The private hospital sector stands ready to work with government: HASA

By Helmo Preuss

Speaking at the Hospital Association of South Africa Conference in Sandton, Netcare Chief Executive Office Dr Richard Friedland said that private hospitals wish to work with government to find solutions to South Africa’s healthcare problems.

He proposed mandatory medical cover for the formally employed as a potential solution that has been well-researched over two decades and is a “workable solution that if implemented will be quick to roll out and in a very short time provide enhanced healthcare to all South Africans.”

The proposed National Health Insurance (NHI) stems from the ruling African National Congress (ANC) December 2007 Polokwane national conference and is largely ideological driven without regard to the practical implications of creating a universal health care (UHC) system so as to ensure that all South Africans have access to affordable, quality healthcare services regardless of their socio-economic status.

The Green Paper on the NHI released by the South African government in August 2011 set the parameters of the debate and after 39 iterations and 60,000 submissions spanning four years the resultant White Paper in December 2015 failed to address the issues raised by the public consultation.

The signing of the NHI Bill into law on the 15th May 2024 by President Cyril Ramaphosa was a key milestone in the journey towards universal and comprehensive quality health coverage for all, but has been opposed by many as being financially unaffordable while there are not doctors and nurses to implement the NHI.

The NHI will be implemented in two phases according to the Department of Health. We are now in Phase one and will continue for a period of three years until 2026. Phase Two will commence in 2026 and will run for a period of another three years until 2028.

The current national health system has a myriad of challenges, among these being the worsening burden of disease due to people living longer and being more sedentary resulting in a rise in non-communicable diseases (NCDs) such as cardiovascular diseases, diabetes, chronic respiratory conditions, and cancer, as well as the scourge of AIDS and tuberculosis, high maternal and child mortality together with high levels of violence and injuries.

“Mandatory health cover of formally employed is tried and tested and if put to use in South Africa could reduce the public health burden, increase public per capita spend on health, and free up resources that could help address the country’s most pressing health crises,” Friedland said.

Friedland pointed out that the African National Congress’ 1994 Health Plan recommended mandatory cover for the formally employed and the National Department of Health Social Health Insurance Working Group in 1997 recommended that mandatory cover for formal sector employees should be confined to those above the income tax threshold, due to affordability concerns.

“With a formally employed population of 11.5 million, together with the estimated number of dependents, based on a 2.4 beneficiary ratio, this could result in up to 27.5 million of our population that could potentially over time become covered, leaving the remaining 35.5 (56% of the population) people dependent on public health resources,” Friedland said.

Government public health per capita spend, he said, could increase over time by 52% without any additional funding of the public sector budget.

“In simple terms, if one considered the entire population in South Africa, government’s responsibility would reduce from the current 85% of the population covered by public health to 56%,” he said.

The latest per capita public expenditure based on a consolidated health budget of R271 billion works out to R5 054, when considering the population and excluding medical scheme users. With formal employment coverage, that per capita public expenditure on public health users would increase 52% to R7 659.

The HASA proposal would be implemented in three phases.

Phase one would involve including the formally employed and their dependents who are above the tax threshold. This would grow the medical scheme coverage from 9,2 to 15,4 million.

Phase two would include those formally employed and dependents who are below the tax threshold. This would push medical scheme coverage to 27,5 million and expand public per capita spend to 52%.

Phase three will allow for the expansion of the economy through recovery and an increase in employment.