Tamar Kahn: Business Day,

THE government's plans to allow private healthcare players to negotiate fees collectively would put too much power in the hands of medical schemes, according to the Hospital Association of SA (Hasa). The Health Department is set for talks with private hospitals after it published draft legislation last week paving the way for bargaining between private healthcare providers and medical schemes, which pay the bills on behalf of their members. The draft National Health Amendment Bill envisages annual tariff negotiations overseen by a facilitator, with an appeal tribunal to resolve disputes. The proposed laws come as rising private healthcare costs are making medical scheme membership so expensive that a decreasing proportion of the population can afford cover, increasing the burden on the overstretched public sector. Hasa CEO Kurt Worrall-Clare asked what incentive there would be for medical schemes to negotiate if ultimately the decision was made by a third party. Hasa was concerned about powers accorded to the tribunal, questioning on what basis in law a third party had the right to tell a business how to price their products and services. Hasa was also unhappy with the fact the draft laws contained no mechanism for parties to appeal against the tribunal's decisions. As the bill stood, parties would have to turn to the courts if they were not satisfied with the tribunal's findings. Worrall-Clare also questioned whether the bill's provisions for collective bargaining would be permitted by the competition authorities, which have stepped in to stop price-fixing in industry. He criticised the wording of the draft legislation, saying it was vague and lacked detail. He said Hasa had not been consulted on the bill, and had requested a meeting with Health Department officials to seek clarity, adding that it was imperative to understand their thinking before taking a position. The Democratic Alliance (DA) also criticised the bill, saying proposals for centralised price negotiations could lead to prices so low they would put hospitals out of business. Health spokesman Mike Waters said that the DA proposed that greater transparency in pricing be actively pursued, including establishing a mechanism requiring public hospitals to publish certain details on pricing. He said that the Competition Commission must also continue to act firmly against price collusion and uncompetitive practices in the industry. The DA called for subsidies and VAT exemptions for public-private partnerships involving private hospitals. Parties have until May 16 to submit comments on the bill to the Health Department.