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Mediclinic News : NHI: Cure for ailing system

Title

NHI: Cure for ailing system

Date

2016-09-01

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News Description

FINANCIAL MAIL SA has some of the best private healthcare in the world but not for the public. Data published by the SA Institute of Race Relations recently shows that since 1994, spending by the state on public healthcare increased to more than what households were prepared to dish out on private medical cover. And even though the combined national and provincial expenditure accounts for almost 12% of total government spending and SA's per capita expenditure of US$1,148 is comparable to that of other developing nations like Brazil and Turkey, the fact that the majority of South Africans are not covered by a medical aid has the system buckling under the pressure. And it is only going to get worse. "SA's healthcare system is not merely unviable or unsustainable, it is at the brink of collapse, if the government does not intervene," Board of Healthcare Funders MD Humphrey Zokufa told the media at a briefing in June. Furthermore, South Africans will increasingly have to rely on the state in future as the rapid increase in the cost of members' medical scheme contributions, to cater for the ever soaring rates charged by private healthcare providers, is becoming unaffordable to many. Currently, only 17.4% of the population is medically insured. The affordability issue in turn, industry players say, will impact on the sustainability of private for profit providers. The Council for Medical Schemes (CMS), regulator of the medical schemes industry, revealed in its annual report for 2014/15, which was released in September last year, that the downward trend in the total number of medical schemes in operation continued in 2014. On December 31 2014, there were 83 registered medical schemes, and CMS data showed that scheme contributions increased by 8% to R140.2bn. Total gross relevant healthcare expenditure incurred by schemes increased by 10% to R124.3bn. The above inflation rising cost of private health care took centre stage at the health market inquiry by competition authorities earlier this year. The inquiry panel, chaired by former Constitutional Justice Sandile Ngcobo, was launched following concerns about the sector, including pricing and a lack of transparency. The investigation into the private healthcare sector began in 2014 and the hearings were the last part of the process. Submissions on the shortcomings of the current system and future challenges were made by various parties, including the WHO, OECD, the Health Professions Council of SA and organized labour. Business Day quoted Health Minister Aaron Motsoaledi from the side-lines of the inquiry stating that the department's main aim was for the healthcare system to be fair. He said healthcare prices were "exorbitant" and that needed to change. Some of the issues being put forward to the commission were symptoms of a bigger problem and the root cause is what needed to be solved, Motsoaledi said. Over the years, government has argued that the experience of SA clearly demonstrates that the private for-profit health sector serves a minority elite, and that substantial general tax resources support these privileges, creating a huge mismatch between resources available and citizens served. More importantly, the private for profit health sector limits the ability to achieve the income and risk cross-subsidies required to achieve a universal health system, which the World Health Organisation has called on all member states to pursue. At the June media briefing Motsoaledi, together with the BHF, concurred that the pooling of resources for a national health insurance is the only way to lower cost and increase universal access. Motsoaledi also addressed some of the concerns raised around the NHI. He said the implementation of the NHI is by no means an attempt to destroy the private healthcare sector. "It comes down to this simple dichotomy: SA has some of the best private healthcare in the world with some of the best resources available, but these resources are not available to the public. People must please ignore scare tactics, it draws attention away from the good that the NHI can do," he said. He was also quick to point out the costs of the NHI were currently inherent in the system. "We are often told that we are attacking the middle class through the implementation of the NHL. But the middle class is being squeezed now," he said. "These costs, and the rules being enforced by medical schemes, are forcing more people to turn towards public healthcare, which we all know is under pressure and stretched to the limit. "A key element in the NHI will be the pooling of funds which will give government a significant bargaining chip when it comes to rolling out quality medical care for all citizens." Meanwhile, following several appeals by the Minister of Health for the industry to come up with innovative ways of providing affordable medical benefits to the masses, the CMS developed a proposal to introduce low cost benefit options to people who can otherwise not afford medical scheme coverage. The CMS explains that the proposal received widespread support from government and industry. It provided for a framework and detailed guidelines on low cost benefit options and for exemptions to be granted from compliance with certain sections of the Medical Schemes Act. "The Council has approved the framework, allowing medical schemes to apply for registration of such options upon publication of the framework," stated Daniel Lehutjo, Acting Chief Executive Officer and Registrar of the CMS.
Created at 2016/09/07 11:00 AM by Mediclinic
Last modified at 2016/09/07 11:00 AM by Mediclinic