aspen may be engaging in similar conduct locally,” said the CompCom.
“Moreover, Aspen appears to be either the only supplier or at least a dominant supplier of these products in both the South African and European markets. Given that Aspen’s products are listed as generic products, it is of concern that none of the markets have observed significant entry of other generic products by competing pharmaceutical companies.”
Aspen said the EU probe concerned several of its European subsidiaries, adding that it would work constructively with the commission.
US-based Pfizer is the only provider of its lung cancer treatment medication known as Xalkori Crizotinib in South Africa.
Based on information available to the CompCom, it suspects Pfizer “has and continues to engage in excessive pricing conduct” in the drug’s provision, contravening the Competition Act.
Its information suggests that lung cancer treatment is unaffordable in South Africa and medical aid schemes refuse to pay for the treatment.
Information available to the ComCom suggests Xalkori Crizotinib costs approximately R152 000.00 for 250 mg when bought through an agent, Equity. It seems there was a price reduction to R72 000 per month for 250 mg subsequently – conduct is suggestive of abusive behaviour in the drug’s supply.
Pfizer denies that it supplies the lung cancer product at the alleged price of R152 000. “We await the opportunity to be contacted by the commission to clarify the pricing for this product. We respect the process initiated by the commission and Pfizer shall fully cooperate with the authorities in their investigation.”
Roche told Moneyweb is has not yet received a formal notification by the Competition Commission in South Africa. “In the case where we receive a formal notification, we will be cooperating with the authorities, and will provide all required information and will respond to the allegation.”
The CompCom states it has reason to believe Roche and its US-based biotechnology company, Genentech “have and continue to engage in excessive pricing, price discrimination and/or exclusionary conduct in the provision of breast cancer medicine in South Africa”.
“Breast cancer is the leading form of cancer affecting women in South Africa. Medication known as Trastuzumab is recommended as an essential medicine by the World Health Organisation and is primarily used to treat breast cancer and some types of stomach cancer.
“In South Africa, only Roche’s branded versions of Trastuzumab are available and are sold under the names Herceptin and Herclon. Genentech provides exclusive marketing rights to Roche for Trastuzumab in South Africa.”
The commission says information in its possession confirms that breast cancer treatment is unaffordable in South Africa and many medical aid schemes refuse to pay the treatment based on cost. “As a result of exorbitant prices, most breast cancer patients in both the private and public sectors are unable to get treatment.”
As such, it has grounds to suspect that Roche and Genentech may be charging excessive prices for breast cancer medicines, including Herceptin and Herclon, “to the detriment of consumers and in contravention of the Competition Act”.
It adds that information available to it shows that Roche and Genentech charge its customers different prices for breast cancer medicines. “For example, in the private sector a 12-month course of Herceptin costs approximately R500 000, or more, if higher dosage is required. The Respondent offers substantially low prices for Herclon in the public sector.
“The choice of restricting sales to a particular sector is a commercial choice by the patent holder, in this instance the Respondent. This conduct may amount to price discrimination in contravention of section 9(1) of the Competition Act.”
According to GroundUp here, in February the Treatment Action Campaign organised a protest against Roche over the pricing of Trastuzumab. It handed over a memorandum to Roche demanding the price and that it stop cease litigation against competitors making generics.
Roche’s Aadila Fakier signed and accepted the memorandum, saying the concerns were noted and Roche would engage with relevant stakeholders on this.
Roche stated that it had been in negotiations with the Department of Health over the past year “to improve equitable access to Trastuzumab in the public sector. We have offered the Department of Health a significantly reduced and cost-effective treatment option….A final agreement has however not yet been concluded”.
Comment has been sought from Pfizer but wasn’t received before time of publishing.
2017/06/22 11:55 AM
In a recent opinion piece for The Mail & Guardian, Health Minister Aaron Motsoaledi argued that the legal system has created perverse incentives for lawyers in the form of commission-based fees and that this is increasingly driving lawyers to pursue medicolegal litigation even when some cases have no merit. He said this rise in litigation is not only pushing some gynaecologists out of practice but also threatens to collapse the public health system: “Nobody in their right mind would argue that victims of medical harm should be ignored. The problem we are faced with, though, is the ugly shape that medico-legal litigation has taken,” Motsoaledi said. If one is to accept the Health Minister’s proposition that medico-legal litigation is out of control - which is a proposition that may require more formal investigation and study - then, perhaps, the most appropriate government reaction is to map legislation to deal with such circumstances. Maybe a legislative solution is needed to cap damages in legitimate claims against medical practitioners.
This kind of solution could set out - in a manner consistent with existing legislation as well as the right to access courts in terms of the Bill of Rights and the Constitution - an appropriate dispute resolution mechanism for legitimate claims for when negligence occurs, and the claim is neither frivolous nor vexatious. It may be that medico-legal litigation has increased over the past years and it may be that such legal action has shifted to medical practitioners as opposed to the Road Accident Fund (RAF) because of the latter’s financial state. But the conclusion that healthcare workers are now the focus of legal action as a result of the RAF’s financial status is not the only plausible or reasonable conclusion that can be drawn in respect of a supposed increase in medico-legal litigation. Patients are also consumers. Since 2004, with the coming into effect of the 2003 National Health Act, patients have been provided with additional legislative rights concerning, among other principles, informed consent and the legal right to participate in decisions affecting their healthcare and treatment. Also, the 2008 Consumer Protection Act endowed patient-consumers with greater rights to understand the goods and services that they purchase, including medicines and medical treatments.
The coming into legislative existence of those rights coincided with information about medical treatments and options becoming more widely available to patients through the internet and social media. Patient-consumers are now better informed than ever before not only about their rights but also about concomitant obligations of medical personnel. The corollary to the empowerment of the patient-consumer is that, when matters go wrong, they are also aware of the numerous options available to remedy or redress such circumstances. It may be easy to lay the blame for increased litigation at the feet of alleged avaricious lawyers, but it is worth remembering that lawyers are - first and foremost - officers of the court. We are charged in society with the administration of justice along with the judiciary. Lawyers are a constituency that is not without the unscrupulous, but the checks and balances inherent in the legal system operate to eject frivolous and vexatious claims. Judges do not simply hand out cheques and lawyers - in the vast majority - do not pursue claims without merit to achieve a contingency payment of one percentage or another. It is also readily apparent that the quality of healthcare will affect the outcomes of medical and legal interventions. Poor quality healthcare inevitably leads to adverse but otherwise avoidable medical outcomes that, in turn, sponsor legal interventions and encourage medico-legal litigation.
Patient-consumers expect more for less and, when they receive less for more, they quite rightly turn to the legal system for help. One should therefore not underestimate the prowess of the patient-consumer in the context of today’s legislative framework and the rights afforded to them to access adequate and reasonable healthcare services as contemplated by the Bill of Rights. Patient-consumers will continue to enforce their rights by whatever legal means is available to them, especially where they are the recipients of inadequate medical services or treatment, which is the genesis of the harm that is legally actionable.
Neil Kirby is the director of health and life sciences practices at Werksmans Attorneys
2017/06/22 12:03 PM
The challenges facing the healthcare system are so immense that trying to describe them simply and then prescribing solutions is foolhardy. At the core of the challenge is the need for appropriate treatment and constant reflection about our capacity to provide it.

We have a steadily growing population and a steadily growing burden of non-communicable diseases. Diabetes, hypertension and heart disease are placing a tremendous burden on the system. The Department of Health has recognised this and taken strong action on the need for healthier lifestyles through awareness campaigns, zeroing in on tobacco and sugar use.

Through collaboration with the Treasury, it has fought to introduce taxes on sugary drinks. But taxes do not change mind-sets, and we must work in collaboration to tackle lifestyle diseases in a more pragmatic and calculated manner. Education and targeting.

But over the years, a crippling capacity shortage has become increasingly serious and now threatens to have a significant effect on the delivery of healthcare.

Since 1994, not a single medical school has been built in SA, although one is due to come on stream in the next few years.

The number of doctors and specialists has not kept pace with population growth, which has doubled since 1976.

Local medical schools produce about 1,300 doctors a year, when some estimates are that we need at least 4,000 a year. Across the system, we have half the global average number of doctors per 100,000 citizens.

The number of hospital beds available in 2010 in the public and private sectors was roughly at 1976 levels, according to work done in 2012 by Prof Alex van den Heever for the Competition Commission.
There is also a severe nursing shortage of between 40,000 and 80,000, depending on which report is referenced. According to a study by Prof Laetitia Rispel entitled Nursing: a Profession in Peril, nursing "is fraught with resource, management and quality of care problems". She points to "poor staying power, low energy levels, abuse of leave, suboptimal nursing care, split loyalties and accountability and erosion of professionalism".

The nursing shortage is particularly acute among "high end" or specialist nurses, who are easily lured away from difficult local conditions to posts overseas.

We have an immediate and increasing demand for appropriate interventions, while acknowledging that we are struggling to manage because we have too few resources.

Ideological positions need to change, and both sectors need to be involved in rectifying the situation on the understanding that initiatives put in place now will see fruition only when those health professionals have qualified in years to come. The longer we delay, the more entrenched the problem becomes.

Immediate steps must be taken on resources in whatever way possible because the healthcare reforms and systems that we adopt in the future will depend on us having overcome these challenges.
There is also a desperate need for a stronger primary healthcare system to support the department’s awareness campaigns to lighten the burden of non-communicable diseases.

There is hope. India and Brazil faced similar resource constraints and acted decisively. In countries where there were too few medical schools producing too few doctors, the private sector was roped in to help make up ground. India now has 355 medical schools and Brazil almost 200, with the private sector having contributed more than 50% of medical-training facilities. There are no private medical schools in SA.

It is not too late to take on these shortcomings, but it soon may be if we do not act quickly.
• Dr Bomela is CEO of the Hospital Association of SA.
2017/06/22 12:05 PM
A COHSASA accreditation award means the healthcare organisations was scrutinised while it underwent a rigorous quality improvement programme.

Healthcare facilities in Nigeria and Botswana, as well as in South Africa have been awarded accreditation by the Council for Health Service Accreditation of Southern Africa (COHSASA), a body that assists a range of healthcare facilities meet and maintain quality standards and so provide safe, quality services.

A COHSASA accreditation award means the healthcare organisations was scrutinised while it underwent a rigorous quality improvement programme, which it has been assessed against and complied with according to the standards of the International Society for Quality in Health Care (ISQua).

COHSASA itself is accredited by ISQua, the global body overseeing accreditation and quality improvement programmes in healthcare organisations in 70 countries around the world, as are its standards and its surveyor training programme.

Mediclinic’s Morningside hospital in Johannesburg received accreditation for three years while the Western Cape’s Worcester Hospital was accredited for four years.

Other accredited hospitals include Botswana’s Nkoyaphiri Clinic, Nigeria’s Chevron Hospitals in Gbagda and Warri, and the Shell Petroleum Development Company Hospital Port Harcourt, as well as the Cure Day Clinics in Bellville, Cape Town and Somerset West.

COHSASA also awarded the Graded Recognition Awards (Progress, Entry, Intermediate)  to Sekgoma Memorial Hospital and Selebi Phikwe Hospital in Botswana although they do not yet meet all the standards, COHSASA says facilities that are awarded this level usually go on to achieve full accreditation.

The two facilities in Ghana (C and J Medicare Hospital and Diagnostic Centre) and Botswana (Block 6 Clinic and Botshelo Diabetes Clinic) that have been awarded intermediate level with a focus survey will undergo a further onsite visit to assess their compliance.

The accredited hospitals will have to undergo vigorous testing again when their accreditation ends to ensure quality standards are maintained.
In the past 21 years of operation, the COHSASA has worked in over 600 facilities in both the public and private sectors in South Africa and several other African countries including Lesotho, Rwanda, Nigeria, and Kenya.
2017/06/22 01:14 PM
Life Healthcare Group announced on Monday that André Meyer will step down as chief executive and as a member of the board with effect from 30 June after three years at the helm of the second largest private hospital operator in South Africa.

The group said Meyer had delivered on his mandate given to him when he was appointed as chief executive in 2014. His mandate was to drive diversification across both territories and practice areas in order to meet the demands of a changing healthcare environment.

Life Healthcare said Monday it enjoyed a presence in India, Poland and across 10 European countries, which collectively delivers almost 20 percent of the group's earnings before interest, taxes, depreciation, and amortisation (EBITDA). Meyer said it was at this juncture, and after nearly 20 years in the healthcare industry, that he had decided to change course and focus on new opportunities.

"I have enjoyed the challenges and opportunities afforded to me during my tenure as CEO," Meyer said. "The group now enjoys a global footprint and investments in a broader range of strategic services outside of the acute care market and is well positioned across the full continuum of healthcare service delivery."

The board has appointed Pieter van der Westhuizen, the current chief financial officer (CFO) as the acting CEO. Van der Westhuizen has been with Life Healthcare for 18 years and has been the group CFO for the last four years.

The group said it had a capable and experienced management team in place and Van der Westhuizen will lead an operational executive board responsible for the operational delivery across the group and the delivery of the combination of benefits of Life Healthcare and Alliance Medical. Life Healthcare said the recruitment process to find a suitable CEO with relevant experience had commenced
2017/06/22 12:42 PM
Regulations concerning choice of health insurance products, the benefits they offer, and the consumer-protection measures to which they must adhere, came into effect at the beginning of April. If you are using these products, either as a substitute for medical scheme cover or to supplement it, or are looking at using them, you need to know what has changed and the type of products that are now available. The regulations under the Long-Term and Short-Term Insurance Acts, known as the demarcation regulations, were instituted in an effort to forge a clear boundary between medical scheme cover, which is governed by the Medical Schemes Act, and other types of health insurance, which are governed by the two insurance Acts.

Certain types of insurance policies that superficially resembled medical scheme cover will be phased out. The reasons for the regulations are twofold:

• They make sure consumers are better informed of the differences between health insurance and medical scheme cover; and,

• They ensure that the cross-subsidisation within medical schemes between healthy and sick members, which is critical for schemes’ well-being, is not undermined.

All new health policies have had to comply with the new requirements since April 1. Existing long-term insurance policies will have to align to the regulations as and when such contracts are changed or renewed. Existing short-term insurance policies will have to align by January 1 next year. Product providers are obliged to communicate clearly that health insurance policies, particularly hospital cash plans, are not a substitute for medical scheme membership. Roseanne Murphy Harris, the president of the Actuarial Society of South Africa, said the regulations were much needed. She said confusion over the benefits offered by health insurance policies versus medical schemes has unfortunately resulted in consumers inadvertently sacrificing adequate medical cover by opting for products not appropriate for their circumstances. This confusion also restrained medical schemes from developing a broader and more sustainable membership pool, which is crucial for the financial well-being of schemes. These views are echoed by Gerhard van Emmenis, the acting principal officer of Bonitas Medical

Fund welcomed the demarcation, as it is designed to protect consumers and will assist in stabilising the medical schemes industry. He said the demarcation will further aid in clearing the misperception that exists between health insurance products and medical schemes. The main types of health policies affected are:

• Gap over which is used to supplement medical scheme cover. It makes up the difference between what your scheme pays out for hospitalisation and inhospital specialists and what hospitals and specialists actually charge.

• Hospital cash plans which are often taken out by people who cannot afford medical scheme cover but need some sort of cover for healthcare expenses.

These policies pay out a fixed amount per day for each day you are in hospital.

• Primary healthcare policies which are policies from insurers that resemble basic medical scheme cover, paying for certain medical consultations and procedures.

These will be phased out over the next two years while the Department of Health and National Treasury look at ways of integrating them into the medical scheme framework as low-cost medical scheme options.

Van Emmenis said one needs to remember that health insurance products are sold by insurance companies, which are for-profit organisations. Medical schemes, on the other hand, are non-profit (although the administrators of such schemes are for-profit). Also, insurance contributions are not tax-deductible, whereas tax credits are received for medical scheme contributions. Murphy Harris said medical scheme cover outweighs what one gets from a short-term insurance policy. It helps to pay for a comprehensive range of healthcare needs and expenses, offering different levels of benefit options. It also provides guaranteed prescribed minimum benefits, which provide for full cover for treatment in medical emergencies, 270 life-threatening conditions and 25 common chronic conditions.

Gap Cover Policies

Gap cover policies, which have become popular as a way of supplementing medical scheme cover, have been allowed to continue under the demarcation regulations.

Whereas gap cover limits were determined by individual insurers in line with industry norms (you could buy cover of up to R1 million a year), the new regulations limit cover per individual to R150 000 a year. Murphy Harris said the benefit cap on gap cover may help to counter escalating healthcare expenses, because in the past some healthcare specialists may have increased their fees according to how much insurers paid, contributing to medical inflation. Mike Settas, the director of Kaelo Xelus, a provider of gap cover, disagrees with this view. He said there are many reasons for the high fees specialists charge, and capping benefits will have no effect on medical inflation. First, Settas said, it is simply a matter of supply and demand: specialists in short supply in a particular discipline will charge more for their services. Second, specialists face escalating costs, particularly for liability insurance - gynaecologists and obstetricians now pay about R1-million a year to cover themselves when faced with malpractice suits.

He said isolated practitioners may have charged more if a patient had gap cover insurance, but this was the exception. Settas said the new regulations will not have much of an effect on business, and very few claims in the past exceeded the now imposed R150 000 annual limit. He expects the gap cover market to grow now that the uncertainty surrounding the future of these products has been removed and, more pertinently, because medical costs will continue to soar. Van Emmenis said you should be aware of the following when you buy gap cover:

• Cover differs from policy to policy in terms of the percentage pay-out, as well as any waiting periods (how long you must wait before you are covered) or exclusions (events or circumstances in which you are not covered);

• You may need gap cover even if you have a top-of-the-range medical scheme option, because there might still be gaps between what your scheme pays and the amounts specialists charge; and,

• Never assume that all costs will be covered.

He said gap cover is by no means a cure-all solution to avoid co-payments.

Hospital Cash Plans

Hospital cash plans are intended to pay a daily amount towards non-medical expenses that might arise when you are hospitalised, such as childcare or loss of income.

However, Murphy Harris said, these policies are often used as low-cost cover by people who mistakenly believe that the benefits will cover the costs of hospitalisation, leaving them without adequate medical protection. Moreover, she said, many hospital cash plans pay benefits only after policyholders have spent as many as four or five days in hospital, which happens only in rare cases. Hospital cash plans have therefore been limited to paying up to R3 000 for each day spent in hospital to a maximum of R20 000 a year. The new regulations further stipulate that benefits should be paid after two days spent in hospital, and must be calculated from the first day on which you are hospitalised. In other words, if you spend only a day in hospital, you will not be covered, but if you are in hospital for longer than that, you will be paid out for all days, including the first day, up to the maximums.

Primary Healthcare Policies

Primary healthcare policies offer a limited range of healthcare benefits, such as visits to general practitioners and emergency medical care. Because they are considered to perform the business of a medical scheme, these products will be phased out. Murphy Harris said insurers are able to apply for a two-year exemption under the regulations in order to protect the rights of policyholders, as these policies target low-income earners. Consumer Protection Requirements Murphy Harris said rules introduced by the demarcation regulations for the protection of consumers include the following:

• Commission payable to insurance brokers on health insurance policies has been limited to prevent mis-selling. Commission is now set according to monthly premium bands, ranging from a maximum of 20 percent of premiums less than R300 a month, to a maximum of five percent of premiums above R1 200 a month.

• Insurers are prohibited from discriminating against individuals by refusing them cover or increasing their premiums on the basis of their state of health, because they have a disability or because they are pregnant. However, insurers may price premiums based on the age of the policyholder when taking out a contract, provided that this pricing affects all new policyholders of the same age.

• Insurers may impose a general waiting period of up to three months on policyholders before they can submit a claim, as well as a condition-specific waiting period of up to 12 months. This will apply to individuals who have been diagnosed with or sought treatment for an illness or condition in the year preceding the date on which they take out a new policy.
• As part of the Treating Customers Fairly principles adopted by the financial services industry, the terms of policies, the premiums payable, as well as any restrictions on benefits, must be disclosed when a policy is taken out.
2017/06/22 01:05 PM
World-renowned plastic and reconstructive surgeon Dr Frank Graewe recently completed complicated surgery to remove severe keloids from a patient who has been unable to work for more than a year due to his condition.
Aaron Hairundu, a patient from Windhoek, suffered from severe keloids that left him unable to work as employers were reluctant to hire him. Hairundu was in extreme pain due to the severity of his condition.
He had an intricate operation in Cape Town last month, performed by Graewe, and is recovering well.
 “Aaron’s keloids were extremely severe and covered the majority of his upper body. He was in a lot of pain and hasn’t been able to work for the past year,” Graewe said.
“We removed as much of the scar tissue as possible, and he will undergo radiation therapy to decrease the chance of the keloids returning.”
Keloids is the body's abnormal response to injury, and the scar tissue continues to grow beyond its normal bounds. The condition is difficult to treat as there is a very high risk of the keloids returning.
Treatment usually begins with steroid or cortisone injections into the affected area to try to control the abnormal growth. Only in severe cases is surgery recommended.
“Due to the severity of Aaron’s case, surgery was the only treatment option available,” Graewe said.
“We're hopeful that with the combination of the surgery and radiation therapy, his results will be successful. His surgery was very intricate. Due to the extent of his keloids, there was very little excess skin left to suture, so we had to use skin grafts.”
Hairundu was able to undergo the surgery at the Louis Leipoldt Mediclinic in Bellville due to the generosity of three Namibian sponsors who covered his air ticket and accommodation.
“Aaron’s surgery was a success and we're happy with the results at this stage. Only time will tell whether he will require follow-up surgery,” Graewe said.
2017/06/22 01:13 PM
Knysna - Green Valley in Plettenberg Bay and Buffalo Bay next to Brenton-on-Sea was evacuated on Saturday morning as windy conditions complicated firefighting efforts in the area.
The suburbs were temporarily evacuated as a precautionary measure, municipal spokesperson Fran Kristen said.
The George local municipality deployed five Go George busses to assist with evacuations.
Social media reports suggest that Sedgefield has also been evacuated, but Knysna municipality denied evacuations taking place and said fires are being monitored in the area.
On Friday afternoon fires in the Eden district were 85% under control. Several flare-ups have however occurred on Friday evening and Saturday morning which was sustained by windy conditions.
In a statement, SANParks said winds of up to 42km/h were expected at 11:00 on Saturday morning.
Western Cape Local government spokesperson James-Brent Styan said an additional South African National Defence Force (SANDF) helicopter has been deployed.
Eleven helicopters have been deployed to the Eden District by Saturday morning with an additional helicopter from Working on Fire on its way to the area.
George municipality said fires caused no structural damage in the municipality.
Seriously ill patients from the Geneva clinic were evacuated to the Mediclinic due to serious smoke inhalation, but fires did not damage the clinic building, municipal spokesperson Chantel Edwards-Klose told News24.
Local authorities confirmed that 300 buildings have been destroyed by the fires since Wednesday and roughly 4 000 people remain displaced.
Knysna municipality urged residents to use water sparingly as water infrastructure has been stretched to its capacity.
The municipality was declared a drought disaster zone in May.
Kirsten said heat created by recent fires caused many pipes to burst and increased water leaks. She requested residents to reports leaks to the municipality by phoning 044 302 6300.
"Some residents have noticed the brown colour of the water. This is purely aesthetic and is still safe for use," Kristen said.
The municipality is also experiencing sporadic power outages due to kilometres of electricity lines destroyed.
The municipality appealed for donations of mattresses, sleeping bags, bottled water and sanitary products to be used specifically for the elderly people in the area.
Donations can be dropped off at DHL centres across South Africa.
News24 earlier reported that local police has not received any reports of missing people and encouraged residents to report missing people to police as soon as possible. Missing people can be reported to 044 302 6687 or 08600 10111.
Seven people have been arrested for looting following the blaze.
Local historian Phillip Caveney said the last time a fire of this magnitude hit the district was in 1869.
This type of blaze occurs in 150 year cycles, he said.
2017/06/22 01:11 PM
Cape Town - South Africa was ranked last among 19 nations in a global survey that measured healthcare system efficiency – the ability to deliver maximum results at the lowest possible cost.
The Future Health Index, commissioned by Dutch tech company Philips, gives a snapshot of current realities, and how well a country’s healthcare system is set up for the future.
The study asked 33 000 ordinary people as well as healthcare professionals how they viewed health care in their country. The authors then compiled data of the actual reality that citizens had to contend with, using input from leading academic and global non-profit organisations.
The index showed that South Africa’s efficiency ratio was the lowest out of the 19 countries in the study, which included countries such as  France, the US, Argentina, United Arab Emirates, China and Brazil. South Africa scored 4.4 compared to the group average of 10.5.
But despite the health index’s worrying findings, South Africans perceived health care much more positively than what actually happened on the ground.
South Africans felt that they have more access and greater integration of the healthcare system and better adoption of connected care technology, than they have in reality, researchers said.
“Where there are distinct gaps between reality and perception, it is harder to design a clear plan for future development, as both the reality and perception need to be addressed in order to advance,” researchers warned.
Also most South African also believed that that were in better health than they actually were.  The majority (80%) of the respondents rated their current health positively, with either a good, very good or excellent score. At the same time just one third (33%) of healthcare professionals agree that the overall health of the population in South Africa was positive.
“With these findings as a guiding light, we are engaging all relevant parties around the table to drive the debate,” said Jasper Westerink, CEO of Philips Africa. “The index uncovered a number of significant areas where our healthcare system must transform if we are going to succeed in delivering long-term value-based care.”
GDP health spend
Authors of the report attributed South Africa’s poor efficiency score to average healthcare spend as a percentage of gross domestic product (GDP) that delivered below average health outcomes.
South Africa spends 8.8% of its GDP on healthcare, just over R4 trillion, which placed it in the mid section of the 19 countries. The US spent 19.1% of their GDP on health and France 11.5%. The lowest spender was the UAE with 3.8%.
Westerink said in a country such as South Africa with a wide variety of healthy care – public or private – to bring it into one efficient chain is a huge challenge.
Private vs Public
Health Minister Aaron Motsoaledi recently said the private sector spent 4.4% of GDP on health but only provides care to 16% of the population, while the public sector spent 4.1% of GDP on health but had to provide care to 84% of the population.
A South African pulmonologist working in the public sector, told researchers that as far as availability is concerned he believed that South Africa possessed excellent healthcare facilities. “However, if you look at the government sector, in most of the urban centers resources are very stretched and because of this the quality of care at primary levels is not as good.”
The index showed that 56% of South Africa’s health care professionals believed that their time should be spent on prevention, while 52% that treating the ill was critical. The large gap between the perception of the healthcare system and its realities, indicate ample room for growth.
Nearly half (46%) of the respondents think the health system in the country is unintegrated, while healthcare professionals feel even more strongly about this (74%), an increase from 2016 (58%).
“The general population often have a perception that healthcare is integrated and people only find that the integration is not there once they are a patient in the system,” said Westerink.
2017/06/06 08:49 AM
Medico-legal litigation has exploded. As of March 2016, claims against the health department from the previous five years stood at more than R37billion. By October that year, the figure had jumped to R51billion — or a third of the whole public healthcare budget if we had to pay every cent.

The medico-legal litigation pandemic threatens not only our health system but also the very existence of our mothers and children. When some see these figures, their first reaction is to condemn the health department and accuse it of absolute carelessness. Please be careful before drawing such conclusions.

Ask yourself first: But what has changed? It is common knowledge that, over the decades, an overwhelming number of medico-legal litigation cases were lodged against the Road Accident Fund (RAF). The RAF has since been litigated into a state of near bankruptcy and is finding it difficult to even pay legitimate claims.

The minister of finance has tried to raise the fuel levy to fund the RAF, to no avail. Lawyers who used to make a living out of the RAF are now focusing on the healthcare system. There is a perception, a wrong one, that only the public healthcare system is being sued. Let me inform you that lawyers are pursuing both the public and the private healthcare systems.

This litigation has grown exponentially. The relentless pursuit of cases is not necessarily about what is happening currently: most cases are based on incidents that happened 20 to 25 years ago. It is an inherent problem of any healthcare system that undesirable outcomes such as negligence, malpractice or adverse events could occur. Nowhere in the world does a healthcare system aim for such incidents of "medical harm" to happen. But they do. Nobody in their right mind would argue that victims of medical harm should be ignored.

The problem we are faced with, though, is the ugly shape that medico-legal litigation has taken. Not all doctors are experiencing litigation to the same extent. Obstetricians and gynaecologists are the prime targets, followed by neurosurgeons, neonatologists (specialists dealing with babies during the first 28 days of life) and orthopaedic surgeons.

Why is this so? They work in areas where adverse events or complications are more likely to happen. No child deserves to arrive in this world with a condition such as cerebral palsy (brain damage that results in a physical disability that affects movement and posture). We believe that such children deserve compensation.

The health department does not have a problem with the concept of compensation but rather with the way in which it is being conducted. Some lawyers literally raid schools for the disabled, sniffing for children born with cerebral palsy, in order to litigate against the hospital or the obstetrician who delivered the baby.

Such claims increase by the day, because South Africa's law system allows lawyers the option to operate on a commission basis instead of charging clients fees. At the conclusion of a case, the lawyer takes a cut of the amount awarded to the victim, also known as a "contingency fee". Lawyers are allowed to take up to 25%. In some RAF cases, however, unscrupulous legal practitioners have taken advantage of uninformed patients and family members and awarded themselves up to 80% in contingency fees.

The contingency fee system is an American one and is part of the reason why the United States spends 18% of its gross domestic product on health. It is also leading South Africa to a precipice. When a snake, in the form of medical harm, enters your house, you do not bomb the whole house with your children inside; you try to find a better way to rescue your children. In order to practise medicine in the private sector, doctors have to buy indemnity or insurance, which will pay out in legal cases where they are found guilty of negligence.

Those in the state sector don't have to, because it is the minister of health who gets sued. About eight years ago, obstetricians and gynaecologists paid R78 000 a year for insurance. This year, the Medical Protection Society's insurance costs R800 000 — an increase of 925%. The South African Society of Obstetricians and Gynaecologists has pleaded with the Medical Protection Society to reduce this amount. But its response was along the lines of: "You're not being litigated against for what you are doing now or what you may do in the future, but mostly for what you did in the past. We have to charge a high premium if we are going to be able to settle your litigation debt." The result?

Obstetricians and gynaecologists are closing their practices and leaving the profession. Many of those who are brave enough to continue — or who have no option because they are too old to change professions — refuse to deliver babies and refer pregnant women to public hospitals. Young doctors are refusing to specialise in obstetrics and gynaecology. Where will pregnant women go? How is the country going to secure safe pregnancies for mothers and bring healthy babies into this world when doctors who are supposed to perform such functions are being litigated out of existence? Lawyers argue that litigation is being pursued as a form of social justice for the victims of medical harm, and is done solely in their interest.

The more they litigate, they say, the more pressure there is on doctors to provide better quality services. The pursuance of social justice sounds noble but why, then, charge such high contingency fees? Is it in the interest of victims that practices are now being closed down? When your child commits mistakes, do you take a sledgehammer and bludgeon him or her out of existence or do you devise decent and civilised corrective action? As the health sector, we accept that the best solution for this explosion of litigation is for health workers and systems to reduce incidents that may lead to litigation.

When health workers or hospitals are found guilty of negligence however, victims should be compensated. But our country can no longer continue with a compensation mechanism that allows the health sector to be wiped out. We are looking at designing a better system, such as the one that Denmark uses, where medical injury claims aren't handled by the courts but by medical and legal experts who review cases at no charge to patients. The outgoing director general of the World Health Organisation, Margaret Chan, once said to me: "Minister, your country needs a better mechanism of compensation. The contingency fee system is the worst that America ever bequeathed to the world." Aaron Motsoaledi is the health minister.

Comment by Aaron Motsoaledi
2017/06/06 08:50 AM
Medical devices will now be regulated, with the newly established regulatory body, the South African Health Products Regulatory Authority (Sahpra), replacing the Medicines Control Council (MCC) from yesterday. Medical devices and complementary medicines have been unregulated as the MCC dealt only with conventional medicines.

Sahpra came into being when the Medicines and Related Substances Amendment Act of 2008 was finally signed. The body is not yet operational as Health Minister Aaron Motsoaledi is yet to appoint a board. Sahpra came into being to relieve extensive delays at the MCC in approving new medicines and clinical trials. Sahpra will also regulate foodstuffs, cosmetics, disinfectants and diagnostics.

Stavros Nicolaou, head of industry association Pharmaceuticals Made in SA (Pharmisa), said the new body would be able to generate its own income, allowing it to use modern systems and retain staff that were often overwhelmed by large volumes of work and prone to being poached by the private sector. He said the workload of the MCC had quadrupled but the funding hadn’t matched. The new regulator will be clearing a backlog of more than 2 000 applications awaiting registration by the MCC.

Pharma Dynamics CEO Erik Roos said Sahpra could usher in a new and much more effective era for the local pharmaceutical sector. He said Sahpra’s new structure will follow a similar model to the US Food and Drug Administration in that it will be more independent than the MCC.
2017/06/06 08:51 AM
South Africans are faced with the constant increases in the cost of living and an ailing economy, forcing consumers to cut down on spending across the board. For a small percentage of the population, healthcare costs are covered by medical aid, but only an estimated 16 percent of South Africans have such coverage while the rest rely on an already overburdened healthcare system. Continuing downward pressure on the economy is pushing even those with medical cover to either reduce it, or outright terminate their membership just to make ends meet, leaving more and more South Africans vulnerable. While there are several factors contributing to the increase in private healthcare costs, including the volatile exchange rate and its impact on the cost of importing medical equipment, the rising costs of medication, doctors’ fees, the increasing average age of principal members on the schemes, the biggest culprit is private hospital costs. According to the Council for Medical Schemes’ 2014-2015 report, hospital fees constitute the bulk of fees paid by medical schemes with total hospital expenditure amounting to 37.6 percent, of the R124.1-billion that medical schemes paid to all healthcare providers in 2014.

This was an 11.6 percent increase in expenditure on hospitals from the previous year and this trend has not abated. Whether we like it or not, the reality is that healthcare costs in SA - especially private hospitals - have become too expensive. The compound hospital cost escalation of 15 percent per annum is unaffordable and is not sustainable in our healthcare environment. However, some 70 percent of surgical procedures, currently done in acute hospitals, can safely be performed in a day surgery facility. In South Africa, day hospitals offer significant opportunities to improve the efficiency of private hospitalisation. Locally, only approximately 13 percent of all surgical procedures are attended to in day hospitals, an extremely low figure compared with the almost 70 percent international utilisation of day hospitals.

The potential to increase the use of day hospitals is significant, bringing clear benefits to both patients and medical schemes. Several factors influence the cost model of day hospitals: no large catering facilities, no ICU or specialised theatre, no overnight beds to cater for and no after-hours staff costs, no emergency unit and more reasonable per minute theatre fees compared to an acute facility. We have moved on since the early 1980s where day case surgery was more focused on dental care and minor procedures. Day hospitals across the world are transforming the surgical experience for millions of patients by providing them with a more convenient alternative to hospital-based surgery. It’s time for South Africans to take advantage of the many benefits of this option.
2017/06/06 08:52 AM
South Africa has a dire shortage of registered nurses, yet those wanting to enter the profession are now finding a closed door.

The pipeline of registered nurses in South Africa has ‘paused’ – and hospitals and students are being affected by legislative bungles halting the flow of skills into the sector. To add fuel to the fire, working conditions discourage retention.

The sequence of events is startling, especially for a country where, according to Moneyweb calculations and South African Nursing Council (SANC) statistics, there were only 5.14 nurses per 1 000 people in 2016.

Dr Wilmot James, DA shadow minister of health, notes in his Politicsweb article here: “Having a critical mass of professional nurses in hospitals reduces the risk of patients dying by 8%.” It also significantly cuts the incidence of patients acquiring additional health problems while in hospital.

“We have a significant shortage of qualified professional nurses,” says Debbie Regensberg from the Society of Private Nurse Practitioners of SA. “And the shortage is about to become critical.”
The looming crisis began with a sweep of nursing college closures and mergers in the late 1990s, according to Health Systems Trust training unit technical advisor Dr Joan Dippenaar. This led to significantly fewer nurses being trained in State facilities.
Until now, private hospitals with their own colleges filled the gap – but this pipeline has been plugged.

Nursing education now falls under the Department of Higher Education, rather than the Department of Health (DoH). The Strategic Plan for Nursing Education, Training and Practice (2013) came into effect that year and introduced new qualifications. Nursing education programmes approved by SANC prior to the promulgation of the National Qualifications Act, 2008 were terminated in June 2015.

As a result, private training facilities discontinued all programmes in 2016, and have not taken on any new students since then. The old curriculum continues in public training facilities until 2019.

But many private nursing education institutions have yet to be accredited. And those that have received accreditation face another challenge, and this one is insurmountable. As Unisa lecturer Professor Mokgadi Matlakala points out in her paper here: “The new curricula are yet to be approved.”

Until SANC, together with government, finalises and publishes updated scopes of practice, the new qualifications can’t be offered.

The situation is being further aggravated by the fact that thousands of posts in State hospitals have been frozen.

The hiring freeze isn’t just keeping qualified health care workers from securing work in State hospitals – it has led to a licensing hold-up. A one-year practical training stint in the public sector is a mandatory requirement of professional nurse training. There are not enough posts in the public sector for students who complete their studies, says Professor Laetitia Rispel, head of the School of Public Health at the University of the Witwatersrand, here.

In a May statement, Hospital Personnel Association of SA (Hospersa) general secretary Noel Desfontaines said it is alarming that the DoH is not filling these vacant posts. Hospersa has raised the staff shortage issue with the DoH on numerous occasions “with little response.”

Some private hospital groups are bringing in professional nurses from India and other English-speaking Asian countries, particularly for their operating theatres and ICUs, says Regensberg.

But this option has its own challenges. A large number of qualified nurses from overseas have applied to the South African Nursing Council (SANC) for registration, but the process can take three to five years.

South Africa also has an ageing nursing population. Approximately half of all licenced nurses are over 50, with only 5% under 30. “There will be a critical shortage of nurses in the near future when all the skilled professionals, teachers, managers and clinical specialists retire,” says Dippenaar.

There’s also the brain drain, although emigration per se doesn’t seem to be a major problem. South African nurses can be found working overseas (primarily in Saudi Arabia, UAE and UK) – but most go on fixed-term contracts, then return.

Taking up better-paying positions overseas is understandable. Nursing is a notoriously poorly paid profession. South Africa has three categories of nurses, determined according to level of training: professional registered nurses (four years), enrolled nurses (two years) and nursing assistants/auxiliaries (one year).

Those with a post basic degree are able to find higher remuneration, while specialists such as critical-care nurses can demand higher salaries.

Even so, it’s not unusual for nurses to moonlight, holding down two jobs to make ends meet. As Regensberg points out: “A newly-qualified pharmacist with a four-year degree and two years of practical experience has a starting salary of R35 000 per month, while a professional [registered] nurse will be fortunate to earn R18 000, yet has to take responsibility for life-and-death decisions in the absence of other healthcare professionals.”
Then there are the working conditions – believed to explain why an estimated 18% of SA’s registered nurses don’t practice.

Working conditions were found to be so poor at public health facilities that the Department of Labour issued the DoH with a Section 7 notice over Occupational Health and Safety contraventions late last year. “The report showed dismal results from the first round of inspection where the overall compliance for the country was rated at 22%,” Hospersa says here.

Dippenaar says the challenges facing the profession are further influenced by the shortage and uneven distribution of doctors between sectors, provinces and urban rural areas, compounded by a shortage of resources.

Thousands more nurses needed

In her paper, Matlakala noted that the health system was short of 20 815 nurses in 2015.

At the end of 2016, SANC had 21 339 student nurses and 287 458 registered nurses – the latter up from 203 948 in 2007 (46%). In the same period, the population grew from 47 850 million to 55 909 million (16%). Thus, the ratios have improved – but with only 5.14 nurses per thousand people in 2016, we are well below global averages.
There is clearly an urgent need for changes to the current situation regarding training, accreditation and licensing. Creating a favourable workplace environment would also go a long way towards keeping professional nurses in their posts.

SANC was given an opportunity comment and hadn’t by publication.
2017/06/06 09:20 AM
Recent calls by the Health Professions Council of SA (HPCSA) to its members not to enter into agreements with medical schemes specifically on Global Fees and similar arrangements have raised an important discourse across the healthcare funding industry.

The Board of Healthcare Funders of Southern African (BHF) supports the NHI policy direction and refers to the green and white papers that place emphasis on alternative reimbursement models, stating that in this context, global fees are important tools in the achievement of accountable and affordable healthcare, and the establishment of guidelines in the implementation of such alternative reimbursement models is vital. When one considers that the private sector will play an important role in National Health Insurance (NHI) delivery and can help SA’s NHI leapfrog many of the challenges experienced in other geographies, the need for new models of reimbursement that drive quality outcomes and not utilisation is crucial.

The implementation and adoption of alternative models of provider reimbursement is crucial to the sustainability of the healthcare sector. South African consumers have faced unavoidable medical scheme tariff increases far beyond inflation and as a result, an erosion of benefits for the past decade.

“Relevant healthcare stakeholders need to find common ground and collaborate through mature leadership on the issues of spiralling benefit utilisation and costs, finding agreeable ways to reimburse providers that are premised on quality outcomes for patients, transparency and accountability for patient outcomes by providers,” says Dr Ali Hamdulay, Chairperson of the Board of Healthcare Funders of Southern Africa (BHF).

Alternative Reimbursement models such as Global Fee models provide a single payment to a healthcare team to cover all the tests, procedures, drugs, devices and rehabilitation needed for a patient’s condition and are premised on accountability for the quality of care provided by each team member— a vastly different approach to the current fee-for-service model.

The Board of Healthcare Funders has emphasised that it’s not about imposing models on healthcare providers, and that it’s essential that funders and healthcare providers work collaboratively to find the right reimbursement models that work towards better managing risks and costs, serve the interests of the patient and the health professional’s ability to act in the best interests of the patient.

“The alternative reimbursement models also stimulate the creation of centres of excellence by increasing competition and accountability between healthcare providers – teams with consistently better healthcare outcomes are likely to receive more patient referrals from schemes based on quality outcomes. This will also have the effect of driving more competition between healthcare providers, which in turn drives better outcomes, and which will have the effect of improving pricing as well. All of this ultimately equates to the best care and outcome for the patient and medical scheme member,” explains Dr Hamdulay.

The BHF adds that the concerns raised by healthcare providers that global fee models will create an environment of underservicing which compromises patients are moot. “Within such a model, there is little room to underservice since the focus is on outcomes and most crucially, an increased demand for accountability by the healthcare provider for such outcomes. Essentially a global fees arrangement paves the way for schemes to contract with specific suppliers because they offer the best quality, transparency and outcome, and not the lowest fee,” adds Dr Hamdulay.

Ultimately, how the reimbursement models of the future are built is important, and this must be done collaboratively. “We have strong leadership in the healthcare sector, but what we need is stronger leadership that is pulling towards what should be our shared objectives – patient care and quality healthcare outcomes. If we can collaboratively solve these challenges with funders, specialists and patient advocacy groups, we can work towards creating models that represent fair outcomes for all parties and solve some very real and fundamental challenges in the private healthcare industry. The interconnected nature of the entire healthcare supply chain emphasises the need for a strategic approach that involves all role players to find a way to standardise benefits in a manner in which we can measure the quality and cost of care, and in turn use the outcomes data to better define the future healthcare model for the country and all South Africans,” concludes Dr Hamdulay.
2017/06/06 09:20 AM
The Competition Commission’s health market inquiry has published research reports in its investigation of the private healthcare sector in SA. The aim of these reports is to stimulate debate and ultimately reach a finding on what could be done to fix a range of problems in the sector.
These reports have generally dealt with core issues, and stakeholders have had ample time to comment, contributing to the process. Last Friday, however, the inquiry changed course when it published its latest research note considering cross-ownership and cross-directorships in the private health sector.
This report is littered with allegations of implied misconduct against many of the larger private healthcare players, while not a shred of evidence is produced. In this form, it reads more like the next chapter of the white monopoly capital saga than a research report produced by a well-respected body such as the Competition Commission. This is a pity for many reasons.
The debate on the role of private healthcare in SA is already polarised. The latest disagreements on the role of medical schemes in National Health Insurance are a good example, with Cosatu insisting that medical schemes should play no role.
The health market inquiry research report lists cross-ownership and cross-directorships of mainly two holding companies: Remgro and AfroCentric. There is absolutely no in-depth discussion of how these cross-holdings are supposed to limit competition, yet the conclusion drawn is stark.
"The ownership structures in this note indicate complex and diffuse interrelationships between firms," it finds. "It stands to reason that these structures may provide disincentives to vigorous competition so as not to disadvantage the investment holding companies’ financial interest."
This statement has to be unpacked to see what the inquiry means by it.
There is a large body of literature in competition law and economics that illustrates how cross-ownership could present competition problems. The research report refers to some of this research.
The first requirement for any such (traditional) theory of harm to hold is that the firms affected must be (horizontal) competitors. The director in the holding company of, for example, a hospital group can only have an incentive to act in a collusive or anticompetitive manner if there is some interest in a competing hospital group.
This is the type of problem the tribunal and the Competition Appeal Court grappled with in the Primedia/Capricorn merger — where the radio stations were direct competitors.
The health market inquiry’s report, however, does not even put forward a theory of horizontal competitors colluding through cross-holdings. This traditional theory must therefore be dismissed.
The report seems to have another theory of harm in mind. The example it cites is a holding company that will not invest in managed care when it will hurt the profits of the hospital group in which it has an interest.
In practice, this means that the Remgro director who sits on the Discovery board will now try to make the Discovery managed-care side of the business less efficient in order to ensure that Mediclinic has more patients who stay longer in their hospitals, yielding higher profits. Let us ignore for the moment the fact that this is clearly unethical behaviour and focus on the economic criteria to test whether this could happen.
The economic test asks whether this director has the ability and the incentive to act in such a manner. In terms of ability, one can assume that the Remgro director on the Discovery board is likely to be outnumbered by directors who presumably have the profitability of Discovery as their main goal.
It is unclear how this director will convince his fellow board members to hamstring the Discovery managed-care business in order to benefit Mediclinic (a group in which it has no direct interest).
In terms of incentives, the economics should again provide some guidance. One needs to weigh the benefits to Remgro of reduced profit at Discovery versus some increased profit at Mediclinic. Here, shareholding percentages of the holding company should give some indication of these incentives and yet the health market inquiry makes no attempt to analyse these.
But most fundamentally, this theory shows no understanding of the functioning of healthcare markets. In fact, it would be much better for the Remgro director — assuming he has the ability and incentive and can live with his conscience — to grow the Discovery managed-care business.
Why would this be the rational thing to do?
Hospitals actually do not want healthy patients in their beds (they do not want patients to stay for longer than necessary). There is much more money to be made in treating sick patients, which implies that the incentives between the managed-care organisation and the hospital group are not misaligned in terms of profits.
All this illustrates the folly of the health market inquiry’s flawed reasoning. One should as a first principle consider the fact that the behaviour suggested by the report is completely unethical.
These are serious allegations against some of the larger healthcare companies and their directors. A first step would have been to test the facts with them. A factual mistake worth pointing out in this regard is that FirstRand does not have any interest in MMI (contrary to what is claimed in the report).
The inquiry acknowledges that it has produced not a shred of evidence in the report: "The health market inquiry is not in a position to draw any conclusions on the nature of the cross-directorships observed or the effects thereof without conducting further analysis of the relationships and operations of the companies."
And yet this does not stop it from concluding that there might be "disincentives to vigorous competition".
This report is a step in the wrong direction. Given the serious nature of the implied allegations, one would expect the relevant parties to object strongly to these types of unfounded claims — as they should.
This will simply cause unnecessary delays in a process that seems to have lost quite a lot of steam already.
• Theron is MD of Econex and extraordinary professor at the University of Stellenbosch economics department.
2017/06/06 09:28 AM
Discussions and debate are focused on state capture and its effect on the economy, but there is another beast eating away at productivity, hurting the economy and undermining our health system. South Africa is open for medical fraud business. Medical fraud manifests in two ways: bogus doctors in practice and bogus medical certificates issued to rob employers by keeping an employee away from work while earning a salary. The phenomenon of suspiciously qualified or unqualified doctors opening practices in some townships and attracting unsuspecting patients has become a concerning norm. Just recently a bogus doctor was caught and arrested at his Mpumalanga surgery in front of patients, some of whom he had prescribed highly regulated schedule 4+ drugs.

These bogus doctors - and even dentists and specialists - are found not only in township surgeries but also in hospitals. Although one may argue that the responsibility rests with the patient to ensure that they visit qualified doctors, it is difficult to check the credentials of the doctor before a consultation.

Up to now, what our medical field seems to lack is a robust, impenetrable system to vet medical professionals before employing or certifying them as good to practice. Issuing a medical certificate to keep an employee away from work without need is fraud and both the doctor and the patient need to be held accountable.

Albeit with very little remedial action taken, fraudulent medical certificates have been a problem for years. Worse still, if you are sick of work or have a hangover, you can but an authentic medical certificate on a street corner. At a tavern in the North West, you can buy a drink and a sick note at the same time. Depending on how long you wish to stay away from work, it will cost anything between R60 to R200 without even visiting the doctor’s rooms. The economy loses R55.2-billion annually to sick leave, according to an article in September 2013 quoting Adcorp Holdings’ employment index of that year.

There is an IT solution aimed at combating the issuing of fraudulent medical certificates. It was designed and developed by young entrepreneurs from QwaQwa in the Free State. What the system does is to allow only a qualified doctor - verified by the Health Professions Council of South Africa as good to practice - to issue a medical certificate with limitations to changing the date of the consultation and the number of days the doctor recommends for the employee to be off duty. The employer will receive the medical certificate from the doctor’s rooms on the day and at the time the employee had a consultation. The system ensures that:

• Only registered practitioners and those authorised to issue medical certificates do so
• The date and time of issue (and examination) is not manipulated
• The medical certificate is only issued in the presence of the patient
• Bogus doctors don’t have access to the system.

This will help combating medical aid fraud through doctor registration verification and an electronic and paperless prescription system.

Ezra Ndwandwe works for Dual Point Consulting
2017/06/06 09:34 AM
Two hospitals owned by JSE-listed Mediclinic have been recognised as providers of quality healthcare services. This follows an assessment by the Council for Health Service Accreditation of Southern Africa (COHSASA), a body that assists a range of healthcare facilities meet and maintain quality standards and so provide safe, quality services. Mediclinic’s hospital in Morningside, Johannesburg, received accreditation for three years while the Western Cape’s Worcester Hospital was accredited for four years.

The council said that a COHSASA accreditation award indicates that the healthcare organisation was scrutinised while it underwent a rigorous quality improvement programme, which it had been assessed against and complied with according to the standards of the International Society for Quality in Healthcare (ISQua). COHSASA itself was accredited by ISQua, the global body overseeing accreditation and quality improvement programmes in healthcare organisations in 70 countries around the world, as were its standards and its surveyor training programme. Also accredited by COHSASA for quality service are the Cure Day Clinics in Bellville, Cape Town and Somerset West.

The accredited hospitals will have to undergo vigorous testing again when their accreditation ends to ensure quality standards are maintained.
2017/06/06 09:39 AM
Mediclinic has hardly been a safe-as-houses investment since muscling out rival bidder NMC to secure a £1.4bn reverse takeover of Abu Dhabi’s Al Noor in 2015, becoming Mediclinic International in the process. While Al Noor was touted as an earnings-neutral investment in the first year, it has proved a drag on profit and "gradual recovery" is now the message from management. Business Day spoke to CEO Danie Meintjes.

Was your due diligence thorough enough?

What I would have preferred – but it was not permissible and it was not possible at that time due to the circumstances — was to do a deep due diligence at operational level as well. If we knew more, would we still have done the transaction? Undoubtedly yes, but maybe at a lower price.

Margins in the Middle East are 11%, in Southern Africa 21% and in Switzerland 20%. Will they ever reach the level of your other businesses?

Two answers: we’ve told the market that in Dubai we are happy with the margins, we said there’s no reason why the Dubai business can’t get to the same margins as SA, about 20%. In Abu Dhabi, we had different circumstances, we had headwinds and you need to take into account that our tariff structures in Abu Dhabi are slightly lower than Dubai, we also do more basic patient [care] that has a much lower price point and we are doing tactical changes to get that mix of generally insured and basic insured patients to be more enhanced.

[In SA] if you start a new hospital, your start-up costs are related to your own staff – there’s no cost in terms of doctors. If you come to this part of the world, then you must recruit doctors at huge cost, bring them in, set them up with housing and pay a salary while they haven’t seen one patient yet, so that ramp-up in this part of the world takes longer than in SA.

I want to make one point very clear: we are long-term players – we’ve got a 30-year plus track record and that is what we focus on. I’m very comfortable with the potential of the Middle East.
What caused the doctor shortage at the Al Noor hospitals and how acute is it still?

To get doctors to work in the Middle East is not the issue. It is easier to get doctors to work [there] than in SA … but you have to find doctors and that takes longer. [Al Noor] lost doctors before we got involved. We don’t pay doctors to do more radiology, more pathology, to write out more scripts, etc.
That’s not our style, and we changed the remuneration model … we took a lot of staff out of the system to get our cost base right, but now we are on a solid foundation that we need to build up. What we’re telling the market is: don’t expect wonders of ramping up just because the Thiqa co-payment fell away. There are structural changes that we made.

How worried are you about regulators squeezing you on costs? What do regulators view as a reasonable margin?

I don’t think the regulator can tell you at what margin you should run your business. You must look at the capital investment and the return on capital, the risks, etc. But regulatory interference in the hospital business, is par for the course. Governments must ensure that their citizens do have access to reasonable facilities. The private sector can make quicker decisions, has access to capital and whether you do it for electricity generation or running airlines, or whatever, I believe the private sector is in a position to be more cost efficient, but then you must do a proper cost comparison with the alternatives, that is, the government. The reality is that healthcare is getting more and more expensive as a percentage of the economy.


If you think of an ageing population, you consume more healthcare in the last 10 years of your life than most of your life before that. New technology, new medicines that enhance quality of life come at a price.

But that is what is so great about this industry from an investment point of view — there are few industries where you can say the demand for your services will grow year by year. The challenge will be how to keep it sustainable.

What about capricious regulation – especially in the Middle East, where they introduced co-payments and then reduced them again?

I can only work on what I know and, yes, in the Middle East they take decisions quicker — that is the nature of that part of the world, but what is positive is that the governments of the United Arab Emirates are very pro private investors. The crown prince who announced the abolishment of [insurance co-payments] very explicitly said they didn’t want to send a negative message to private investors.

Are you still committed to SA?

We are totally committed to SA but we cannot ignore the macro environment. Political uncertainty, the lack of investment, lack of new jobs created – it’s tough and it wouldn’t be wise if you use shareholders’ money to invest if there’s no demand for your services. So we are cautious to create new capacity. 
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