How Will The National Health Insurance Impact You?

The proposed National Health Insurance has rubbed doctors and medical aid brokers up the wrong way. How will it impact YOU?
Jason Snyman
2018-07-03
It wasn’t too long ago that we wrote about the compulsory National Health Insurance set to hit South Africa. Not only did the Minister of Health, Dr Aaron Motsoaledi, present the National Health Insurance bill last month, but also the Medical Schemes Amendment Bill seeking to align the medical aid industry with the NHI. Should the latter be implemented, we could see a massive shakeup in the public and private healthcare sectors. As reported by the Sunday Times, South African doctors are ready to leave the country should the Bill be put into law. It’s worth noting that they are not threatening to leave if the bill gets passed. Rather, they are indicating that their leaving would be a direct consequence of the contents of the bill, which would leave them with no choice but to seek greener pastures. Good doctors are already scarce. Given the dismal state of public hospitals, private healthcare has become an indispensable service. The new legislation will probably cap the amount which these private doctors can charge, though. They’re not too happy about that.
“If they are going to trash the private sector in order to get the public sector up and running, doctors are going to go,” said Profmed officer, Graham Anderson. “If the doctors emigrate then other professionals, who can afford to leave, will go because they want healthcare for their children.”
What the Bill proposes, in reality, is the nationalization of healthcare. And as it is with so many other industries – if you nationalize it, the private sector will pack up and vacate. That’s a big problem in this specific industry, with many creases to iron out. There’s certainly trouble on the horizon. The National Health Insurance is pretty much unavoidable – so how will it impact your life?
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Implementing The National Health Insurance

The two Bills will lead to a shift in policy, and will no doubt require a complete reorganisation of the entire healthcare system. Speaking to the NCOP, Motsoaledi said:
“We have already identified 12 Acts that will have to be amended by this House (the NCOP) to accommodate NHI.”
According to the Minister of Health, there are four areas which will need to be addressed, governed and properly controlled in order to stabilise the healthcare system. He named the Life Esidimeni tragedy among the major health disasters which have occurred due to these four issues. They are:
  • Human resources;
  • Financial management;
  • Procurement and supply chain management, and;
  • Maintenance of infrastructure and equipment.
 

Funding For The National Health Insurance

The NHI will apparently cost the public purse up to R180 billion every year. Minister Motsoaledi is yet to confirm exactly how this proposed Bill will be financed. The buck has been passed to National Treasury, as usual, who will have to find the means. One idea being kicked around is to do away with medical aid tax credits entirely. Many people aren’t going to be too happy about that. Around 20% of those with medical aid are only able to finance that medical aid thanks to tax credits. To do away with them would mean that the NHI would have to be 100% operational. Otherwise, the loss would be too great. The most popular idea is to pool all the payments contributed by South Africans into one fund. The amount of which is to be determined by how much you earn. This would allow the NHI to effectively buy healthcare services from both public and private sectors and provide everybody with access to them.
“Yes, under NHI, the rich will subsidise the poor. The young will subsidise the old. The healthy will subsidise the sick. The urban will subsidise the rural,” said Motsoaledi.
For many South Africans, the NHI will be a saving grace – a mandatory fund for free, high quality healthcare for both rich and poor citizens. It looks really good on paper, and it’s a strong commitment to equality. Whether it can measure up to reality is yet to be seen, though, but most are quite doubtful of its success. No official funding plans have been announced.
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Your Medical Aid

Medical aid will still be available. The NHI will be mandatory, though, and South Africans will be required to pay towards the fund before they pay their medical aid premiums. This is, of course, if you would still like to keep your medical aid at all. Medical aid brokers, however, may soon find themselves without a job. What many members of medical aid schemes don’t know is that almost 2 out of 3 pay a broker every month as part of their premium. In 2017, the total amount paid to medical aid brokers was R2.2 billion. The Department of Health would rather put that money toward paying for direct health expenses, and have declared brokers unnecessary.
"What do you need brokers for?” asked Motsoaledi. “They are sitting and earning money for a service that is not necessary. Why can’t that money be used for diseases, for people who are ill?"
Motsoaledi has also said that government subsidies for civil servants – and the specific schemes that are restricted to government employees – will eventually be eliminated. Those who can afford to pay for medical aids would have the option to top up, though. Indeed, one of the biggest obstacles that the government’s NHI faces will be to convince South Africans that they will receive quality healthcare from the public sector. Anybody who has ever been to a public hospital will know – that isn’t going to be easy. Olive Shisana, speaking at this year’s SA Medical Association conference, said that if the NHI went ahead at this very moment, only 16% of the government’s health facilities would qualify for use in terms of the guidelines introduced by the Office of Health Standards Compliance. This office has been set up to inspect healthcare institutions, ensuring that they comply with strict maintenance and cleanliness standards.  

Private Healthcare Sector

The biggest problem with the Bill, today, is the lack of context. Plans have been declared, but the medical industry hasn’t been given a lot of details – leaving professionals uncertain about their future. It’s a breeding ground for speculation. Yes, private healthcare is incredibly expensive. Very few South Africans are fortunate enough to afford it. That doesn’t mean, however, that private healthcare is a problem. These doctors are valuable, and they get paid accordingly. If the government were to regulate the fees which these doctors could charge for their services, it’s easy to understand why they would feel the need to take their services elsewhere. Lower tariffs could leave them bankrupt, or at least not doing as well as they could be. Why would they stay? And when they leave, it will be a crippling blow to the already overworked, abused and overburdened healthcare sector. Those who elect to stay would have to contract with the NHI fund. Reportedly, medical schemes would only be allowed to pay for services which are not covered in the NHI. At the moment we’re not even entirely sure which services those will be. We’ll likely only know for sure if (when) the Bill is put into law. We’ve reported before that the National Health Insurance is set to be implemented in three phases over a 14 year period. The actual date of implementation has not been revealed. At the rate things are going right now, the Bills may only appear before parliament after the upcoming elections.