Sunday 18 August 2019

The National Health Insurance Conundrum


The definition of insanity is doing the same thing over and over again and expecting a different result each time. – (Allegedly) Albert Einstein

I’ve always wondered what really goes on in the mind of the South African politician. The blatantly senseless introduction of a National Health Policy which has been proven to be a complete failure during its Pilot phase, has given the (progress) naysayers enough political fodder to denigrate the ANC government until the next National elections.

While some would rubber-stamp the policy as an instrument for achieving equality in the healthcare sector, others see it as a waste of money and resources at a crucial time when the Government really don’t need to undertake additional senseless expenditure, suffice it to say, from non-existent funding.  Given the state of our healthcare system, I would agree with the latter group.  The NHI policy may have really good intentions and may be a ground-breaking piece of legislation in the history of our young democracy, but sadly the Bill is lacking in crucial detail and the timing is questionable.

The Public Healthscare Phenomenon

The Public Healthcare system is grossly underfunded and understaffed. The Health Facilities are old and dilapidated. Hospital and clinic Infrastructure is falling apart. Employee morale is all but non-existent.  The cold stares and subtle, sorry, blatant verbal aggression from staff would leave one with additional psychological scars after visiting a health facility. Anyone who has had the unfortunate experience of visiting a day clinic or a public hospital would know that their day is basically fucked, and they should know to pack a picnic basket and a blanket (in winter, one may as well sit outside in the cold, rain). The average time spent in a clinic for an average patient is nothing less than 4 to 5 hours, with moerse (sic) long queues starting long before the clinic or hospital doors open. It’s not enough that more than 80% of the population is subjected to such psychological torture, that they still have to endure the wrath of incompetent Health “Professionals”.

Most day clinics are staffed with a bunch of Interns let loose from their Academic Institutions to use the sickly poor as their lab rats. Whether diagnosis and prognosis are sound is neither here nor there. Their efficiency is measured by the number of times a patient may return for the same symptoms. The number of qualified doctors and specialists in the Public Health System are comparable to extinct animals. You just don’t find them as freely as you would find one in the private sector. But, can one blame these guardians of the welfare of the population? What with working long hours for a tenth of the remuneration his fellow professionals would get in the private sector. The lack of available resources and equipment to carry out his profession effectively, and the threat of crumbling infrastructure is enough to drive any healthcare public servant into the private sector, or as is the current trend, to greener pastures over there.

Then there are the various hospital tragedies where hundreds of patients died from blatant neglect and corruption…….maybe I’ll discuss that on another day when I’m not sick to my stomach of just thinking about it. As a result, the National Department of Health is facing an array of Lawsuits which is being paid for by Government Funds meant for the delivery of Healthcare services; one innovative way to kill off more of the poor and poverty stricken, and so the cycle continues.

The Sound of Music
Source : Gstatic.com

Conversely, the Private Healthcare system is purring along quite nicely with enough Surplus Funds to buy out the Public system. Any Private medical aid scheme that claims they are not making a profit, are only comparing their bottom line to the previous year, because they didn’t meet their target of increasing profits by another 20% (A bit of a stretch , but you get my drift).

Compared to heath facilities in the Public sector, when you walk into a private GP Consultation room or hospital, you’re greeted with lots of smiling faces and a Doctor whose behaviour and “Professionalism” can be compared to nothing less than saintly; it’s like walking into a scene from the movie, The Sound of Music.  You’re pampered and spoiled with air-conditioning in summer and heating in winter, complimentary reading material that is three years old and other small titbits of insignificance. But you KNOW in the back of their minds they’re relishing at the fact that they’re going to screw your medical aid, and go about it “Professionally”.

As a private medical aid member for the better part of 30 years, I took this privilege for granted and used and abused it to the best of my feigned health fragility (I was justified, given the huge chunk taken out of my salary every month). Yet, most times, the total yearly cost of my family’s medical expenses NEVER exceeded the yearly contributions. At times I wanted to level the playing fields by living a grossly unhealthy lifestyle, subject my family to the same, and hope, by way of more medical expenses, I would get my money’s worth. But these fuckers are tricky; they have this very cool “incentive”, called the medical savings account, where you as the ignorant member fall for the trick of having additional funds for emergencies or extraordinary medical expenses, although you are already paying almost 10% of your salary to cover those very expenses. When you eventually realise you’re being screwed, they’ve already taken the balance of your “savings”, which would be protected by a clause that says it cannot be carried forward (you know, like an accounting transaction) to the next year. But I digress.

The Private Healthcare system services just under 20% of the South African Population but accounts for 50% of the total National healthcare budget. The patient-to-doctor ratio is six times higher in the Public Sector compared to the Private sector. Over the last 10 years private hospitals have increased their tariffs by almost double the rate of inflation, hence the huge profits enjoyed by the biggest 3 Hospital Groups, i.e. Netcare, Life Healthcare and Mediclinic, with Discovery Health coining it in the medical scheme segment. The Private Healthcare system in South Africa is such a monumental money making machine, that International investors are falling over their feet to buy into it. Yet the 20% of South Africans using Private Medical care is none the wiser as to how they’re being ripped off in broad daylight.

The huge profits made in the Private Healthcare System are mainly attributed to:
    
  • Higher than inflation membership scheme contribution increases
  • Higher than inflation tariffs and other Hospital charges
  • Disproportionate distribution of benefits  per medical plan
  • Higher percentages of contributions going to non-healthcare costs
  • A lack of Competition in the Hospital and Medical Scheme markets
  • Member and Consumer apathy in relation to Scheme plans and Medical jargon
  • A lack of measurement data to assess Quality Healthcare from really bad Healthcare; (except between Public and Private Sectors, but not within the Private sector)

National Health Insurance for Dummies

So, now that we know the Public Health system is fucked beyond comparison, and the Private Healthcare system is rolling in billions from ripping off the Middle class, how would the NHI bridge this huge gap in equality? To answer this, here are a few thoughts which our esteemed Minister of Health, Dr Zweli “NHI will be implemented whether you like it or not” Mkhize has to offer.

Firstly, as mentioned the primary goal of the NHI is to bring quality, affordable Healthcare to every South African citizen, and to reduce the high cost of private healthcare. Suffice it to say that the access to free healthcare should be a Constitutional right, because after all, a healthy populace would ensure a healthy workforce, not so? If so many European and Latin American countries can do it, it shouldn’t be that much of a challenge? Right?

According to the National Treasury, the cost of the NHI Bill will be in the region of R256Billion, but this figure will be revised as the Project is rolled out. Some analysts have put the total cost in the region of around R450B, when taking into consideration the current costs of National Healthcare as a percentage of GDP. Right there is already a huge problem; when the Einsteins of a piece of legislation don’t even know how much said legislation is going to cost…..

Funding for the Bill, will be borne out of a series of Taxes; (and don’t take the phrase “born free, taxed to death”, lightly).
  • General Tax,
  • Medical Scheme tax credits,
  • Employee and employer payroll taxes, and
  • A surcharge on Personal Income Tax.

The Establishment of an NHI Fund, which would be a centrally controlled State-owned entity, (you know, like the many failed SOEs that we already have), will be introduced to manage and control payments into and out of the scheme, to ensure “transparency” and “Accountability”……right!

The services offered by the NHI have been touted to be basic comprehensive healthcare services; although, no definition of these services have yet been documented in the Bill. The bill states that a person seeking health care services from an approved health care service provider must be registered as a user of the NHI fund, and must present proof of such registration in order to use the benefits to which they are entitled; likewise with specialist services. Over time your medical aid will provide only health services that are not covered by the NHI. But, as mentioned, these still need to be defined. Once you are a registered member of the NHI fund, you cannot seek specialist services directly without consulting an accredited NHI Service Provider, who will refer you to a specialist if the required service is not covered by the Fund.

According to the Project timeline, and rollout, it is expected that full implementation should be completed by 2026, with a dramatic downscale in the number and size of Private medical aid schemes. Given the murky details and failures during the Pilot phase, the target date of 2026 is wishful thinking, as opined by analysts in the Sector.

And that, in a nutshell is what the National Health Insurance scheme is all about.

From A layman’s Perspective

There is no doubt that our (Public) Health system is in a bad state of disrepair. The fact that more than 80% of the population is subjected to it, makes the task of regulation that much more challenging. That less than 20% of the population enjoys quality superior healthcare, one could say, is a travesty of justice. However, dismantling the Private Healthcare system to accommodate the goals of this NHI scheme is definitely not the way to go. And on the face of it, this is exactly the intention. The adverse repercussions that would result from such careless legislation can only be destructive to the system as a whole. The Pilot Phase has highlighted crucial inconsistencies with many unworkable solutions. None of the highlighted issues have satisfactorily been resolved, but the first phases of the plan has already been launched in Provinces like KZN and the Eastern Cape. 

Any layman could see that the natural progression of achieving the goal of universal, quality healthcare for all, is simply to fix what is broken, and then apply legislative changes, in phases, to accomplish that goal; ensuring that all stakeholders are accommodated fairly. There are numerous examples of Global countries with efficient world class Healthcare Systems that can be used to model a system successfully. But contrary to a layman’s opinion, our esteemed leaders in government don’t really see it that way. They prefer the bulldozer approach to fixing shit.