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Mediclinic News : Act on costly private care

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Act on costly private care

Date

2017-04-27

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FINANCIAL MAIL Government continues to ignore much needed policy reform on private health care, adding strain to medical aids More than 50% of medical aid options in 2015 ran at a loss — spending more money on sick members than they earned in premiums. Running out of money is a symptom of a floundering private health system. Experts concede this fact. But can it be fixed? There is consensus that it would take political will to create new laws as part of the solution to healing the costly private healthcare system in SA. But if statements by government health leaders, such as "medical aids are a crime against humanity" are anything to go by, the state's commitment to finding a solution is lacking. What is wrong, and why is the middle class spending so much money on health? "If you build it, he will come", is a line from the 1989 movie Field of Dreams. It correctly describes SA's private hospital industry. The more private hospital beds there are, the more people get sent to these hospitals, and the more money medical aids pay. Discovery Health CEO Jonathan Broomberg says: "The fact that healthcare providers are able to create demand for services is so well recognised globally that it is no longer controversial. This occurs in any market where suppliers have more information than consumers." Discovery Health medical scheme says its data shows an increase in newly built private hospitals in Durban increased the number of people going to these hospitals. Hospital groups in SA dispute this. Only doctors, who by law are not employed by hospitals, are permitted to admit patients so the hospital owners can't fill their beds artificially. Broomberg says: "Our data demonstrates that opening up new hospital beds in a region leads to increased rates of hospitalisation, which cannot be explained on any other basis such as changes in medical aid membership." It is a little more complicated than the mere presence of beds. "The private healthcare system is much worse than you think it is," said Brian Ruff, who left Discovery Health to start the PPO Serve company, in order to fix a system that he feels is flawed. SA doctors are well trained and you get good speedy treatment if you have a single case," says Ruff. "What trips up the system is a patient with multiple disorders and multiple doctors who don't communicate with each other about treatments and medications." Administrative, economic and legal systems are also leading to overtreatment, which ultimately affects ordinary people's wallets. Too much is spent on health care so medical aids are becoming unaffordable, with premiums rising above inflation each year and few young people able to join medical aid schemes. Premiums rose between 10% and 14% last year, on the back of many years of increases. One of the reasons is that more people are using health care and staying in hospital longer, as the Government Employee Medical Aid Scheme and Discovery Health data on more than 4m medical aid members shows. Both medical schemes noted a spike in use and unexpected spend of their budgets in the middle of last year. Ruff says: "The problem with America's health system is price. SA's problem is over utilisation." What it means: Amendment in legislation is needed to make private healthcare affordable to all What Ruff means is that people use too much private healthcare. If something can be done out of hospital, it is done in hospital at 10 times the cost, he says. This is often because that is the only way a medical aid will pay for it. Medical aid benefits, legislated and not revised every two years as legally required, by law have to pay for hospital treatment rather than treatment at a GP or clinic. Middleclass South Africans are spoilt and are also used to seeing specialists for minor issues that their GP would manage well and cheaper. In Australia, by law, specialists can only be accessed by referrals from general practitioners. SA has the dubious honour of having the highest rate of caesarean section births in the world. 70% of all women on a medical aid, according to the Council for Medical Schemes data, don't give birth naturally. The reasons are not only that local women are just used to being "too posh to push" and gynaecologists want to play golf on a Friday afternoon, as critics often suggest. The reason for this global anomaly is a broken system, says Ruff. Private medical aids or individuals pay doctors for working alone. Gynaecologists, on their own, cannot deliver too many babies naturally, says Ruff. A single natural birth could take longer than 12 hours. If a referral to a midwife will cause a gynaecologist to lose income, why would a doctor do it? Medical aids pay them individually. Doctors have to be paid in teams. Paying people to work in teams, which could change the overreliance on specialists and hospitalisation, means there is a need for changes in SA law. SA law halts progress Broomberg agrees. "In our [Discovery Health's] view, many SA regulations governing health professionals are out of tune with progressive developments in global healthcare systems. Most modern systems are realising that encouraging teamwork among health professionals is the key to improving the quality of care and reducing cost. Our current regulations hamper such teamwork," he says. The Health Professions Council of SA released a press statement reminding doctors that accepting socalled global fees could be unethical and illegal. Government has over the past 10 years done nothing to fix laws to ensure the private sector runs well. Ruff says: "There are no policy aims for the private sector despite its size, spending and importance, except for a wish that it will somehow disappear. We are in a policy 'black hole', probably as a consequence of the NHI process... and that's disastrous because it won't disappear. Because government is antagonistic towards private health care, there are no policy aims. It is astonishing that a sector in which R180bnR200bn will be spent this year has a policy vacuum." He is not alone. In their initial suggestions to the competition commission's market inquiry into private health care, hospital groups, doctors, industry experts and medical aids complained about the outdated regulation. Mediclinic's Roly Buys says the laws to effect all these desired changes will take time to put in place. If the past 10 years is anything to go by, the health department is not showing any desire to reform this system. "If he had his way — the private sector wouldn't exist," says a doctor and friend of health minister Aaron Motsoaledi. Well, ignoring the sector won't make it go away, but it will make it more expensive.
Created at 2017/05/03 04:50 PM by Mediclinic
Last modified at 2017/05/03 04:50 PM by Mediclinic