Finances plague NHI pilot project

The long-term viability of the National Health Insurance (NHI) system is in doubt because its pilot project sites appear to have financial problems and have failed to pay the salaries of its medical professionals.

Doctors and pharmacy assistants contracted to assist in the project have seen their debit orders bounce while they wait for salaries from the department of health’s appointed payroll administrator.

The department appointed the Foundation for Professional Development (FPD) as a service provider to deal with administrative processes, including the payroll.

In emails sent on December 14, which City Press has seen, the foundation’s payroll manager, Jackie Swanepoel, told doctors and pharmacists that the FPD was unable to pay their salaries.

“Due to unforeseen circumstances beyond our control, we will not be able to settle payments due on the 15th of December to department of health employees.

“We are aware and understand the inconvenience caused by this, and are committed to resolving the matter with the department of health and the Treasury as soon as possible. We kindly request your understanding in this matter,” Swanepoel wrote in the email.

One doctor, who spoke on condition of anonymity, said the financial problems were not limited to December.

“We had similar problems in September, October and November. The salaries are not paid on time and when we inquire, we are informed the department did not pay the service provider.

“We are still expected to wake up every morning and work as if everything is normal. Several doctors and pharmacy assistants have already quit their jobs and more will follow if the problems are not resolved,” he said.

The foundation’s chief operating officer, Henk Reeder, said he understood the concerns raised by the health practitioners but, “unfortunately, FPD is contracted by the health department to provide only a payroll administrative service and, as such, we are not in a position to comment on the health department’s structures and processes”.

The pilot project, which started in April 2012, has 326 pharmacy assistants and 203 general practitioners (doctors) on the books.

It will end in March, when government is expected to announce when the full NHI system will be launched.

Issues surrounding NHI funding were investigated by the Davis Tax Committee, which delivered its report on the financing of the NHI in October 2016. The government’s white paper on the NHI previously said it would require R256bn in annual funding at 2010 prices. The report estimated that, by 2025, a funding shortfall of R72bn would be expected at an assumed average growth rate of 3.5%.

The report said that, at the real economic growth rate of just 2%, it would result in a shortfall of as much as R108bn by 2025.

Health department spokesperson Popo Maja confirmed that external payroll administrators were dealing with the project.

“The general practitioners and pharmacy assistants received their monthly payments after the 15th of the month for September and October 2016 due to a change of payment administrators, and after the 15th of November because the health department experienced an unforeseen glitch in the administrative support for this project,” he said.

Maja said these payments were not necessarily late because the contract with the health professionals stated that “payment will be made by the department of health within 30 days from the date of receipt of a valid time sheet, authorised by the district manager”.

He said the affected health professionals were not employees, but service providers.

“Except for the periods mentioned above, the department has, however, out of our high regard for their services, persevered to pay them on the 15th of every month,” he said.

Maja said the problem would not affect the introduction of the NHI as the doctors and pharmacists have received payments for more than 50 months without a problem.

“This does not set the tone for what will happen under NHI. This is a pilot programme managed by the health department. It was mainly conducted to gauge interest from private health practitioners, to test models for cooperation between health practitioners and other clinic staff, and to test payment and administrative mechanisms.

“The NHI fund will be a separate entity with its own administrative processes.”

Asked about the resignation of some medical professionals, Maja said it was not true that professionals were leaving the pilot project because of late payments.

“Whenever people have an issue with the public sector, they drag in the NHI. The issue of late payment has been resolved.”

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