BHF360° | DECEMBER 2020
HE A LT H S Y S T E M S S T R E N G T H E NING
CAPITATION IN THE SOUTH AFRICAN CONTEXT Current obstacles and a way forward C JOINT CEO,
INSIGHT ACTUARIES
& CONSULTANTS
“
apitation is an underutilised form of reimbursement in South Africa. True capitation would mean a provider, or provider group, takes a per capita fee for a specified population in return for a monthly fee. In South Africa, public sector budget allocations come closest to capitation in that resources are divided between the provinces on a per capita basis, but from there funds
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By Barry Childs
Re-empowering the primary care practitioner through progressive benefit design changes
lays a foundation for reimbursement reform through capitation.
are allocated according to local health priorities on a grant or budget basis. In the private sector there are numerous examples of intermediated capitation where a managed care organisation or provider group takes risk on a per capita basis, but in most cases individual providers are still paid via fee for service.
Capitation brings some benefit to providers in the form of more predictable income and an ability to better manage the health of a pool of patients, rather than just treat patients on demand. Our system is, however, not well structured to allow capitation models to develop at scale. Medical scheme options with savings accounts or with limited out-of-hospital benefits cannot support capitation for primary care benefits. The current prescribed minimum benefit (PMB) review process is focused on a primary healthcare package of benefits, and while there is as yet no clarity on how this will affect the current PMBs, such a package would no doubt have some influence on future medical scheme out-ofhospital benefit designs. One fundamental flaw in the South African private health system is the generally laissez faire approach to primary care. Schemes permit members to access care at their level of choice rather than follow defined pathways of referral. This approach
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