NHI not conducive to quality health outcomes

Chris Hattingh is a member of the Board of the Free Market Foundation. He has an MPhil in Business Ethics from Stellenbosch University. Chris Hattingh is a member of the Board of the Free Market Foundation. He has an MPhil in Business Ethics from Stellenbosch University. 

There is resounding societal support for universal healthcare in South Africa, in which the entire population would have access to free health services. However, the problem arises from the vehicle that would administer such services; in South Africa’s case, this vehicle is potentially the National Health Insurance (NHI) model. The NHI model presents a serious sticking point for many citizens who desire universal care, but are doubtful that a government-run system is the best way to achieve it.

Vishal Brijlal, Director of the Clinton Health Access Initiative, recently stated that of the 117 people who made oral comments on the NHI Bill in the past two and a half years, only 20% unequivocally supported it. The Clinton Initiative is a global health organisation committed to helping save the lives of people living with HIV/Aids. Brijlal was speaking at the annual congress of the Board of Healthcare Funders, the representative organisation for the majority of medical schemes in Southern Africa.

Such findings indicate that, while many South African organisations and citizens support the idea of universal healthcare, they are very far from convinced that the NHI model would be the most appropriate vehicle to achieve such an outcome. The government would do well to listen to this view, and to fundamentally change how it views its role in ‘managing’ people’s healthcare.

The NHI model will grant increased power to the Minister of Health, as well as concentrating private and public sector resources in the hands of the state through the NHI Fund. The Fund would be the sole provider and contractor of healthcare services. The Minister would also have the additional power of being able to appoint everyone on the board of the Fund. This is one sure method to bring about more (real and perceived) corruption, cronyism, and inefficiencies. By pooling so much money in the hands of bureaucrats and politicians, the incentive for unethical conduct will only increase.

During his address, Brijlal added that the responses received by the committee indicate great concern that the health minister will have too many powers under the NHI. Given the numerous corruption issues that have plagued the government of late, this concern ought not fall on deaf ears among policymakers.

We have seen the consequences of mixing the state with the private sector, as the numerous powers and controls of the government have steadily extended over every aspect of the economy and daily life. This control increases the chances of abuse, and politicians and bureaucrats, regardless of which party they may belong to, have more scope to interfere with people’s decisions. These incentives for cronyism must be pared back considerably.

It is also unclear whether the Department of Health has the requisite expertise and skills capacity to manage a system as complex and intricate as the NHI would be.

Simply putting more money into a centrally managed fund would in no way solve the infrastructure or management issues that plague most public facilities. There could be scope for public-private partnerships and skills-sharing, as we have seen throughout the COVID-19 pandemic. But for that to happen, and for South Africa’s excellent doctors and nurses to remain in the country to share those skills in the first place, they need to know that they will be free to work where they find the best fit, and be able to move around as necessary. NHI would simply add another reason for such professionals to consider emigration.

Christoff Raath, co-CEO of Insight Actuaries & Consultants, spoke at the same congress as Brijlal.

Raath said that millions of poor South Africans paid out of their own pockets for private doctor and dentist visits. They were forced to do this because they could not afford to queue for hours at public clinics and hospitals. He added that low-cost medical benefits (LCBOs) and the availability thereof, through the necessary regulatory changes, could alleviate pressure on state facilities. Such changes could then also, most importantly, help poorer citizens gain to access private medical services.

The Council for Medical Schemes has been dragging its feet with the adoption and implementation of a new LCBO framework since 2015. It is regulatory barriers against products such as LCBOs that inhibit people’s healthcare options, and which force poorer South Africans into yet more dependence on declining state services.

Instead of focusing its limited resources on an unachievable system such as the NHI, the state should rather pivot towards upgrading and maintaining public facilities and opening more of these to private ownership. Speeding up the adoption of a new LCBO framework will also ensure that poorer citizens can access quality care through private sector options.

Lastly, the state can provide vouchers for indigent citizens to access care at any facility of their choosing. It is immoral to continue to force citizens to inferior state facilities, and to promise them that a system such as the NHI would ever truly work when all the evidence points in precisely the opposite direction.