Tamar Kahn: Business Day,
Slindile Khanyile: Business Report,

HEALTH Minister Manto Tshabalala-Msimang will present her department's new policy on national health insurance (NHI) to the cabinet tomorrow. The African National Congress (ANC) has been debating NHI for over a decade, but the project received new impetus last year when the party's conference in Polokwane identified it as a priority. The government hopes to resolve the myriad problems facing both the public and private healthcare sectors in SA by introducing a new health system that will provide basic medical care to all citizens, with the rich subsidising the poor and the healthy subsidising the sick. It will be financed by a mixture of government funds and mandatory contributions from employees. Tshabalala-Msimang declined to provide details of the NHI policy, but did indicate that it had yet to be costed. The policy would be made available for public comment once it had been approved by the cabinet, she said. Speaking on the sidelines of the annual Board of Healthcare Funders (BHF) conference, she said NHI was intended to make quality healthcare affordable to more South Africans, and to address rising costs. Addressing delegates she said the private health sector had faced an "uncontrollable" cost spiral since the 1980s and was unsustainable in its current form. The most important cost drivers were private hospitals, specialists and administrative costs, she said. Annual expenditure on private hospitals was R803 per medical scheme beneficiary in 1997, which increased to R2 230 in 2005. Medical scheme contributions too had been increasing from an average of R3 423 per beneficiary in 1998 to R7 807 in 2005 and had become increasingly unaffordable, she said. Tshabalala-Msimang said some of the legislation required to support the implementation of NHI had already been developed, including the Medical Schemes Act, the National Health Act, and price regulation for medicines. Further amendments to support NHI were in the pipeline, most notably changes to the National Health Act that will pave the way for the government to oversee annual tariff negotiations between medical schemes and healthcare providers. Health economist Di McIntyre described to delegates the growing gap between the amount of money spent on patients using the public and private healthcare sectors, one of the reasons why the government is keen to implement NHI. Public spending on health per capita had "flat-lined" in real terms over the past decade, she said, hovering just below R1 000. She said it had just been keeping pace with population growth and inflation, yet the demands had increased dramatically, largely because of AIDS. Private healthcare spending per capita had increased 50%, from about R4 000 to R6 000 between 1998 and 2005, she said. At the same time, growing unemployment and the rising cost of medical scheme membership had reduced the proportion of the population able to afford cover to 14%, from 20% a decade ago. Moremi Nkosi, the director for health insurance in the Health Department, said the scheme could play three roles - as substitute, complementary or supplementary cover - but the details were still being discussed. Nkosi said there were no deadlines yet because the department did not want to rush and make mistakes. Another issue that was still being debated was how the scheme would be funded. Nkosi said another issue that' had to be considered was the responsibility for collecting the funds. He said a single-payer system would mean that the government would be responsible for pooling the funds, while the schemes played a significant role. By contrast, the multipayer system would put the bulk of the job into the private sector's hands.