Competition Commission report shows Health Department’s gross negligence in protecting people from crippling healthcare costs 

30 September 2019

The Democratic Alliance (DA) welcomes the release of the Competition Commission’s Health Market Inquiry report. This inquiry has been the first of its kind in democratic South Africa, and provides critical insight into the private healthcare industry and some of the problematic issues which have surfaced over the years.

Most importantly, this report demonstrates clearly how the National Department of Health (NDoH) is guilty of gross negligence in exercising oversight of the private health industry and protecting South Africans from the rising cost of medical care, over-servicing and anti-competitive behavior which has led to people being vulnerable to exploitation.

The reality is that the NDoH has had the legislative mandate to be the custodian of healthcare for all South Africans whether they rely on the public or private healthcare. However, they have over the the past 25 years, failed to do so.

The health market inquiry’s damning findings into the dereliction of duty by the Department can be best summarized in the following:

"We have found there has been inadequate stewardship of the private sector with failures that include the Department of Health not using existing legislated powers to manage the private healthcare market, failing to ensure regular reviews as required by law, and failing to hold regulators sufficiently accountable. As a consequence, the private sector is neither efficient nor competitive."

In addition, the report also highlights that there has been absolutely no oversight of the private healthcare industry to ensure quality healthcare for South Africans. For too long, people have been lambs to the slaughter while government has continuously failed to conduct its crucial function. This is captured under the following finding:

“Additionally, facilities operate without any scrutiny of the quality of their services and the clinical outcomes that they deliver because there are no standardised publicly shared measures of quality and healthcare outcomes to compare one against the other. It is impossible for patients, funders or practitioners to exercise choice based on value (quality and price).”

Of greater concern is the department’s belief that the National Health Insurance Bill (NHI) will be the silver bullet of systemic failures over decades.

This Bill, as it stands, does not provide for the review of the health system in its entirety, it simply advocates for a deeply problematic funding model. The Bill makes provision for a central healthcare fund which will be yet another state-owned enterprise. This will do nothing to improve quality of healthcare in both the public and private health industries. Instead it will make this fund vulnerable to mass-scale corruption, over-centralization of healthcare and potential collusion of big business and big government.

The ANC government is nothing if not consistent. Their failures in government are often masked by their scapegoating of other factors. This scarecrow tactic is then used to introduce and justify deeply flawed pieces of legislation like the NHI instead of confronting the real issues.

This is why the DA has proposed an alternative to NHI that will effectively roll out universal healthcare without destroying the economy; creating an additional tax burden and neglecting the issue of quality healthcare. The Competition Commission echos the DA’s long-held view around competitiveness in the healthcare industry which will inevitably lead to better health outcomes and lowered costs.

Similarly to the DA’s Sizani Universal Healthcare plan, the commission recommends “the introduction of a single, comprehensive, standardised base benefit option, which must be offered by all schemes. It will enable consumers to compare products, reward those funders which are able to innovate to offer lower prices and/or higher quality, and, thereby, both discipline and reward the market."

What is clear is that so much is at stake with our healthcare industry. That is why we need systemic reforms that will provide quality healthcare for all- both in the public and private health industry. The legislation being proposed will do nothing to fix what has been broken. The DA will continue to mount its opposition against the NHI and propose workable and effective reforms and solutions.

Issued by Siviwe Gwarube, DA Shadow Minister of Health, 30 September 2019