NHI is ‘still years from implementation’

Government appears determined to forge ahead with the proposed National Health Insurance (NHI) fund despite the fact analysts insist it is currently unaffordable given the lack of economic growth.

Essentially, what government is aiming for is one single, state-controlled medical aid fund servicing all South Africans.

That SA’s publicly funded public health care sector is in an appalling state is well known. Overburdened, underresourced and poorly managed, it services more than 80% of the population. The country’s private health care sector, on the other hand, offers high quality medical care but only to those who can afford it or are members of medical schemes.

Government’s proposed NHI is an ongoing threat to medical risk planning, says financial advisor Dawn Ridler. “If the past 18 months has taught the department of health anything, it is this is a pie-in-the-sky dream and unworkable for a country with a small, fragile tax base.”

Ridler believes if NHI is implemented as it is currently envisioned, it will be the end of all private medical care with private hospitals and all medical aids ceasing to exist unless they have a licence to practice in the public health care sector.

“In my opinion, if it is implemented it will result in a huge brain drain of medical personnel and taxpayers. Highly educated medical personnel will not accept becoming government employees, on government salaries, when they will be welcomed with open arms anywhere in the world.”

Medshield Medical Scheme’s Thoneshan Naidoo is an outspoken advocate for a more equitable health care system — something he says is possible through NHI. However, he insists that unlocking an enabling NHI is only part of the solution and that it must coexist with private health care and medical schemes.

“South Africans are blessed with the benefit of a world-class private medical sector which is on a par with first world countries. Our private health care sector is a national treasure and, as such, should be protected and nurtured.”

No other universal health care system, including the UK’s NHS, has prohibited or destroyed its country’s private health care system, Ridler points out. “The UK’s NHS is far from perfect, and queues for even urgent surgeries can be months, but you do have the choice of getting private health care at your own cost.”

The UK spends about 7% of its GDP on the NHS. This year government spending in SA on health is about R250bn, making government expenditure on health about 6% of GDP, says Ridler, adding that lower income countries, of which SA is one, tend to spend on average 1.6% of GDP on health.

“It might be an idealistic dream but perhaps with a private-public collaboration, government health care can be properly administered, cleaned up and the standard of care lifted,” says Ridler.

Naidoo adds that careless comments made by individuals who don’t understand the reserves of medical schemes legally belong to members has heightened concerns around the implementation of NHI.

Medical aid schemes, Ridler reveals, have been engaging with government behind the scenes on the issue of NHI. “The general feeling is this is still years from implementation. In 2019, when the NHI took another step forward in the parliamentary system, no budget was published for what is, essentially, a pipe dream.”

SA’s tax base is small and somewhat fragile — about 800,000 people or 1.6% of the total population earn more than R500,000 per annum and contribute about 70% of the individual tax. “Taxpayers have come to accept they have to pay for private education, private security, make their own pension provisions and pay for private health care. Removing the choice of private health care would be a game changer that government cannot ignore,” says Ridler.