

National Health Insurance in South Africa Health System Reform pre- and post- Polokwane Download full PDF Document In a recent paper published in Australia entitled “South Africa: a 21st century apartheid in health and health care?” Prof Gavin Mooney and Prof Di McIntyre provide a succinct comparison of health reform ideas in South Africa pre- and post-Polokwane (The ANC Policy Conference of December 2007 was held in the city of Polokwane in Limpopo province). Mooney, G. H., & McIntyre, D. E. (2008). South Africa: a 21st century apartheid in health and health care? Med J Aust, 189(11-12), 637-640. URL: http://www.mja.com.au/public/issues/189_11_011208/moo11135_fm.html “Given the massive health challenges facing South Africa, and the limited capacity of the health system to meet these challenges, what are the options for change? Mandatory health insurance has been discussed since the late 1980s, but has never been implemented. This is set to change, with the ANC Policy Conference in December 2007 making a very explicit policy commitment to the “implementation of the National Health Insurance System by further strengthening the public health care system and ensuring adequate provision of funding”. The precise nature of the proposed National Health Insurance is still the subject of discussion.” ... “Proposals in the past have focused on introducing what would in effect be a social health insurance; that is, one that only covered health care for those who contributed. The intention was to regulate medical schemes to move them away from risk-rated contributions, and to introduce both a prescribed minimum-benefit package and a risk-equalisation fund between individual schemes. This would introduce risk cross-subsidies (between healthy and ill South Africans), and ultimately move towards income cross-subsidies through further regulation.” ... “The major drawback of this option is that it could entrench a two-tier system. Although, over time, it is possible that mandatory insurance cover would be extended and differentials between the public and private sectors would diminish, experience in Latin American countries has demonstrated that opposition from powerful stakeholders makes it difficult to move from social health insurance to a universal health care system. Indeed, the major rationale for considering this option was the existence of medical schemes (and private health care providers) as a powerful force in the South African health system. The appropriateness of this reform path was seen as being embedded within South Africa’s historical context.” “The decision at the ANC conference has created the space for a somewhat different vision of change in the South African health system — one that focuses from the outset on achieving universal coverage by promoting income and risk cross-subsidies in the overall health system. The broad vision is to focus energies primarily on rebuilding the public health sector to the point where it once again becomes the provider of choice for the vast majority of South Africans. This would be achieved by reversing the effects of the GEAR policy, and gradually, but substantially, increasing tax funding for health services, as well as introducing a compulsory National Health Insurance contribution for all formal sector employees (those in paid employment). These funds would be pooled to promote access to publicly funded health services that benefit all the population. In this way, all South Africans would be entitled to the benefits of the National Health Insurance, as general tax revenue funding would effectively cover the contributions of those outside of the formal employment sector. “The introduction of an explicit National Health Insurance payroll contribution would have two effects. First, it would create a sense of entitlement to publicly funded health services. Second, it would compel medical-scheme members to seriously consider whether continued medical-scheme membership is worth the additional cost. “The value of this approach is that it would lead to an integrated funding and service provision system, with considerable income and risk cross-subsidies, and this would occur within the shortest possible time. Although the richest individuals may still choose to contribute to medical schemes in addition to their National Health Insurance payments, a visible two-tier system would be diminished, rather than reinforced and entrenched as in the social health insurance option. In addition, by holding the “strings” of the largest health care “purse” (rather than attempting to achieve this only through regulatory means), National Health Insurance is likely to be a much more powerful mechanism for controlling the fees charged by private providers. The extent to which the services of private providers are purchased by the National Health Insurance will depend on the level of public sector service capacity in particular geographical locations, as well as the extent to which private providers are willing to accept the payment rates offered by it.” << Back to NHI Project List	Contact Details: Innovative Medicines SA Val Beaumont P.O. 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National Health Insurance in South Africa
Health System Reform pre- and post- Polokwane

In a recent paper published in Australia entitled “South Africa: a 21st century apartheid in health and health care?” Prof Gavin Mooney and Prof Di McIntyre provide a succinct comparison of health reform ideas in South Africa pre- and post-Polokwane (The ANC Policy Conference of December 2007 was held in the city of Polokwane in Limpopo province).

Mooney, G. H., & McIntyre, D. E. (2008). South Africa: a 21st century apartheid in health and health care? Med J Aust, 189(11-12), 637-640.
URL: http://www.mja.com.au/public/issues/189_11_011208/moo11135_fm.html

“Given the massive health challenges facing South Africa, and the limited capacity of the health system to meet these challenges, what are the options for change? Mandatory health insurance has been discussed since the late 1980s, but has never been implemented. This is set to change, with the ANC Policy Conference in December 2007 making a very explicit policy commitment to the “implementation of the National Health Insurance System by further strengthening the public health care system and ensuring adequate provision of funding”. The precise nature of the proposed National Health Insurance is still the subject of discussion.” ...

“Proposals in the past have focused on introducing what would in effect be a social health insurance; that is, one that only covered health care for those who contributed. The intention was to regulate medical schemes to move them away from risk-rated contributions, and to introduce both a prescribed minimum-benefit package and a risk-equalisation fund between individual schemes. This would introduce risk cross-subsidies (between healthy and ill South Africans), and ultimately move towards income cross-subsidies through further regulation.” ...

“The major drawback of this option is that it could entrench a two-tier system. Although, over time, it is possible that mandatory insurance cover would be extended and differentials between the public and private sectors would diminish, experience in Latin American countries has demonstrated that opposition from powerful stakeholders makes it difficult to move from social health insurance to a universal health care system. Indeed, the major rationale for considering this option was the existence of medical schemes (and private health care providers) as a powerful force in the South African health system. The appropriateness of this reform path was seen as being embedded within South Africa’s historical context.”

“The decision at the ANC conference has created the space for a somewhat different vision of change in the South African health system — one that focuses from the outset on achieving universal coverage by promoting income and risk cross-subsidies in the overall health system. The broad vision is to focus energies primarily on rebuilding the public health sector to the point where it once again becomes the provider of choice for the vast majority of South Africans. This would be achieved by reversing the effects of the GEAR policy, and gradually, but substantially, increasing tax funding for health services, as well as introducing a compulsory National Health Insurance contribution for all formal sector employees (those in paid employment). These funds would be pooled to promote access to publicly funded health services that benefit all the population. In this way, all South Africans would be entitled to the benefits of the National Health Insurance, as general tax revenue funding would effectively cover the contributions of those outside of the formal employment sector.

“The introduction of an explicit National Health Insurance payroll contribution would have two effects. First, it would create a sense of entitlement to publicly funded health services. Second, it would compel medical-scheme members to seriously consider whether continued medical-scheme membership is worth the additional cost.

“The value of this approach is that it would lead to an integrated funding and service provision system, with considerable income and risk cross-subsidies, and this would occur within the shortest possible time. Although the richest individuals may still choose to contribute to medical schemes in addition to their National Health Insurance payments, a visible two-tier system would be diminished, rather than reinforced and entrenched as in the social health insurance option. In addition, by holding the “strings” of the largest health care “purse” (rather than attempting to achieve this only through regulatory means), National Health Insurance is likely to be a much more powerful mechanism for controlling the fees charged by private providers. The extent to which the services of private providers are purchased by the National Health Insurance will depend on the level of public sector service capacity in particular geographical locations, as well as the extent to which private providers are willing to accept the payment rates offered by it.”

<< Back to NHI Project List

Contact Details:

Innovative Medicines SA
Val Beaumont

P.O. Box 2008
Houghton, 2041

Tel: +27 11 880-4644

Fax: +27 11 880-5987

Corporate Social Responsibility Projects of IMSA Member Companies

National Health Insurance in South Africa Health System Reform pre- and post- Polokwane

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National Health Insurance in South Africa
Health System Reform pre- and post- Polokwane