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Is National Health Insurance a national disaster?
Medical scheme Profmed recently hosted a webinar in which it tackled the issue of the impending National Health Insurance (NHI), which poses massive implications for the future of healthcare in South Africa.
“Healthcare access is a problem and we need a partnership approach between private and public sector healthcare to work in unison to remove the inefficiencies in the current system for the good of all South Africans,” Profmed CEO Craig Comrie told the webinar.
The question remains, how can all the various stakeholders be pulled together to deliver better healthcare for all South Africans? Comrie indicated that the NHI program must provide space and not threaten the role of medical schemes as depicted in a single payer model policy. This would create a number of constitutional challenges that would delay essential healthcare reforms that could benefit individuals who belong to medical schemes and those that do not.
NHI versus medical schemes
\In Comrie’s opening presentation, he stated that successful national health systems across the world have always been supported by private healthcare insurance. “Around 15% of South African citizens are covered by medical schemes, so we see that there is R220bn spent in the private sector of which most is spent by medical schemes to provide healthcare to those who pay for insurance.”
Regarding the short-term future of schemes within the NHI, he believes the NHI will only be able to cover a small range of primary healthcare benefits in its infancy – which provides space for schemes to continue to provide a service. “This is provided for in the NHI Bill and the so called ‘complementary’ role that medical schemes will play will remain the dominant role until additional budgets are found within the fiscus to broaden what is covered by the NHI. This budgetary gap, not out of design but due to economic pressures and low tax collections, will effectively ensure that medical schemes are still going to play a critical role for the foreseeable future. Any consideration of increasing the tax burden for this concentrated group of taxpayers, specifically to fund NHI, is completely unrealistic. These taxpayers are dominantly professionals who have vast global opportunities and contribute significantly to employment in South Africa. We can ill afford to lose them.”
Medical practitioners – Are we heading for a brain drain?
The next major challenge South Africa faces is the narrowing healthcare resources such as doctors and specialists who are migrating to developed countries. Comrie said that a key asset within the healthcare sector is the healthcare professionals who are fundamental to the success of any reforms within the healthcare system, illustrating that just from Profmed’s own membership, which covers around 60% of healthcare professionals, South Africa is losing around 260 doctors a year. “This number is not the full picture if you consider doctors with other medical schemes and those that are retiring. From a Profmed perspective, the number one reason for people leaving our scheme over the past five years is emigration. An essential part missing from the current NHI Bill is a plan to retain and produce more doctors and specialists; without this NHI is dead in the water.”
When asked how Profmed proposes to solve this issue, Comrie responded by highlighting the need to provide the security of income, giving doctors an indication that they aren’t going to lose their independence in an NHI scenario that seems to nationalise their futures and narrows their choices of where in the healthcare value chain they prefer working. Comrie said how the NHI secures services in a way that provides healthcare professionals with an income and suitable job security, should be solidified. “A careful change management process is one of the missing rungs in how we develop the overall NHI process.”
A desperate need for both public and private provision
Dr Nicholas Crisp, now the Acting Director General at the Department of Health, described the NHI as a financing system at its core. He believes the single-payer model is the only way to roll out the NHI and this is why medical schemes, as funders, are more concerned about it than the providers themselves. However, this shouldn’t detract from the fact that South Africa desperately needs the NHI.
With just over R250bn dedicated to public healthcare, Dr Crisp noted that these funds will be the first port of call and bring the private contributions of R220bn into one space to create efficiencies in purchasing healthcare services. “There is a long way to go and initially this may be threatening to provincial governments as it represents one third of their budgets that are allocated for healthcare. The bulk of these funds will also need to be centralised under the NHI.”
He noted that the same kind of pain would occur in the private sector. “Instead of making voluntary contributions to our medical aids, we need to raise this money as tax. If I pay R5 000 a month to a medical scheme, I should then rather pay it to the NHI, unless I want to cover something that is not covered by the NHI for which I can seek medical scheme cover.”
To allay concerns, Dr Crisp provided reassurance that this would be an incremental process. He said the NHI development processes will start to become operational at the end of this year, but that didn’t mean everything would change next year. “Small things will start to change. Systems will come online. Patient records will start coming right and Covid’s Electronic Vaccine Data System already provides a database of possible future NHI participants. NHI will only happen once there is an Act to establish it.”
Dr Crisp ended his address to the webinar by stating, “When my health matters to you as much as your health matters to me, then we will have equity. We need this as citizens, so that everyone can get proper healthcare. I believe that we have the resources.”
Understanding the role of medical aids in funding
General Manager at the Health Funding Association of South Africa, Daisy Seakgoe, said in her address that the restrictions of medical schemes to provide complementary cover in a future NHI is tenuous.
“There is a great opportunity to apply the Health Market Inquiry recommendations to improve the way that medical schemes function as part of a coordinated health system. This will create a more integrated medical scheme system capable of supporting the NHI fund and will support access to quality healthcare for all South Africans,” she said. She added that there is a widespread misunderstanding that private medical scheme contributions will automatically be rerouted to the NHI fund. “This is not the case as medical scheme contributions are private expenditure. A key concern is that medical scheme beneficiaries will now be drawing on state resources, adding to the State’s burden, and that this has not been properly interrogated yet and shouldn’t be assumed.” Foundation before funding Chairperson of the South African Medical Association (SAMA), Dr Angelique Coetzee, told the webinar she doubted that the NHI could be initiated in 2026 as the challenges are too vast.
She listed these challenges as:
• Quality failings in delivery and infrastructure
• Shortage in human resources and misdistribution of these resources
• Acute shortages of management skills
• Poor access to healthcare
• Provinces failing to address their own challenges.
“We do not know how these issues will be addressed in the run-up to the implementation of the NHI. That is going to be an issue,” Dr Coetzee said.
She listed the challenges that are posed by the private healthcare sector, which include:
• Widespread failures in regulation
• Expensive and financial risk exposure to users
• Quality is essentially unmeasured
• Fraud, waste and abuse
• Fragmented delivery, funding and clinical governance.
“We are talking about funds, but how can you discuss funding when you don’t know what you are going to fund. We know its primary healthcare, but will the money be enough to address all the challenges I mentioned?”
Dr Coetzee suggested that the regulations first be examined, and then the available funds. “Yes, we need a funding model, but we need to get the numbers right first. If we don’t fix the foundation of the home we want to build here, we are not going to get anywhere. Not in this lifetime.”
Craig Comrie, CEO, Profmed
