How pricy is private health?

2012-08-25 16:54

The health department says private healthcare in South Africa costs much more than elsewhere, but hospital groups refute this.

Some of South Africa’s biggest hospital groups have hit back at the health department, disputing claims that private healthcare here costs five times more than in several developed countries.

The startling information about prices was revealed by the department’s deputy director-general for regulation and compliance, Dr Anban Pillay, at a recent Board of Healthcare Funders conference.

Pillay based his comments on a study conducted by the Organisation for Economic Cooperation and Development (OECD) on the cost of treatment in hospitals in developed countries.

The OECD is an organisation of mostly developed countries that aims to promote policies to improve global economic and social wellbeing.

Drawing on the research, Pillay compared the cost of several medical procedures in countries like Canada, Germany, Australia and South Korea to the cost of the same procedures here.

But hospital groups have accused Pillay of comparing apples with pears and using flawed methodology.

Netcare’s director of strategy and health policy Melanie Da Costa said: “Pillay somehow drew a different conclusion based on adjustments to the data, the logic of which neither our team of policy experts nor economic advisers locally and offshore understand.”

Mediclinic echoed its rival’s sentiments.

Roly Buys, the funder relations executive at Mediclinic, told City Press: “Mediclinic’s calculations indicate that the analysis that informed this conclusion is incorrect.”

Pillay used six procedures – pneumonia treatment, normal and caesarean birth and heart-related conditions – to illustrate just how dearly South Africans were paying for private healthcare.

He showed that the cost of a natural childbirth at a local private hospital was about R21 600, while Germany charges R14 400 and Sweden R20 800.

Hospital groups have disputed these figures this week, but they refuse to reveal their prices, saying the Competition Act prohibits them from doing so.

Pillay refused to comment about his presentation this week. He referred all questions to the department.

Health Minister Aaron Motsoaledi defended Pillay, saying: “Pillay did not fabricate those figures – all he did was to share what the OECD study found.

“This perception that we are liars when we say private health costs are exorbitant in South Africa is unfounded. The private healthcare sector must tell us what their prices are and how they arrive at them.”

The Hospital Association of South Africa, which represents the country’s major hospital groups – Netcare, Mediclinic, Life Healthcare and National Health Network – have requested a meeting with the department to discuss Pillay’s claims.

Mediclinic’s Buys said: “Pillay must explain how he arrived at his figures. We conducted a comparative analysis for certain procedures based on Pillay’s presentation and can clearly illustrate the error in his conversion to show comparative prices on the basis of purchasing-power parity.

“Our calculations for a caesarean section, for example, indicate that local private hospital prices compare more favourably with the OECD average and are lower,” he said.

Motsoaledi said hospital groups were more than welcome to engage with his department on the issue.


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