NATIONAL HEALTH INSURANCE: WHAT IS IT?
Since the government announced that they were looking to introduce a national health insurance scheme, there has been a lot of confusion, speculation and panic amongst private healthcare users and providers. So what exactly is National Health Insurance, how is it going to work and what are the cost implications on the taxpayer?
SO WHAT IS NHI?
The Department of Health has described the National Health Insurance (NHI) as a financing system that will ensure that all citizens of South Africa are provided with quality and affordable healthcare based on their health needs, regardless of their employment status and ability to make a direct monetary contribution to the NHI Fund. It is a fund that will pay for healthcare for all South Africans, there will be no fees charged at the health facility because the NHI fund will cover the costs of your care. It is similar to private medical schemes except for 2 differences. The first difference is that the national health insurance will cover every South African regardless of their socio-economic status. The second difference is that the socio-economic status of members of the public will not influence the type of healthcare they receive but it will be influenced by their health conditions. There will be no limited benefits because of the salary you earn or because you are unemployed.
The NHI Fund will be run as a non-profit public entity. It will strengthen the hand of the healthcare consumer and keep the cost of healthcare reasonable while ensuring that healthcare providers receive fair and reasonable rates for their services.
NHI will offer all South Africans access to a defined package of comprehensive health services and will provide as wide a range of services as possible from primary healthcare to specialized tertiary and quaternary levels of care. Patients will not be told that their benefits have run our or be asked to share the costs of treatment unless a member of the public fails to follow the required referral route from GP to specialist.
Treatments such as cosmetic surgery that is not necessary or medically indicated but done as a matter of choice will be excluded along with expensive dental procedures performed for aesthetic purposes and eye care devices such as designer spectacle frames. Any medications not included in the national essential drug list will also be excluded.
The NHI benefits will cover preventative, promotive, curative and rehabilitative healthcare services and will place emphasis on the prevention of diseases such as HIV, AIDS, TB and similar conditions while promoting health amongst South Africans.
HOW WILL THE NHI WORK?
Individuals who are already insured by medical aid providers will be free to continue their medical scheme membership, but the will not be able to opt out from making contributions to the NHI Fund. Public Medical Aid such as the GEMS Medical Scheme will no longer exist but members will be accommodated within NHI and the government will no longer provide subsidies for medical scheme contributions. Fewer people will continue with private medical scheme contributions, as it will be unnecessary to belong to both NHI and a private medical aid unless they intend to have cosmetic and/or non-essential surgeries.
NHI will provide finance for healthcare. It will however not involve itself in the management of hospitals, clinics or practices of GP’s, dentists, specialists or any other health professionals. NHI will enter into contracts with private and public hospitals, including private health practitioners and public clinics in order to provide services. A patient will be able to choose any NHI-contracted provider near them for their regular health needs. Public hospitals and clinics will be made to upgrade their facilities and healthcare facilities will only be part of the NHI system if they meet certain standards of care and are accredited by an independent body called the Office of Health Standard Compliance.
The National Health Act is being amended to provide for the setting up of the Office of Health Standards Compliance. The aim is to ensure that members of the public receive quality healthcare from all healthcare providers. The OHSC will report to and advise the minister of health on a regular basis and will guide and inspect health facilities and only certify those that comply with the required standards. An OHSC certificate issued to a healthcare facility will ensure that standards of hygiene, safety, and respect for patients are being met.
The NHI Fund will have strong buying power which will enable it to purchase health services at a reasonable rate. The rate at which the NHI Fund will pay healthcare providers will be higher than the present cost of public health services but lower than most rates in the private sector and the NHI Funds method of payment will encourage healthcare providers to operate efficiently and provide effective care. The NHI Fund will be run as a non-profit organization and will keep administrative costs low.
SOUNDS GREAT BUT WHO IS GOING TO PAY FOR ALL OF THIS?
The NHI will get a large amount of their funding from general taxes. Therefore, every South African will make a contribution to the fund because we all pay taxes in one form or another. People with low income will not make any direct payment to the NHI Fund. Every person earning above a set amount will be required to contribute by law. Monthly contributions made by the employees to the fund, in almost all cases will be lower than medical aid tariffs and the direct NHI payment will be larger for high income earners. Employers will assist the NHI Fund by ensuring that their workers contributions are collected and submitted in a manner similar to UIF contributions. Employers will match their employee’s contributions to NHI.
South Africa already spends a high amount on healthcare. If private and government spending are combined it amounts to more than R200 billion a year. A substantial part of this is spent on private care for only 16% of the population and private care is, at present, often needlessly expensive. The NHI Fund income will amount to at least as much as present healthcare spending. But it is possible that government will be required to further boost this amount.
The NHI will be able to count on all present government funding for public healthcare and all the money government spends on tax subsidies for medical scheme members and contributions from people who are presently members of medical schemes and lastly contributions from those who earn well but have avoided joining medical schemes.
Should you require any further information on NHI then please visit www.health.gov.za or call (012) 395 8000 to find out when the NHI town hall meeting will be held in your community.