David Sanders and Louis Reynolds: The Cape Times, 20 Sep

THE advent of the National Health Insurance (NHI) scheme opens up a political space to campaign for a health service that will best address South Africa's health crisis and reduce the extreme inequities between poor and rich, rural and urban, and public sector and private health service users. Campaigning is necessary to raise awareness about the problems in our health system and the best ways to address them, and to disseminate information about the most instructive examples globally of health system transformation that have resulted in impressive advances in health and substantial reductions in health inequalities. Such a campaign must counter powerful groups with vested interests who portray public systems as inefficient and second-best, and see the NHI as an opportunity to preserve a private health system that is innately inequitable because of the need to profit from disease.

SOME ears pricked up when CEO of MMI, Nicolaas Kruger, recently said National Health Insurance was a positive step forward. Surely a move to a centrally government controlled structure would be bad for the private sector? But Kruger's comments follow a statement in August by Discovery that NHI could actually aid the health system, rather than hinder it.

THE controversial business of stem cell banking has come under the spotlight again with the opening of a new storage and processing laboratory in Cape Town. There are now two storage facilities in the country. Cryo-Save, which operates in South Africa but stores stem cells in Belgium, and Lazaron, the first stem cell bank in the country, entered into a joint venture to open the laboratory in Cape Town. Netcells Cryogenics operates a laboratory in Midrand, north of Johannesburg. At the new bank, clients can store stem cells - derived from umbilical cord blood and tissue - locally or in Belgium, where Cryo-Save has a facility. Stem cells are currently used in the treatment of several blood-related diseases such as leukaemia. Cryo-Save CEO Arnoud van Tulder said clinical trials using stem cells in the treatment of diseases such as diabetes and cerebral palsy were under way. Terence Gregory, CEO of John Daniel Holdings, of which Lazaron is a subsidiary, said that although the technology was fairly new, the practice of stem cell banking was growing in South Africa. But Professor Nicolas Novitzky, head of the division of haematology at the University of Cape Town and chairman of the South African Stem Cell Transplantation Society, said he did not believe the new facility would benefit society. He said that the two times that locally banked cord blood samples for patients who needed transplantation could have been used, they were of sub-optimal quality and thus not used. Novitzky said South Africa needed a public cord bank that would be available to all, particularly those under-represented in world registries, which were those belonging to the indigenous populations of Africa. A feasibility study for a public bank is being conducted at the University of Pretoria. Professor Michael Pepper, who is overseeing the study, said umbilical cord blood stem cells were becoming an increasingly utilised source of stem cells for bone marrow transplantation. He said these cells, which would otherwise have been discarded with the placenta after birth, had become a major focus of stem cell research in the last few years. He added that South Africa was operating in a "regulatory vacuum" because legislation on stem cell storage, research and use was yet to be finalised.

Nashira Davids: The Times, 15 September 2011

FAST-food companies will soon be forbidden from marketing their "unhealthy" products on TV during children's programmes. Free toys handed out with fast-food meals as part of a "kiddies' package" might also be prohibited as part of the Department of Health's plans to regulate the "junk food industry". Speaking at a summit on non-communicable diseases in Johannesburg, Health Minister Aaron Motsoaledi announced that he plans to target marketing campaigns that he claims are making children fat. He said children were bombarded with adverts to eat potato chips, fizzy drinks, sweets and junk food, and asked whether it would be possible to "make fruit and vegetables cheaper" and "junk food more expensive". About 23 percent of South African children are classified as obese, which Motsoaledi said has disastrous long-term effects on the health of the nation and makes the "cost of chronic care quite enormous". Overweight children have a higher risk of diabetes, high blood pressure and heart attacks later in life. Motsoaledi warned that companies that could not make substantial profits in regulated markets would turn to places like South Africa to make profits. He said these people selling this junk food were going to find their way into the African market, which was their dumping ground. "Bad" trans-fatty acids have already been regulated. Alcohol advertising faces tighter regulation and salt-content regulations are at the top of the department's list. White South Africans consume an average of 9.8g of salt a day and black South Africans consume 7.8g a day, Motsoaledi said. The recommended daily consumption of salt is between 4g and 6g. Following his May announcement that the salt content of bread would be regulated, five more food types have been added to the list in an attempt to reduce heart disease. Professor Melvyn Freeman, the department's manager for non-communicable diseases, said that, after Motsoaledi's announcement, the bread industry had asked the department why it should we be targeted. Gravies and spices, brine chicken, cereals, margarine and salty snacks will have strict salt-content regulation. Though other foods, such as soya sauce, have a very high salt content, Freeman said that national consumption of soya sauce was low and it has been left off the list. It is estimated that 6 500 deaths a year can be prevented by reducing the salt content of bread alone. Regulating the salt content of bread and of other products will be phased in over five to 10 years because the department was "worried that people will stop eating products" if the salt content was changed suddenly. Each year, maximum salt contents will be slightly reduced.

Harriet McLea: The Times, 14 September 2011

METROPOLITAN Health, the health division of MMI Holdings Ltd, has been reappointed as administrator of the Government Employees' Medical Scheme. The contracts for the administration of Member and Claims Services and performing Clearing House services were awarded after an extensive and transparent tender process. The new term takes effect on 1 January 2012. Nick Rudston, Managing Director of the administration business of Metropolitan Health, welcomed the appointment, which he said would provide significant opportunities for job creation as the scheme continues to grow. He said this meant that GEMS members would continue to benefit from Metropolitan's proven track record and the world-class administration and cost-effective managed care solutions. GEMS was established with the aim of providing all public service employees with equitable access to affordable and comprehensive healthcare benefits. It is the fastest growing medical scheme in South Africa, with a membership of more than 580,000 families to date. The tender process for the full range of medical scheme administration services started in June this year and was overseen by independent auditing firm Deloitte. All accredited medical scheme administrators were afforded the opportunity to submit bids for the administration contract, based on an extensive request for proposals from the GEMS Board of Trustees.

BusinessLIVE, 14 September 2011

THE government might raise value-added tax to fund its National Health Insurance Scheme. The Treasury's chief director of economic tax analysis and tax policy, Cecil Morden, said at the annual meeting of the Government Employees' Medical Scheme last week that "a higher VAT rate could be justified on efficiency grounds". Finance Minister Pravin Gordhan has been tight-lipped about how NHI would be funded. Morden said that South Africa's 14% VAT rate was "relatively low when compared with the worldwide average of 16.4%". Though he warned that it was important to keep "an appropriate balance" between taxes, Morden said that a consumption tax [such as VAT] was less distortionary and had a "relatively broad taxpayer base". He said VAT ensured that those who managed to escape the income tax net paid some tax, and added that VAT did not impact on savings negatively or on the cost of employment. The Treasury has suggested four NHI "funding avenues", including tax, mandatory employer contributions, user charges and public-private partnerships. Morden cited Ghana, which uses VAT to pay for its National Health Insurance scheme. Ghana's Revenue Authority has projected that a 2.5% consumption tax, known as the "NHIS levy" would fund 60% of that country's universal healthcare scheme. But international aid organisation, Oxfam has warned that the Ghanaian model, promoted by the World Bank, is "severely flawed". Oxfam's health policy adviser, Anna Marriott, said it was time for the World Bank to stop promoting an inequitable health insurance system to other developing countries. The Treasury's chief director of communications, Bulelwa Boqwana, said no decision had been made on which funding option or combination of options would be implemented. He said that "no rate increase for any of these options can be announced at this stage." Unions have warned against increasing VAT. Cosatu spokesman Patrick Craven said that VAT was "a very unprogressive tax" and that the rich should be taxed more than the poor. Cosatu would "consistently oppose" an increase in VAT, Craven said. Rhodes University tax professor Matthew Lester said that Morden "seems to be favouring VAT" but any suggestion of raising VAT would cause an uproar by the unions. He suggested that a carbon emissions tax and company tax, though unpopular, would be preferable to increasing VAT, which he described as a "holy cow" of the unions. Company tax, personal income tax and VAT contribute 20%, 34% and 27% of South Africa's tax revenue respectively. The projected costs of the NHI are likely to change. Morden's presentation showed that the Treasury expects an R18.5-billion shortfall in health funding next year.

Harriet McLea: The Times, 12 September 2011

THE call by the Council for Medical Schemes (CMS) in its annual report for price control of the private health sector has raised the hackles of hospitals. Professor William Pick, who chairs the CMS, said in his preface that it was clear that supply-side reform was needed. He referred to rising costs in the healthcare industry, especially in respect of hospitals and specialists. Medical scheme payouts in the year to end-December 2010 included the following: around R31.1bn was paid to hospitals. That was 37 percent of total medical schemes payouts. Private hospitals' portion of that, R30.8bn, rose 10 percent; and. payments to medical specialists formed R18.8bn or 22 percent of total disbursements. This was a rise of 12 percent. Dr Monwabisi Gantsho, CMS registrar and chief executive, said "the only explanation" for the increase in medical schemes' expenditure on hospitals was rising prices. He said these increases were very high and again indicated the urgent need to regulate the tariffs of private hospitals and specialists. Both Mediclinic and the Hospital Association of SA (Hasa) expressed sharp criticism of the remarks by the CMS and questioned the reliability of the report. Hasa chairperson, Dr Nkaki Matlala, said the CMS report contained faulty and unqualified assertions about the reason for medical schemes' rising payouts to hospitals. Mediclinic said despite its attempts to expose the myths regarding private hospital prices through research and statistics, the comments had nevertheless come from the CMS. Private hospitals' tariffs were affected by rises in underlying input costs, such as those of equipment and nurses' salaries, Mediclinic said, adding that hospitals were nevertheless keeping a lid on prices despite high medical inflation. According to Mediclinic, hospital groups' results show growth in hospital admissions, in contrast to the reduction claimed by the CMS, and said this gave rise to concern about the report's reliability. Matlala said the CMS was confusing the issue of rising medical scheme expenditure on hospitals with price. Mediclinic alleges it relates rather to the increase in services rendered because medical scheme members on average stay in hospitals longer. Scheme members have remained in hospital for an average of 3.3 days compared with other patients' ¬3.2 days. Matlala said the CMS's call to control private hospital tariffs was misplaced, adding that the higher expenditure on private hospitals was not because of hospital tariffs.

Nellie Brand-Jonker: Fin24.com, 11 September 2011

Xolile Bhengu: The Financial Mail: 9 September 2011

THE drop in the number of SA medical schemes, from 105 in 2010 to 99 as of January 2011, is a trend that is expected to continue. Monwabisi Gantsho, CEO and registrar of the government regulator, the Council for Medical Schemes (CMS), said the council was not driving or determining the process but it expected more mergers. The 5,7 percent drop was driven by consolidation and involuntary liquidation. Some schemes were not able to maintain the 25 percent solvency ratio, and reach or retain the council's minimum 6 000 required membership base. Discovery Health CEO Jonathan Broomberg said it was the smaller schemes that were more likely to disappear in time. Discovery, as SA's largest scheme, has played a role in swallowing some of the smaller outfits. Broomberg said the medical scheme environment was becoming more complex and schemes needed significant scale and expertise to manage their risks. Gantsho, who believes there are still enough schemes to ensure competitiveness, said there were issues the industry would have to confront. His main concerns include medical scheme governance, given the failings of some boards of trustees to properly manage scheme funds; compliance with the Medical Schemes Act; and cost containment. This is more of a problem because of the absence of a National Health Reference Price List - a discontinued benchmark for tariffs. This has led to prices rocketing in certain areas. The debate about prescribed minimum benefits (PMBs) is also ongoing. The Board of Healthcare Funders is taking the CMS to court this month to argue on the definition of PMBs, which the regulator says must be paid by schemes "in full and at cost". The board believes PMBs have created a situation where service providers can charge what they want. It would like medical schemes to pay scheme rates, rather than service provider rates, for the 270 medical and 25 chronic conditions. Board spokesman Heidi Kruger said government policy was promoting the higher costs. She said the fact the registrar was encouraging this in his stance on PMB payments undermined national health policy that sought to contain costs and make healthcare more affordable and accessible. The stance would have made sense, Kruger said, had it been implemented when the pricing commission was in place and when maximum prices in the industry had been set. Gantsho does not believe PMBs could bankrupt schemes. He said if the NHI were introduced, the number of PMBs could actually increase. He said that until such time as the definition changed, schemes must pay for PMBs as per the Medical Schemes Act requirement. With the increased costs that PMBs bring it may, in the short-term at least, put pressure on some of the less-well-run schemes. More of them could disappear.

Netdoctor.co.uk, 8 September 2011

NEW figures suggest that there are 12 million new cases of cancer worldwide each year. The World Cancer Research Fund (WCRF) believes that about 2.8 million of these cases are linked to poor diet, lack of exercise and obesity. The charity also warns that unless action is taken as a matter of urgency, the number of new cases linked to poor lifestyle will increase dramatically over the next decade. It has urged delegates at the forthcoming UN Summit on Non-Communicable Diseases (NCD) later this month to grasp a "once-in-a-generation opportunity" to prevent a public health disaster. Professor Martin Wiseman, the charity's medical and scientific adviser, said cancer and other lifestyle-related diseases were one of the biggest challenges faced today and the UN Summit later this month was a real turning point. He said that many people were diagnosed with cancers that could have been prevented by leading healthier lifestyles. He added that with millions of lives at risk around the world, the stakes were incredibly high. WCRF scientists recently found that women in the United Kingdom were 17 percent more likely to develop cancer by the age of 75 than their European neighbours. The charity believes the nation's high levels of obesity and alcohol consumption may be exacerbating the problem.

MEDICAL schemes challenging the government regulator of the industry in court on the scope of the set of compulsory benefits may find themselves in an uncomfortable position should they happen to win. Known as prescribed minimum benefits (PMBs), these are a set of conditions that schemes have got to pay for in full, according to the Medical Schemes Act. But the Board of Healthcare Funders, and several schemes individually, have challenged the interpretation of the Medical Schemes Council on a section of the Act which if successful could see a cornerstone of medical scheme members' rights disappear. They may however, in that eventuality, be faced with "thousands more PMBs", according to Dr Monwabisi Gantsho, the registrar of the council. Asked to explain this, he said if a court found against the council and PMBs, the whole NHI (National Health Insurance) plan would have to be brought forward hastily to ensure people could rely on getting the healthcare they needed. He added that there were many more conditions the NHI would have to cover than PMBs. Gantsho implied too, that should the council win, schemes may find themselves in any event faced with more PMBs. The dispute on PMBs has risen in tandem with and related to the rising costs of healthcare in private health. The disputed regulation states PMBs must be paid in full, at cost and cannot be paid from savings accounts in benefits and must be paid from the major risk pool. All emergency procedures fall under the PMB umbrella as well as those conditions specified in the Act and its regulations. In the registrar's report within the Council for Medical Schemes' latest Annual Report, Gantsho stated that the council had submitted draft amendments to PMB regulations to the Health Minister which would soon be published for comment. A code of conduct for schemes in dealing with PMBs had been published - but this, in the case of some, appeared to have been breached. In the section of the report dealing with complaints, issues around PMBs had pride of place at the top of the list of types of complaints the council dealt with from members (1 749 complaints for the year), followed by non-payment of accounts (1 230 complaints). These two accounted for around half the complaints in the year that the council received. Gantsho was less forthcoming, however, about the fate of medical schemes in general in the light of the impending NHI plans. Asked what would happen, he said the green paper had stated that schemes would continue to exist, but they might be in a different form. This was also stated in the council's annual report. He preferred not to be drawn on what form this might take. The council has set up a task team to deal with the issues and has a place on the Health Minister's advisory committee dealing with the NHI. Pressed for more detail, Gantsho pointed again to the green paper, saying top-up schemes, supplementary and complementary services were available among other options internationally and this could be the case in South Africa. He said it was not possible to tell now how it would evolve over time and South Africa was not using the "big bang" approach that had been used, for instance in the UK, to introduce the National Health Service.

Pat Sidley: The Citizen, 7 September 2011