National Health Insurance: ANC proposals do not address South Africa's public healthcare crisis

Improving access to quality health care in South Africa is essential.  However, the DA believes that the priority in providing quality public health care is not to change the financing mechanism for the public health system, as the ANC believes, but rather in improving the basics of delivery and ensuring that the money that is available is used for its intended purpose. We do not believe that the mooted National Health Insurance (NHI) will adequately address the problems that plague the public health system, as it represents more bureaucracy and more centralisation, and therefore in fact will only worsen the problems that public healthcare faces.

The ANC says that its proposal is premised on the need to afford universal health coverage, and enhance "social solidarity". This is the first slight-of-hand in the argument, because public healthcare in South Africa is already universal -- any citizen and resident of the country may access it. Nobody can be turned away from accessing services at a public health institution and the poor receive free health care. The real problem is of quality. And in the past this has been consistently ignored by the ANC government, particularly in its insistence on using the public health system as a vehicle for its political programmes of cadre deployment and centralisation.

Numerous research studies have been conducted into the state of the public health sector. From these studies, five major points of breakdown in our system are identified again and again. These are:

* Mismanagement of funds
* Centralisation
* Poor management because of inappropriate management appointments
* Poor hospital conditions
* Shortage of skilled healthcare personnel

It is these problems which directly affect the quality and the actual delivery of public healthcare. Our concern is this: at best, the NHI sweeps these problems under the carpet; at worst, it may actually perpetuate them. More problematic still is the fact that research done by the Ministerial Advisory Committee on the NHI seems to have been driven by the need to justify the NHI, rather than to genuinely explore the alternatives, and address the real problems that public healthcare studies have identified.

Flowing from this is the fact that current proposals seem to have been drawn up without a proper analysis of funding models. The ANC's proposed sources of funding for the NHI are a variety of new taxes. As we understand it, funding would be drawn from general taxation, through the imposition of a surcharge on taxable income, pay-roll taxes and/or an increase in value added tax. Though it is difficult to provide a thorough analysis of the nature and ramifications of the still nascent funding proposals until further details are made clear, the ramifications of raising taxes across the board for South Africa's economic health needs to be very carefully considered. An increased tax regime could, for instance, force middle-income earners who had opted to take out medical aid back onto the public system, thus further burdening it unnecessarily. These are the complex economic factors that need to be weighed up, but instead the ANC has put the cart before the horse by leaving economic questions to be solved by the Treasury.

Trevor Manuel recently made the point, while rejecting the argument for mine nationalisation: "There is a little matter called opportunity cost. Money spent on acquiring mines cannot be spent on national health insurance". The same, in fact, goes for national health insurance." And whether the opportunity cost for an NHI is new forms of taxation, or fewer services being delivered elsewhere - in reality, it will almost certainly be a bit of both - then it seems profoundly problematic that the "little matter" of finding the funds is only dealt with, in this case, as an afterthought.

Another concern is the degree of centralisation it entails. The research is clear: further centralisation of funding in the public health sector will slow down service delivery. The Department, we must remember, has a chequered history of paying creditors within reasonable time - as of 15 August 2010, it owed well over R140 million to creditors, of which R54.6 million was more than 30 days overdue. This undermines the notion that the NHI could efficiently centralise the reimbursement of both accredited public and private providers.

Perhaps most significant, however, is the fact that the NHI threatens to compound South Africa's already severe shortage of health professionals. Data from the Health Department at the end of last year showed a 35% year-on-year increase in nurse and doctor vacancies (up from 30,026 vacant positions in 2008, to 40,592 in 2009). Hospersa, in calculating the human resource needs of the NHI, argued that a staggering 80 000 new posts would have to be created. The NHI's proposal to simply import health professionals to meet the shortages ignores the fact that the department currently manages the Foreign Workforce Management Programme (FWMP), responsible for achieving this very goal, extremely badly. It is currently taking up to a year to provide endorsement letters to foreign-qualified nationals, which doctors need to have before they can proceed with the steps required to work in South Africa.

We do support some aspects of the proposals - some, indeed, are contained in DA policy, and others are initiatives we have been calling on the health ministry to put in place in order to rectify the challenges currently faced in the public health sector. We support mandatory contributions towards medical cover for people who are employed, because everybody has a responsibility to take charge of their own health, and because this would help to alleviate the pressure on the public sector. We support the call for increasing managerial autonomy in public health facilities (though we would have suggested this be accompanied by rigorous performance management requirements, and an end to cadre deployment which has seen members of the ruling party get put into key management positions, often without the necessary skills). We also support the setting up of the Office of Standards Compliance (though we must point out that it does not require an NHI to set up an office that is already required by law). Finally, we support the development of a health system strengthening plan and an integrated information system, which would vastly improve the efficiency of public health service delivery without the need to recreate the system.

Statement issued by Mike Waters, MP, Democratic Alliance shadow minister of health, October 4 2010

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