Looming NHI disaster would dwarf Eskom

04 March 2019
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As much as the country is currently focused on the crisis in Eskom, the nation seems to have lost sight of the looming NHI Fund, which will be twice the size of the failing power utility in financial terms. The State of the Nation address and recent launch of the Presidential Health summit report has only added to the uncertainty surrounding the National Health Insurance model and is still failing to address pragmatic issues surrounding the funding behemoth, such as what it will cost and how the state will render services within the NHI context.

President Cyril Ramaphosa said in the SONA address that “By introducing the NHI together with a multi-pronged quality improvement programme for public health facilities, we are working towards a massive change in the health care experience of South Africans.” In the presidential summit launch Dr Aaron Motsoaledi expanded by saying that “This ‘war room’ brings together various key departments to address the crisis in the public health system while preparing for the implementation of the NHI. We are guided by the insight that improving the health system and introducing NHI are two sides of the same coin and are mutually reinforcing.” The NHI Draft Bill, however, states quite clearly that the NHI Fund will only contract with facilities accredited by the Office of Health Standards Compliance (OHSC).

This creates ambiguity, as the last OHSC inspection results indicated that only 6 of 696 inspected public facilities passed quality inspections. This would leave 690 facilities unable to contract with the NHI fund or deliver services to South African citizens within an NHI environment. These inspection results do not reflect the situation in the other 2600 state facilities that were not inspected in 2017. If similar quality prevails in these remaining facilities, there would be 30 public clinics and hospitals qualifying to contract with the NHI fund and render NHI services to South Africans. It is therefore inconceivable that NHI can be implemented without a radical, comprehensive quality improvement programme in the public health sector preceding it. It makes little sense to indicate that these processes will run in a parallel manner, as it will create a major shortage of state health services available to public health users.

These illogical comments reaffirm what industry experts have been suspecting for quite some time- that the current flurry of NHI related rhetoric is all about political gain for the upcoming elections. Cosatu has also not given the proposed policy sufficient scrutiny, or there would have been as much opposition to NHI on that front as with the current Eskom split proposals. The only way to fix the public health system is to start introducing competent management at all levels. This would mean getting rid of entrenched union members in order to make NHI happen. Further to this, the NHI fund will be taking over a host of Provincial health functions and allocated funding. All hospitals currently falling in the Provincial authority will either be reimbursed directly by the NHI Fund, or via the district contracting unit for primary healthcare. In the absence of service related funding flows to provinces, one would have to wonder how many administrative posts will be culled in the various provincial health departments as a result of this new funding arrangement. There is also the question of job losses in provincial clinics and hospitals who do not qualify to contract with the NHI fund. The employees will no longer be employed by the province, but by the individual healthcare facility. The funding flow to such facilities will be wholly dependent on service delivery to NHI. Failure to contract with the NHI based on quality criteria, will leave no money available to pay salaries of employed professionals and administrative staff in such clinics.

The World Bank gave South Africa a score of 69% for Universal Health Coverage in 2016. This was based on the system in 2010, when there were still R20 co-payments for low income earners at state facilities. This has subsequently fallen away, improving the UHC score and providing free access to state services. The remaining unaddressed aspect was lack of quality. Improving the current public sector quality would probably rank South Africa higher on UHC than the 76% Estonia gets for their single payer, state run health system. It raises the big question of whether the government goal is to provide free access to quality health services for all, or simply to get rid of the two tier system through NHI implementation, irrespective of the catastrophic employment consequences.

Dr Johann Serfontein is a member of the Free Market Foundation Healthcare Policy Unit

This article was first published in Businesslive.co.za on 21 February 2019

 

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