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National Health Insurance proposal a disaster for healthcare says leading economist

05 June 2009

In Categories: Industry News , Industry News > General

HOSPITAL ASSOCIATION OF SA

National Health Insurance proposal a disaster for healthcare says leading economist

Friday, 5 June: Health economist Alex van den Heever has dismissed a proposal paper outlining a new National Health Insurance (NHI) system as a “completely unworkable, unaffordable solution that won’t improve health services despite massive increases in expenditure.”
Speaking at the Hospital Association of SA (Hasa) conference in Durban, van den Heever said there had not been any public discussion or proper debate around a proposal which has been put together by an ANC task team driven by Olive Shisana.

The document, which has been kept confidential, proposes setting up a National Health Insurance Authority (NHIA) within a year that will oversee healthcare in both the private and public sector.  The paper also proposes increasing the health budget by R100bn and introducing an earmarked tax to all employed South Africans to create universal access to healthcare.  People would not be able to opt out of the system and costs would be shared between employers and employees.

“The danger is that there seems to be an attempt to avoid debate on this issue,” said van den Heever. “The documents have been produced, but have not been subjected to external peer review or technical analysis.”
Van den Heever said the proposal envisages a “big bang” approach to implementing NHI rather than a phased in approach.  It would shift all South Africans into a unified healthcare system. Under the proposal, medical scheme members would pay 85% of their contributions, irrespective of the option they were on, to a global fund which would pay both public and private sector providers.  Non-medical scheme members would have to pay 5% of their income to the fund. Medical schemes would only be able to cover benefits that were not covered by the NHI.  “In other words, you would not be able to buy cover in the private sector for cancer treatment, if cancer was covered in the public sector,” said van den Heever.

The document is still at task team level, and will then be escalated to the National Executive Committee for drafting into legislation.

 Scathing in his attack, van den Heever said the legislation was being driven by private interests and “implies huge institutional changes that have not been rationally motivated or subjected to sufficient scrutiny.” He said the proposed system would duplicate the current public system.
“The problem with our health system is clearly not only about how much, but rather how well the public funds are spent,” he said.

Van den Heever said the proposal focused on describing the institution of the NHIA, rather than practically demonstrating how it will solve the main problems in the health system.  “The assumption is that you just need to create this institution and everything will fall into place.”
Van den Heever said the proposal makes GPs front-end service providers and all doctors would have to move into accredited group practices.

“Despite the fact that the committee accepts that South African doctors may leave the country if it introduces its proposals, its response has been that doctors will be imported from Cuba and the Philippines,” he said.
The proposed NHI system would also require all South Africans to be registered on a national register and would need to be issued with an identity card. 

Van den Heever said this will create a massive bureaucracy and would need to be kept updated and be made fraud proof. The proposals would also see provinces operating as medical schemes and provincial authorities would have to process claims for providers and suggests this could be achieved within 60 days. 

“The proposed changes would introduce a complexity into the health system that would outweigh any benefits,” he said. “Far from reducing costs, it is more likely to increase them significantly.”
 In response to the proposals, CEO of HASA, Kurt Worrall-Clare said that in a constitutional democracy such an important transition required comprehensive debate and public participation.

“Private sector hospitals do not see ourselves in opposition to NHI, we have been saying for the past few years that we are willing to help with practical solutions to improve access,” he said.  “But any solution must include improving hospitals in the public sector.”
President of the South African Medical Association (SAMA), Professor Ralph Kirsch said there had tended to be a resistance by government to utilising private sector expertise, but that doctors had reaffirmed their endorsement of universal access. “However, there need to be changes in the public sector at the level of governance, delivery and funding,” he said.

 Speaking at the conference the previous day, Deputy Minister of Health Dr Molefi Sefularo said the Department of Health would release papers outlining its NHI plans by the end of June and would then consult with stakeholders including the private sector before releasing a White Paper on the NHI.
“We have noted the concerns of the private sector about the prolonged silence [from the Department of Health] on NHI and lack of certainty about what is contained in our plans,” he said.  “It will not be sprung on you by surprise. There will be ample opportunity for debate and contribution.”
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