A case of pure déjà vu

2017-08-01 06:00

THE latest iteration of the national health insurance (NHI) policy paper published on June 28 is pure déjà vu.

We are no closer to understanding critical details, such as how much the scheme will cost and where the money to pay for it will come from. Meanwhile, SA risks running out of taxpayers to finance its social security commitments.These were the key messages delivered at a Free Market Foundation (FMF) media briefing on July 19 by Dr Johann Serfontein, senior health-care consultant with HealthMan and Jasson Urbach, FMF director and head of the FMF’s Health Policy Unit.

The NHI scheme is based on a government-administered, centrally controlled, single-payer model. Health-care decisions will be determined by the government from the cradle to the grave. NHI will reduce the number of available services, meaning fewer health-care providers and patients will face long waiting lists.

NHI concentrates power in the hands of the government and requires it to act as both player and referee, leaving no room for the private sector. Under NHI, the government will control the availability, financing and delivery of health-care for all.

Urbach said: “Given its timing and the absence of the substantial details, we can only assume that the release of the NHI policy document is politically motivated. Critical details such as cost, funding and from where the additional personnel [both medical and administrative] will come, are absent. What is clear is that it will not materially improve the health outcomes of the poorest and most vulnerable members of society.”

The NHI policy paper states: “An NHI fund must be established through legislation. The sources of revenue for the fund will be through a combination of pre-payment taxes derived from general taxes and complemented by mandatory payroll and surcharge taxes.” The Davis Tax Committee confirms that the tax-to-GDP ratio will need to rise “quite substantially”.

However, high levels of unemployment mean that SA suffers from relatively low levels of incomes and, critically, a very narrow tax base: only 3,5 million people shoulder 99% of the total personal income tax take. There are too few taxpayers in SA to finance NHI.

NHI will mean that the 3,6% (of a total of 8,5%) of GDP spent by 16% of the population on their own health care should be redistributed to the whole population. This is unconstitutional.

Serfontein said that the minister and Department of Health consistently use factual inaccuracies to justify NHI. “It is inaccurate to say that 80% of specialists serve only 20% of the population. HPCSA registration figures show that, at most, 66% of specialists work in the private sector. It is also inaccurate to say the private sector is poaching doctors from the state. Between 2002 and 2010, there were 11 700 medical school graduates in SA. The public sector created only 4 403 posts in that same period.”

Other flaws in the NHI are:

•The costing models are unrealistic and still based on the 2010 green paper. Simply inflating these costs from 2010 to 2017 values, increases the cost in 2024 to R372 billion.

•The implementation of NHI will reduce, not increase access to services as shortfalls will not be covered by increases in taxes and the predicted low growth.

•Currently only 33% of government facilities comply with the Office of Health Standards Compliance (OHSC) standards required to contract with the NHI fund. The 30 000 to 70 000 existing private practices would require the OHSC to increase their inspection budget from R34,5 million to between R700 million and R1,4 billion.

•The NHI fund will be the single largest state-owned entity in SA and risks being as corrupt and failed as Sassa, Eskom, SABC, Compensation Fund, RAF, SAA, Sanral, PetroSA and ACSA. Failure to pay providers could collapse service delivery in the entire health system.

•Only service delivery costs are mentioned, not administration.

•A single strategic purchaser is not justifiable. If the NHI fund is going to set prices, it does not need monopsony buying power to reduce them.

•Medical schemes will only be allowed to cover services not in the NHI basket but there is no clarity.

•Medical scheme options will be reduced and tax credits scrapped. Members will also have to pay full price for the state system charged at current income tax threshold levels.

The government’s role should be to finance health-care for the poor and leave the private market alone to provide for those able to fund their own health-care. This will allow the government to concentrate scarce taxpayer resources on the truly destitute, while allowing the private sector to innovate and expand.

In order to fulfil this task of acting as financier, the government can and should enlist the support and help of the private sector by contracting out those services that can be provided more efficiently by private providers and administrators.

In the same way as people have many options to choose from in household insurance, car insurance etc, publicly funded patients will then have a multiplicity of medical schemes to choose from.

Competition between public and private hospitals and clinics to win business from taxpayer-funded public health insurance beneficiaries will ensure the best service for the best price.

Join the conversation!

24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.
NEXT ON NEWS24X

Inside News24

 
Watch: Investing in the future through child development

An investment of R32-million into 11 early childhood development centres is changing the future for children in the Northern Cape.

Partner Content
What all investors should know about index investing

Index-linked investments are growing fast in popularity globally, and are growing in size and complexity too.

/World
 

Makeover saves dog’s life

Lucky Charlie got a complete make-over that helped him get adopted.

 
 

Paws

For the love of Corgis!
Can we communicate with our pets?
8 great natural remedies for your pet
Buying a puppy? Don’t get scammed!
Traffic Alerts
Traffic
There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.




Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.