Universal healthcare for all: What NHI in South Africa could mean for you

With just under two weeks remaining before the 2024 Election Day, President Cyril Ramaphosa has pulled the trigger and finally signed the National Health Insurance (NHI) bill into law. However, despite being promoted as a solution to South Africa’s numerous issues with the healthcare system, the NHI bill has generated considerable debate, and is likely to encounter significant obstruction by various stakeholders before it can be fully implemented. What does this mean for the average healthcare user in South Africa? How will it impact private care?

Understanding the NHI:

The NHI operates as a pool of funds from which the government will purchase health care services for all residents of the country from health care providers in both the public and private sectors. The NHI will cover a wide range of health services, including primary healthcare, specialist services, hospital care, and ancillary care. Services will be free at the point of care, eliminating out-of-pocket expenses for covered treatments. This means that whenever you require medical attention, you can go to your nearest general practitioner (GP) or clinic that has a contract with the NHI without concerns about the cost of care.

History of NHI:

South Africa's pursuit of National Health Insurance (NHI) traces back to its ongoing efforts to address healthcare disparities. The idea of a national health fund is not new: shortly after democracy was established in 1994, the newly elected African National Congress (ANC) published a health plan that proposed the use of a “needs-based resource allocation mechanism” by the central health ministry. This mechanism aimed to distribute health funds between geographical areas; remove public sector fees for pregnant women, nursing mothers and children under six; and develop some form of national or social health insurance . The idea was first formally introduced in 2011 with the release of the NHI Green Paper, initiating a period of public consultation and pilot projects that aimed at strengthening the healthcare system. This was followed by the NHI White Paper in 2015, which laid out the framework for achieving universal health coverage. The NHI Bill was passed by the National Assembly in 2023 and, as of 15 May 2024, has officially been signed into law.

What exactly is Universal Healthcare coverage?

Universal Health Coverage (UHC), as defined by the World Health Organization (WHO), refers to the principle that all individuals and communities should receive the health services they need without suffering financial hardship from unaffordable out-of-pocket payments. UHC encompasses several key components: access to appropriate healthcare services (including health promotion, treatment, rehabilitation, and palliative care), protection against healthcare-related financial risks, and the universality of care provision. Additionally, UHC should be accessible physically, financially, and socio-culturally. There are numerous benefits that can be achieved through the implementation of UHC:

1. Improved Health Outcomes: UHC facilitates access to a comprehensive array of health services, leading to reduced mortality rates and overall improvements in population health.

2. Financial Protection: UHC minimises the risk of financial burden due to high out-of-pocket health expenditures.

3. Equity in Access: It aims to eliminate disparities in access to healthcare services, ensuring that even the most vulnerable populations receive the care they need.

4. Economic Benefits: A healthier population contributes to greater economic productivity and stability, reducing the economic burden of disease on the society.
   

Image source: Universal Health Coverage (UHC) by NCD Alliance (https://ncdalliance.org/why-ncds/universal-health-coverage-uhc)

UHC is a central tenet to achieving better health and well-being for all people within a population, and is emphasised in the 2030 sustainable development goals. However, data from a 2023 report show that progress towards achieving UHC globally has stagnated, with  approximately 4.5 billion people lacking essential health coverage . The cost of healthcare has consistently increased year-on-year, with healthcare cost-related inflation exceeding standard inflation by 4-5% in recent years . These costs, combined with other cost-of-living challenges, present a significant obstacle to improving coverage and access to healthcare while minimising their potential financial implications.

Role of private sector:

The NHI bill has encountered opposition from private healthcare providers and medical schemes due to concerns about its potential impact on their operations and financial sustainability. With this fund, private entities will be required to contract with the NHI fund and adhere to standardised payment rates. Upon full implementation of the NHI, only medical treatment not covered by the fund will be eligible for private, complementary funding by medical aid schemes. Although specifics regarding coverage scope remain unclear, it is likely that interventions such as minor cosmetic procedures will be among those excluded from coverage. Interestingly, many stakeholders propose that investments should prioritise enhancing the public healthcare system instead. However, the reality is that addressing the stark inequality between the public and private sectors would require a comprehensive overhaul. Achieving UHC is particularly challenging in countries with substantial private healthcare sectors and may be better suited to playing a complementary role in healthcare provision .

NHI: Style over substance

One major concern raised by various stakeholders is the lack of sufficient detail in the legislation, hindering a thorough assessment of its feasibility. Details concerning its actual cost, the proposed funding model, administration, and mechanisms of accountability, are among many deficits that have been noted. South Africa’s approach to implementing new health policies has previously been described as "scattershot", with minimal consultation, planning, or pilot programming required for reforms of such scale . There are also uncertainties surrounding the impact on private health consumers' medical aid contributions during the NHI introduction, potentially leading to double or triple tax implications for them. These unresolved financial and administrative issues fuel significant apprehension among healthcare providers and consumers alike. Addressing these concerns demands a more comprehensive and transparent approach to policy implementation. For the NHI to succeed, detailed planning, stakeholder engagement, and pilot testing are imperative. Only through these measures can South Africa realize the promise of universal health coverage, ensuring that every citizen accesses quality healthcare without financial burden.

Addressing healthcare inequality in South Africa

South Africa has the highest Gini coefficient globally, an indication of extreme inequality. A disproportionately higher share of South Africa’s  total health expenditures is spent on private voluntary health insurance (41.8%) than any other country globally – more than 6 times the OECD average – despite only serving 16% of the population . Additionally, approximately 9% of the country’s gross domestic product (GDP) is spent on healthcare. These figures are similar to those of countries with comparable socioeconomic indices like Brazil and Mexico, however, indicators such as increased maternal and under-5 mortality rates suggest that the current healthcare system falls short in delivering equitable, cost-effective care. Considering that the NHI aims to improve equity in healthcare provision, addressing this inequality will be one of the greatest challenges to overcome. The success of the NHI will largely depend on its ability to bridge the gap between the public and private healthcare sectors, ensuring that high-quality healthcare is accessible to all citizens, regardless of their socioeconomic status.

Data source: Department of Health. National Health Insurance White Paper. Department of Health. Available from: https://www.gov.za/sites/default/files/gcis_document/201512/39506gon1230.pdf.

Remaining concerns: Corruption and sustainability

Corruption remains a significant concern in the implementation of the NHI, particularly in light of South Africa’s history of corruption within its public sectors, including healthcare (Did we ever recoup the COVID-19 billions?). This has a significant negative impact on public trust and undermines the effectiveness and acceptability of healthcare initiatives. For the NHI to be sustainable, robust anti-corruption mechanisms must be put in place, including transparent procurement processes, stringent oversight, and mechanisms for accountability.

Furthermore, the sustainability of the NHI hinges on its financial viability. The government must ensure that the funding model is resilient and capable of adapting to economic fluctuations. Continuous investment in healthcare infrastructure, workforce training, and technology is essential to maintain high standards of care and prevent the system from becoming overwhelmed. Addressing these issues head-on through comprehensive policy frameworks, effective governance, and stakeholder collaboration will be crucial in realizing the goals of the NHI and achieving sustainable, universal healthcare coverage in South Africa.

The NHI represents a major shift in South Africa's healthcare landscape, aiming to provide equitable and affordable healthcare for all citizens. However, its success will depend on effective implementation, adequate funding, and robust governance to address the challenges and concerns raised by various stakeholders. The path to universal health coverage is fraught with obstacles, but with careful planning and dedicated effort, South Africa has the potential to create a healthcare system that truly serves all its people. The promise of the NHI transcends mere policy; it embodies a collective commitment to health equity and sustainable progress.

Photo credit – Pixabay: https://www.pexels.com/photo/umbrella-lot-268941/

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