The National Health Insurance Bill: welcome but flawed
By David Sanders & Louis Reynolds | Amandla Magazine Issue 59 | 10 September 2018
The People’s Health Movement South Africa (PHMSA) welcomes the National Health Insurance Bill in that it confirms Universal Health Coverage (UHC) through a single payer system as the platform for the delivery of health care. The goal of UHC is to realise the right to comprehensive health care of good quality for everyone on the basis of need, while ensuring that no one experiences financial hardship in accessing the care they need. The NHI should be funded through a solidarity mechanism where there is a cross-subsidy from the rich to the poor via taxation.
Although we support the principles that underpin the NHI, PHMSA has several reservations about whether the Bill can deliver UHC. More broadly, we remain deeply concerned about government’s ability to steer this ambitious project in the context of South Africa’s deep-seated and multi-pronged health crisis.
Administration of the NHI Fund
The Bill makes clear that the NHI Fund, overseen by a Board appointed or approved by the Minister, will be the only purchaser of health services from accredited providers, public and private. This will allow for strategic purchasing of those services that are necessary to reach defined health goals. A justifiable concern is the potential that exists for this enormous fund to be looted.
Services free at the point of use will be provided to permanent residents. Documented refugees and asylum seekers will be eligible for free emergency services, care for conditions of public health importance (presumably TB, HIV and other infectious diseases) and services for paediatric and maternal conditions.
Services not reimbursed by the fund (i.e. not part of the defined “package”) can be paid for through medical schemes or out-of-pocket. All users are required to be registered with a primary care provider (presumably a clinic, health centre or general practitioner) and will have to attend such a provider before being eligible for specialist care.
Services provided under NHI
The details of what services are to be funded (the benefit package) are not provided. It is hoped that the benefits package will be identical for all users of NHI-funded providers. However, the Government Gazette of July 2017 describes the proposed funding arrangements for five different groups, based on employment status. This is a concern, since it implies that there will be different packages for different groups. It is likely that the poorest and sickest in our country will receive the most limited package of services. If this occurs it will increase already existing inequality.
A “Benefits Advisory Committee”, supported by a Health Benefits Pricing Committee, will decide what the content of these packages will be. These important bodies have no representation from civil society or labour. This lack of meaningful public participation will bias the work and decisions towards hospital-centred specialist care and a narrow biomedical approach. It is essential to include civil society and labour on these committees. Their proceedings should also be open and transparent and accountable to the Minister and Parliament.
How will NHI purchase services?
Purchasing of services will be devolved to provincial and district level hospitals and at sub-district level to contracting units for primary health care. District Health Management Offices will play a co-ordinating role. There has been justifiable concern about whether these sub-district and district entities will have the capacity to undertake such detailed and complex activities. The mechanisms for payment of accredited service providers are vague in the Bill and it is strongly rumoured that medical schemes may perform this function.
PHMSA is concerned that urban and private providers are more likely to be accredited than public and (especially) rural providers. This risks aggravating already existing urban/rural inequity.
The Bill specifies transitional arrangements in three phases extending to 2026. The current second phase will focus on establishing institutions and on interim purchasing of personal health care services. Phase 3, from 2022 to 2026, will establish the necessary structures and be guided by two committees which will be responsible for a Human Resources for Health (HRH) development plan.
PHM has two concerns about these arrangements: firstly, an HRH plan is required urgently to ensure the development of a robust public health sector. Secondly, these structures have an unimpressive record to date in transforming health sciences education and training. Their composition has been proposed to include mainly hospital-based clinicians and educators. So it is unlikely that they will implement an appropriate HRH plan. It is more probable that the emphasis will be on facility-based clinical medicine. Primary and community-level care and prevention activities are likely to be marginalised.
The context: the national health crisis
While the crisis in the public health sector is front-line news today, the private sector is in a crisis of its own – growing medical scheme unaffordability, shrinking benefits and static or declining membership.
The roots of the crisis lie in the systematic underdevelopment and structural inequality enforced by apartheid. Its more immediate cause is the neoliberal Growth, Employment and Redistribution (GEAR) macroeconomic policy adopted by the ANC-led government in 1996. More than two decades of austerity, combined with a deepening culture of corruption, have aggravated both facets of the national health crisis. Firstly, the state has failed to address inequity in access to the social determinants of health (SDH) such as sufficient quality food, water, sanitation etc through poor service delivery and growing unemployment and income inequality. This has aggravated the burden of disease. Secondly, the tight financial constraints imposed on the public health sector by austerity, together with a growing and increasingly pervasive culture of corruption, has led to loss of posts and skills, deteriorating infrastructure, and de-moralisation of staff at all levels of the system.
Strengthening the public health sector
Before the public health sector can participate in the NHI it will need to be strengthened substantially. This will require strong political will and significant funds. Although the upfront financial commitment will be large, the returns on investment are potentially even greater – savings on long-term health care, improved economic productivity of a healthier workforce, and the multiplier effect in the economy of having a larger number of employed people, especially rural women.
Financing the NHI
The Bill says very little about possible sources of funding, but there are no real options other than through taxation and an end to austerity budgets. PHMSA believes that progressive income tax – a surcharge added to the normal income tax at an increasing percentage – would be the best option. The principle, that those who can afford it pay more while those who need more health care receive more care, also builds social solidarity.
There is no doubt that increases in revenue from tax are necessary to strengthen the public sector and finance the NHI. This may be difficult politically, but we believe there is room for such increases. Dick Forslund, in Amandla! and elsewhere, has shown that the tax burden on the middle class and the rich has decreased substantially over the past decades. If the government had merely kept personal income tax stable since 2005/06, there would have been more than R150 billion more to spend in the present budget. This would have made financing the NHI easier even before raising additional tax.
The alternative to tax is to borrow, which means eventually paying more and more government in-come towards debt servicing and away from delivering services.
It is also essential to root out corruption. Corruption weakens the state, delegitimises taxation, destroys public services, and ruins the social fabric. Corruption thrives in dark spaces where the public and private sectors meet. Forslund argues that “as long as the public sector isn’t strong enough to provide basic services, but relies on ‘partnerships’ and tenders, corruption will remain rampant”.
There have been many responses to the NHI Bill, most of them negative. Many contain uncomfortable truths about the state of the health system and the extreme difficulty of fixing it. But this strengthens the case for the NHI and an equitable health system based on UHC and the principles of Primary Health Care. The state, at present, does not have the capacity to deliver it. Nor can the corporate private sector. This places a major responsibility on civil society to give the state critical support and mobilise the public around health. It underpins PHMSA’s campaign for a “People’s NHI”.
The PHMSA calls upon all citizens of South Africa and civil society to unite behind a People’s NHI to ensure that the principles of the Right to Health, Universality and Social Solidarity are adhered to throughout the implementation process. To join the People’s NHI Campaign, please do one of the following:
• Dial *134*1994*333# (it’s free)
• SMS ‘NHI’ to 31660 (standard cost SMS)
• Visit http://bit.ly/2r22Tnl
• Or send a PCM to 066 040 9017
• Contact Anneleen De Keukelaere: email@example.com
David Sanders and Louis Reynolds are members of the PHMSA.