Is NHI the straw that will break Treasury’s back?

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Given the scale of state capture and mass looting at enterprises like Eskom, South Africans are right to suspect another boondoggle on its way now that the National Health Insurance (NHI) Bill has been approved by the Parliamentary Portfolio Committee.

If Eskom is losing R1 billion a month to corruption and graft, as former CEO Andre de Ruyter estimates, this likely pales alongside the opportunities for enrichment coded into the NHI Bill.

“If this bill is implemented, we will see a massive drain of medical expertise from the country,” says Michéle Clarke, Democratic Alliance (DA) spokesperson for health.

“We see this as an electioneering stunt by the ANC. Even their own finance minister has told us they cannot afford this. I suspect once the 2024 election is over, you won’t hear much about the NHI anymore.”

Trade union Solidarity and the DA are among those who have threatened to challenge the NHI in the courts.

Disregard for expert opinion
The South African Medical Association (Sama) says the NHI Bill was developed with disregard to the legitimate concerns and recommendations of experts, and that “trust in the government’s capability to manage the over R500 billion budget efficiently is severely eroded, in particular given inter alia the mismanagement of Covid-19 funds.

“Misappropriation of funds in various state-owned entities casts doubt on government’s ability to handle the healthcare budget responsibly. The public, alongside healthcare stakeholders cannot simply entrust their lives to a government with an established history of financial mismanagement.”

There is some evidence that the ANC government knows the NHI is a non-starter. The first clue was the lack of any mention of the NHI by Finance Minister Enoch Godongwana in his latest budget. Outgoing Health Ombud Professor Malegapuru Makgoba recently said the healthcare system was not working and could not be fixed by the ANC government which, he said, was “so incompetent that we should do something about it as the electorate.”

No feasibility study
Opposition parties and health bodies say a feasibility study on the impact of the NHI, particularly in the post-Covid-19 environment, is lacking.

Health Minister Joe Phaahla, in his 2023 departmental budget vote, said government was committed to reducing inequality in the current health system, and to “the progressive realisation of Section 27 of our Constitution”, which affirms equality of rights to healthcare and other services.

The Department of Health says it is recruiting experts in specialisations like digital information, healthcare benefits, risk and fraud management and data analytics, which demonstrates some intent to proceed with the implementation of the bill.

The NHI was ridiculed as one of the most irrational schemes yet concocted by government when it was first introduced in 2018. It remains bitterly contested now that it has been approved by the Parliamentary Portfolio Committee for Health five years later – the main question being how it would be funded, given an already distended national budget.

Bill to be challenged
The Hospital Association of South Africa (Hasa) says while there is broad support for universal access to quality healthcare, “we believe that approving the bill without substantive consideration of the many valid and significant recommendations and contributions made by many participants during the Parliamentary hearing is deeply regrettable and a missed opportunity by the committee.”

Solidarity says it will take the government and the Department of Health to court if the NHI Bill is accepted as final.

“Implementing the NHI will undoubtedly result in a disaster in the medical industry,” says Peirru Marx, network coordinator of the medical industry at Solidarity.
“The government is simply not to be trusted. Their history of abuse of power, mismanagement and corruption will undoubtedly compromise the quality of medical care.

“We are also worried about the number of healthcare practitioners who have indicated that they will not work in these circumstances. There is also prevailing concern about the complete collapse of the free market in this sector as a result of the NHI.”

Single-payer model criticised
Sama says it supports “well-developed healthcare benefits for the whole population”, but says the bill gives the health minister too much power. Several organisations have pointed out that it’s difficult to properly critique a bill when the associated regulations, which will contain much of the important detail, have yet to be published.

A major criticism of the bill is that it would impose a single-payer model in which government is the only buyer of healthcare services for its citizens, according to Business Leadership South Africa CEO Busi Mavuso.

Rather than relegating the private sector to the margins, incentives should be put in place to encourage private sector participation and alleviate the burden on government.
The Department of Health makes the point that a tiny section of the population has access to healthcare, and intervention is needed to prevent private healthcare providers charging “exorbitant fees”.

Under the proposed NHI, private ambulance operators and hospitals will no longer be able to offload patients because they are poor or their medical funds have run out.

Imbalanced health system
While eight out of 10 patients depend on public clinics and hospitals, the bulk of the country’s doctors, dentists and specialists serve a small section of the population who can afford private healthcare, according to the Department of Health.

The NHI proposes a government-funded health insurance for all South Africans, with funds paid into an NHI fund from taxes and employee contributions for the most part. Those currently paying into medical aids will be free to continue doing so, but will not be able to opt out of making contributions to the NHI Fund.

Government will no longer provide tax incentives for medical scheme contributions.

The NHI will offer South Africans and legal residents a defined package of health services, but will not cover expensive elective procedures such as cosmetic surgery or expensive dental work.

The South African Private Practice Forum (SAPPF), representing private medical practitioners, is another industry body that has rejected the NHI Bill (though it supports universal access to quality healthcare), in particular the fact that it limits medical schemes’ capacity to fund healthcare and undermines the collaboration between the public and private sectors.

The NHI faces a mountain of logistical issues. Registering South Africans online will be the first obstacle to overcome. In a critique of the NHI, the DA points out that millions of South Africans do not have access to electricity and water, let alone the internet.

Underfunded hospitals
Hospitals are already under-funded, with a critical skills shortage of 27 000 personnel and the NHI will exacerbate rather than fix these problems, says the DA. The NHI will drive out medical professionals, while the pooling of funds will make the NHI vulnerable to theft and corruption.

“We urge the National Assembly and the National Council of Provinces in their deliberations on the bill to insist on a multi-payer model to mitigate against the concentration of risk, an iterative rollout based on milestones rather than dates and to pay heed to the nation’s concerns that the proposed National Health Insurance Fund is susceptible to theft and corruption by proposing and approving alternate and appropriate governance structures.

“The healthcare reform decisions taken now will impact the sustainability of South Africa’s health system and will be deeply felt for generations to come,” says Hasa.

The Citizen/ Ciaran Ryan