Union outraged by NHI study

2010-02-16 15:10

THE National Education, Health and Allied Workers’ Union (Nehawu)

today slammed the research by consultancy firm Econex into the proposed National

Health Insurance (NHI) scheme.

The research was “yet another guesstimate exercise” purporting to

be a credible study on the costs of the NHI, the union said in a


Nehawu said the research had been commissioned by private hospitals

– “hardly a reassuring indication of objectivity”.

“Wild and unfounded claims on the supposed costs of the NHI are

made in the report, including the usual claims about the possible tax

implications, a ploy intended to scare off the taxpayers for ulterior motives of

those who currently take the largest share of our country’s health budget to

service their selfish interests as opposed to improving health care to a large

majority of our people.”

According to Econex study, the government will have to provide an

extra R244?billion a year, in addition to the money it already spends on


“The proposed NHI in its current form, promising universal

coverage, no co-payments, comprehensive cover and provider of choice, will be

massively expensive,” Econex said in its research note.

However, the union said Econex economist Marine Erasmus had

allegedly confirmed in a radio interview that the estimate of an extra

R244?billion a year was based on only two leaked documents and one public

document from ANC Today, the governing party’s official newsletter.

“She (Erasmus) has in the same interview confessed that she has

absolutely no idea of what the detail is. However, the report acknowledges that

the researchers based their costing of the comprehensive cover on the current

private healthcare costs believing that there would be a greater shift towards

the use of private healthcare,” ANC Today reported.

Nehawu said it rejected this assumption as private healthcare was

not available to people living in remote areas “and in any case the NHI is not

going to be based on the current private health costs which are distorted by

profiteering and inefficiencies”.

The union said Econex had indicated the additional revenue needed

for the NHI would amount to a 33% to 37% increase on total tax revenues.

“However, in (the) interview, Erasmus stated that it would be

difficult to say how much additional income tax would be required given the

little detail we have at the moment,” the union said.

Nehawu further rejected Econex’s suggestion that social health

insurance, where only employed people would be covered, might be the best option

as an interim step towards a full NHI, adding that the idea would once again

“remove the focus of health delivery from workers and the poor”.

And this was

not in line with the constitutional injunction which expected government to

ensure access to healthcare to all.

“Distortions and misrepresentations about a people’s health are not

only unethical and irresponsible but they are also a health hazard as their

poisonous effects can penetrate the minds of the policymakers and implementers,”

Nehawu said.

The workers’ movement went further to challenge Econex to clarify

the basis of its calculations and to inform the public as to who sponsored the


“Until the final policy document has been confirmed by Cabinet and

released for public comment by the minister of health, the assertions from

Econex and similar institutes remain guesswork,” it said.

While Finance Minister Pravin Gordhan may mention the NHI in his

first budget speech tomorrow, he was not expected to announce the launch of the


The plan is still regarded by most economists as being in its


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