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National Health Insurance

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The National Health Insurance (NHI), for which membership will be compulsory, is a funding scheme that aims to address healthcare inequity in South Africa. The scheme will do this by creating a fund that the government will use to buy healthcare services at set fees from accredited public and private health providers. The NHI Act was signed into law on 15 May 2024 but before it will come into effect, Parliament will need to enact further legislation (including ones providing for its funding).

HomeArticlesNHI a healthy dose to cure South Africa’s sickly system

NHI a healthy dose to cure South Africa’s sickly system

Although the scheme’s white paper was released at an economically uncertain time, it brings possibilities to those in need.

The release on December 11 2015 of the much anticipated National Health Insurance (NHI) scheme white paper took place at a time of heightened anxiety for every South African and the investor community alike.

For many, the publication of the white paper may have paled in comparison with the drama caused by the change of finance ministers in the days preceding its launch.

But for those of us who live and breathe healthcare, we were deeply moved by the significance of this milestone and excited by the possibilities it brings for the future health and wellbeing of the citizens of our country.

Since the end of World War II, we have acknowledged the need for a universal healthcare system as a fundamental requirement to transform us into a productive, stable, inclusive economy.

In the past two decades we have committed to universal access as a constitutional right and have prioritised the principles of equity and access in the provision of healthcare services.

On December 11 last year, we took a major leap forward towards realising this vision by setting out a plan bound by a 14-year timeline; definitions, features and principles; and definitive choices that imply future trade-offs and structural reforms of the public and private health sectors.

As a collective, we understand that we urgently need to improve the delivery of community-based and primary healthcare services, because these are the foundation of an effective healthcare system.

Learning from the successes we achieved with turning the tide against the HIV epidemic, we recognise the importance of patient empowerment, health promotion and close collaboration with an activated citizenry.

The white paper states that the first five years of transformation should begin with establishing comprehensive quality healthcare services closest to where people live.

If we are able to achieve this goal, our country will begin to see the first semblance of what a true national asset really looks like.

Curing our ailing healthcare system would be directly linked to enhancing our pool of human capital, improving labour productivity, pursuing stronger economic growth and embedding greater social stability and cohesion into our societies. Just what the doctor ordered.

Centralised tertiary services, more effective referral pathways, a registered population, standardised clinical protocols and more robust governance and management platforms would also work synergistically to use of the healthcare rand optimally and ensure that the right patient is treated at the right place and at the right time.

Resources are scarce, so the existing wastage and leakages in the system could indisputably be put to better use.

Healthcare workforce development is also prioritised as an urgent focus of the reformations.

South Africa has a meagre 0.776 medical doctors per 1 000 population compared with Brazil’s 1.891, China’s 1.491 and the United Kingdom’s 2.809, according to the World Health Organisation.

In addition, the South Africa Medical Association indicates that about 70% of doctors in South Africa work in the private sector, mainly in the urban areas.

The private healthcare sector serves only 16% of the population. The remaining 30% of doctors, employed in the public sector, work across urban and rural South Africa.

A survey done in 2009 showed that only 3% of newly qualified doctors will end up working in rural areas. Considering that about 38% of the South African population lives in rural areas, the shortage of doctors there is critical.

It is clear that implementing the NHI will require a major scaling up in public funding for healthcare.

The white paper states that the financing of the scheme will be co-ordinated through a central insurance fund, the National Health Insurance Fund, which would be financed by a mixture of taxes.

But it is still unclear how the required R225-billion will be raised under the current economic climate and small active tax base that exists in South Africa.

The future role of medical schemes also remains a source of uncertainty and many are watching how the ongoing Competition Commission inquiry will contribute to the need for transformation in the private healthcare sector.

Healthcare systems are ultimately a reflection of the societies in which they develop – the fundamental changes in our healthcare system mirror the desire for change in our country.

Equity, inclusivity and patient-centricity demonstrate our core values as a nation and the hope that, one day, every South African will get the care they so desperately need and deserve.

Dr Anuschka Coovadia is the head of healthcare markets for KPMG in Africa.