Zwelinzima Vavi's Keynote address to the Emerging Market Healthcare gala dinner, Cape Town, November 19 2011:

Thank you very much for inviting me to speak at this prestigious gathering of medical professionals and stakeholders from the medical schemes and pharmaceutical industry. I bring greetings from COSATU's more than two million members.

The topic of today's open day - Implementation scenarios for the medical practitioner in the context of National Health Insurance - could not be more important, not just for your members but for every South African and future generations.

We stand on the brink of a revolution in our healthcare system, with the implementation of the first phase of National Health Insurance (NHI) in April 2012, in which healthcare professionals have a central role to play.

I begin with three short quotes on the subject of healthcare.

From Section 27 of the South African constitution:

"(1) Everyone has the right to have access to health care services, including reproductive health care;
 (2) The state must take reasonable legislative and other measures, within its available resources, to achieve the progressive realisation of each of these rights.
 (3) No one may be refused emergency medical treatment."

From The South African Department of Health:

"Healthcare is a human right... This right should not depend on how rich we are or where we happen to live. The right to obtain healthcare is written into our Constitution."

And from your very own Mission Statement:

"Emerging Market Healthcare is in the business of providing affordable and good quality healthcare service delivery and managed healthcare solutions for patients and providers from the emerging market."

These quotes tell me that we all share the view - that healthcare is not a commodity to be bought and sold, but a basic human right.

No-one chooses to be sick; it is something that we all experience, rich and poor alike. Every person should therefore have the right to the best possible healthcare and it is the responsibility of the state to deliver a system that covers all people, regardless of class or status or what you can afford to pay.

That is certainly not the reality today. As the Department of Health says, "Large numbers of our people continue to die prematurely and to suffer unnecessarily from poor health. Treatable conditions are not being treated on time and preventable diseases are not being prevented.

"This is in spite of the fact that government has tried its utmost since 1994 to ensure that everyone in this country has equitable access to necessary healthcare services. There are still serious challenges mainly caused by a skewed healthcare financing system.

"Without National Health Insurance, the burden of disease in the country will not be reduced because the majority of the population - and the section suffering the greatest ill health - will not access good quality healthcare."

Seventeen years into democracy, the South African health care system is still flawed by the imbalances of the past. It was designed to service the minority at the expense of the majority, which has led to an unequal, costly, wasteful and unsustainable two-tier system, consisting of:

A public health service which treats health as a social need, yet is starved of adequate funding and resources. Less than 40% of total health care resources are in this sector, yet it serves 85% of the population, the majority of whom are black and poor.

An expanding private sector, which treats healthcare as a market-driven private business. It accounts for more than 60% of the total healthcare resources, yet it serves a minority of the population, the majority of whom are white and wealthy.

Medical schemes and private providers compete not so much by increasing quality and lowering costs, but by avoiding unprofitable patients and shifting costs back to patients or to the under-resourced public health system.

It is a racially-skewed and class-biased health system - resulting in far too few health professionals and other resources being located in the public service and an over-supply in the private service. Infrastructure development overwhelmingly favours the wealthier areas - leaving the working class and rural areas with depleted and in some cases negligible resources.

Salaries and benefits for the health professionals in the public service are poor, notwithstanding efforts currently underway to correct this. Incentives for health professionals to move into poorer areas are almost non-existent, aggravated by the added problem of a poor living infrastructure which makes the prospect of moving into these areas with one's family all the more difficult.

There is also a disjuncture been curative and preventative healthcare, with the latter enjoying far too little priority.

All these problems were made worse by the reduction of government investment in all social services between 1996 and 2001 which led to the further deterioration of much of the health service infrastructure.

This legacy of apartheid not only damaged the health sector itself, but had a wider impact on the quality of life for the majority of South Africans, which, despite many achievements in our healthcare system, continues to this day.

The health profile of the population has deteriorated. Although we rank 79th globally in terms of GDP per capita, we rank 178th in terms of life expectancy, 130th in terms of infant mortality, and 119th in terms of doctors per 1000 people. The life expectancy of South Africans dropped from 62 years in 1992 to 50 years in 2006.

Mortality and morbidity rates are unacceptably high; preventable communicable diseases are common, and diseases associated with extreme poverty still occur. The HIV/AIDS epidemic has become the most formidable health challenge, with rates of infection among the highest in the world. At the same time, a wealthy minority suffer from lifestyle-related diseases more typical of developed countries.

If we are all agreed that health is the basic human right, how can we build a system that embodies this principle? The answer for COSATU and the government is the NHI, which, according to the ANC Policy Statement of 27 July 2009:

• Will expand health coverage to all South Africans... There will be no financial barrier to access health care. All South Africans will be equally covered to access comprehensive and quality health care. Health services covered by NHI will be a free at the point use - no upfront payment will be required by the doctor or hospital.
• Will provide comprehensive coverage of health services. South Africans will be entitled to a comprehensive range of health benefits, including primary care, inpatient and outpatient care, dental, prescription drugs and supplies. The services will be provided on a uniform basis at all health facilities.

However, there is a long way to go to turn these excellent plans into reality in the hospitals and clinics. For a start we need to take the following measures if the NHI is to work:

• Filling all currently vacant posts within the public health sector, opening new posts where necessary and ensuring appropriate targets are set for the employment and the production of doctors, nurses, and other health workers.
• Reopening old nursing colleges and establishing additional ones.
• Implementing a comprehensive primary healthcare framework for proper training and expansion of community care workers.
• Creating a clear career path and a progressive human resources model, which ensures that adequate and qualitative coverage is provided for the entire population, regardless of geography, race or class.
• Establishing a Nursing Directorate nationally and provincially to drive the implementation of the Nursing Strategy to co-ordinate and manage nursing services.
• Increasing the nurse/people ratio from 4 per 1000 people to 8 per 1000 and the ratio of physicians to 1 per 1000 people.
• Integrating community healthcare workers into the healthcare system and providing them with retraining on accredited courses.
• Task shifting, so that certain responsibilities of General Practitioners are transferred to nurses, to reduce General Practitioners' work overload.
• Ensuring that the management staff of hospitals and clinics are sufficiently experienced and qualified to manage. Relevant training programme should be developed and implemented.
• Encouraging all doctors on induction to do community work, especially in rural and needy areas.

The physical infrastructure must be upgraded and extended, and facilities be adequately equipped and furnished and resources equitably distributed so that funding is proportional to the size of an institution and the population that it serves.

We also need to improve the administration of the health system, by increasing administration staff and improving efficiency, with an IT system for efficient record keeping and information flows, and improving medicine delivery systems.

We must also:

• Review the pay structure, conditions of employment and career development to address the problem of skills flight.
• Reverse the process of casualisation of support staff, outsourcing, public-private partnerships and the use of labour brokers, which do not support decent work and do not facilitate skills development and career development.
• Build the capacity of clinics to successfully deal with health problems as a means to minimise referrals to, and thereby reduce the burden on, hospitals.
• Establish a state pharmaceutical company to ensure the availability of affordable essential medicines.

We should also find ways to strengthen community and worker participation in governance structures.

Those who oppose the NHI, particularly in the medical aid companies, usually point to the high cost of operating it. We should bear in mind however that the current medical aid system covers slightly less than 16% of South Africans. Annual contributions to medical schemes have increased over two times more than inflation since the early 1990s and average contributions have increased from less than R4, 500 per person in 1992 to over R9, 600 in 2008.

Contributions are not only increasing much more rapidly than inflation, but also more rapidly than average incomes in the formal sector. The lowest-income medical scheme members pay out more than twice the share of their income in scheme contributions than the highest-income medical scheme members

Despite increasing contributions, the medical aid schemes have reduced the amount of funds available for each member to use annually on services especially services such as eye-care and dentistry

The financing of NHI should obviously come from two major sources - the extension of payroll deductions from all full-time workers who are presently not on a medical aid scheme, using the SARS threshold, and higher general tax revenues which would require a higher rate for wealthier South Africans than is paid at present.

However the bottom line is that the long-term costs of maintaining the present inequitable two-tier system however far outweigh the costs of the NHI. Our economy and society as a whole will benefit in many objective and subjective ways. In the long-run it is a reform we cannot afford not to make.

However, the NHI will not see the light of day without consistent campaigning for its introduction and effective implementation by every section of society, but particularly your members in the medical professions. I look forward to working closely with you as we advance toward the birth of this historic advance for the people of South Africa.

Issued by COSATU, November 19 2011

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