Health system failures will persist until HMI recommendations implemented – CompCom

Characteristics contributing to South African health system failures, such as information asymmetry between patients and practitioners, the general absence of value-based purchasing, and failures of accountability at many levels will persist until the interrelated set of recommendations in the Health Market Inquiry (HMI) report are implemented.

Issuing this warning during a recent GEMS Symposium – theme for which was “Value co-creation for a patient-centric health system” –?Mapato Ramokgopa (pictured), Competition Commission Divisional Manager, Market Conduct, reminded her hybrid audience that patients, as consumers, have little to no countervailing power when seeking treatment,?and are unable to negotiate prices.

A related systemic problem revolves around the third party payer where price/cost sensitivity is muted because the client, or patient, is not paying directly.

“We all know that the health system is being characterized by high costs and increasing expenditure, and there is excessive utilization without any corresponding measure of improved health outcomes,” said Ramokgopa, noting that one of the HMI findings was a market power imbalance impacting on fair contracting and risk sharing initiatives.

Of particular concern from these findings, she said, was a lack of a defined health pathway resulting in inappropriate levels of care largely at secondary and tertiary levels. “totally ignoring the primary care level”.

Added to this was the problem of product complexity with 73 schemes offering about 170 incomparable benefit options: “There’s also hospital insurance, gap cover – these products just totally disempower the consumer!”

Regulatory gap contributing to the system failures, Ramokgopa stressed, was the ongoing lack of a price determination framework. Topping the list of concerns here was still the oversubscription of fee for service (FFS) and the lack of proper risk-sharing reimbursement models. All this had resulted in a lack of price certainty and “significant out-of-pocket (OOP) expenses for patients”.

Also wanting was a health data sharing framework incorporating outcomes monitoring. On this, she noted, funders have access to transaction/claims data from all providers while providers have clinical and claims information: “But only for themselves! This disincentivises fair negotiations and the uptake of risk transfer arrangements.”

Concluding, Ramokgopa reiterated: “The HMI made a set of interrelated recommendations that to date have not been implemented, so these failures will persist.

“It is difficult to foresee a seamless transition towards the NHI without addressing these challenges.”