IN 1995, buoyed by an overdeveloped sense of
boundless possibilities, SA embarked on much needed reform of our
racially segregated, unequal education system. The African National
Congress (ANC) settled on a first-class Rolls-Royce curriculum that was
called outcomes-based education, grafted on to third-class
infrastructure and — save for those at the nation’s elite public and
private schools — a desperately underprepared teacher corps. The result
was as predictable as it was tragic: today our education rankings are
among the worst in the world.
With National Health Insurance
(NHI), we are about to do exactly the same. This time, we do so with our
eyes wide open amid unprecedented economic and political gloom,
repeating history not once, as a famous 19th-century political economist
once said, but twice: the first time as tragedy, the second time as
farce. Henry Kissinger once remarked that learning from history is
everything, and the principal lesson of the past 20 years of democracy
is to bite off only as much as you can chew, or there may be nothing to
chew on at all.
Our health system is in need of surgery. The government spends the second-largest chunk of the largest national budget of any African state on public sector hospitals and clinics, and yet we have chronically underperforming hospitals in many parts of our country, especially the Free State, Eastern Cape, KwaZulu-Natal, Limpopo, Mpumalanga and North West, where graft, corruption and incompetence are widespread.
However, our nation’s leadership across political parties and social sectors has an inescapable constitutional duty and an ethical obligation to provide all of our citizens and legal residents with "access to health-care services, including reproductive healthcare". The Bill of Rights (section 27) entreats the state to "take reasonable legislative and other measures, within its available resources, to achieve the progressive realisation of these rights".
An analysis of the proposals contained in the recently released white paper on a national health system for SA presents some intractable problems that must be solved for the initiative to have any credibility:
• It will require a monumental amount of money to run and will be the second-largest fiscal risk, after nuclear energy, the nation faces. According to the White Paper, an additional R71.9bn taken at 2010 prices will be required by 2025-26. To fund it will require additional taxes in conditions where citizens are already groaning under the strain of low growth, unstoppable large-scale plundering of state resources and assets, a growing and unsustainable debt to gross domestic product ratio and uncertain fiscal management as we hover perilously above junk status ratings.
• NHI centralises and concentrates decision-making powers in structures and individuals who are remote from the day-to-day, practical delivery of health services. A highly centralised version of the UK’s National Health Service, but without the infrastructure and human resource depth to match, NHI will be an entity that will collect and distribute vast sums of money, creating opportunities for corruption and poor governance, as the state’s repeatedly demonstrated inability to run state-owned enterprises such as South African Airways shows.
• By potentially forcing the amalgamation of existing medical aid schemes (where the members of medical aid schemes do not agree to do so), appointing pliant trustees who owe their allegiance to the state into positions in which they are able to control medical scheme money, increasing the percentage of funds that must be kept in reserve by schemes, prohibiting some state services from using private medical care and introducing a model that removes the tax breaks for contributions, the government will give the health minister extraordinary powers and create unprecedented opportunity for plundering.
• To make the system work will require hospitals, clinics, medical doctors, nurses, health professionals and related services that we do not have and cannot get quickly. Currently, private medical care caters for millions of members and their dependants, and the government will be tempted to simply expropriate the infrastructure and skills to cope with the additional load and the public outcry when expectations go unmet. In the world of health, it is one thing to build infrastructure, quite another to create and plan an adequate pipeline of doctors, nurses and other health professionals.
This is not the occasion to walk away from National Health Insurance, but to engage with it. There must be an alternative way of tackling the problem. The National Health Act provides a statutory framework for a district health system and there are 52 spread across the country. Many are in a state of dysfunction, as evinced by the many poor outcomes in the latest District Health Barometer published by the Health Systems Trust. This has greatly impaired the delivery of primary healthcare, the bedrock component of universal health coverage. It follows that we should look into investing in the district health system to achieve universal health coverage by:
• Progressively migrating purchasing of health and related services to districts, with each serving as a cost centre with appropriate autonomy, balanced by a strict framework of accountability such as zero tolerance for adverse audit opinions. Purchasing could be from the private, public or nongovernmental sector, based on relevant evidence that spending is cost-effective and, ideally, driven by activity-based budgeting. Appropriate capitation models (one price for all services) with pricing set by diagnosis-related groups should be considered, rather than fee-for-service provider payment (multiple payment for many services, the total spend not known in advance) that would make cost-containment difficult; and
• Working to persuade provinces to allocate some of their funding (as per the equitable share) to a reformed and upgraded district health system. In the light of the provisions of the Constitution and the Division of Revenue Act, it would be impossible to compel provincial governments to use their allocation in this manner. But the Treasury could draw up guidelines for the amount to be allocated to each district within a province, using formulae that take into account disease prevalence, service utilisation and net population. A conditional grant could be established for district health-care contingencies. This would provide for funding in special circumstances (such as for the purchase of additional high-care beds or theatre time in private facilities when public services are overwhelmed). The grant would be disbursed case by case, using an appropriate needs assessment.
For this to work requires a commitment to primary healthcare and investment in the quality of district health level management training. Devolving more responsibility, accompanied by more robust accountability systems, to the 52 health districts and hospital CEOs could provide more nimble and cost-effective management.
• Dr James is the Democratic Alliance shadow health minister
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| Health clinic |
Our health system is in need of surgery. The government spends the second-largest chunk of the largest national budget of any African state on public sector hospitals and clinics, and yet we have chronically underperforming hospitals in many parts of our country, especially the Free State, Eastern Cape, KwaZulu-Natal, Limpopo, Mpumalanga and North West, where graft, corruption and incompetence are widespread.
However, our nation’s leadership across political parties and social sectors has an inescapable constitutional duty and an ethical obligation to provide all of our citizens and legal residents with "access to health-care services, including reproductive healthcare". The Bill of Rights (section 27) entreats the state to "take reasonable legislative and other measures, within its available resources, to achieve the progressive realisation of these rights".
An analysis of the proposals contained in the recently released white paper on a national health system for SA presents some intractable problems that must be solved for the initiative to have any credibility:
• It will require a monumental amount of money to run and will be the second-largest fiscal risk, after nuclear energy, the nation faces. According to the White Paper, an additional R71.9bn taken at 2010 prices will be required by 2025-26. To fund it will require additional taxes in conditions where citizens are already groaning under the strain of low growth, unstoppable large-scale plundering of state resources and assets, a growing and unsustainable debt to gross domestic product ratio and uncertain fiscal management as we hover perilously above junk status ratings.
• NHI centralises and concentrates decision-making powers in structures and individuals who are remote from the day-to-day, practical delivery of health services. A highly centralised version of the UK’s National Health Service, but without the infrastructure and human resource depth to match, NHI will be an entity that will collect and distribute vast sums of money, creating opportunities for corruption and poor governance, as the state’s repeatedly demonstrated inability to run state-owned enterprises such as South African Airways shows.
• By potentially forcing the amalgamation of existing medical aid schemes (where the members of medical aid schemes do not agree to do so), appointing pliant trustees who owe their allegiance to the state into positions in which they are able to control medical scheme money, increasing the percentage of funds that must be kept in reserve by schemes, prohibiting some state services from using private medical care and introducing a model that removes the tax breaks for contributions, the government will give the health minister extraordinary powers and create unprecedented opportunity for plundering.
• To make the system work will require hospitals, clinics, medical doctors, nurses, health professionals and related services that we do not have and cannot get quickly. Currently, private medical care caters for millions of members and their dependants, and the government will be tempted to simply expropriate the infrastructure and skills to cope with the additional load and the public outcry when expectations go unmet. In the world of health, it is one thing to build infrastructure, quite another to create and plan an adequate pipeline of doctors, nurses and other health professionals.
This is not the occasion to walk away from National Health Insurance, but to engage with it. There must be an alternative way of tackling the problem. The National Health Act provides a statutory framework for a district health system and there are 52 spread across the country. Many are in a state of dysfunction, as evinced by the many poor outcomes in the latest District Health Barometer published by the Health Systems Trust. This has greatly impaired the delivery of primary healthcare, the bedrock component of universal health coverage. It follows that we should look into investing in the district health system to achieve universal health coverage by:
• Progressively migrating purchasing of health and related services to districts, with each serving as a cost centre with appropriate autonomy, balanced by a strict framework of accountability such as zero tolerance for adverse audit opinions. Purchasing could be from the private, public or nongovernmental sector, based on relevant evidence that spending is cost-effective and, ideally, driven by activity-based budgeting. Appropriate capitation models (one price for all services) with pricing set by diagnosis-related groups should be considered, rather than fee-for-service provider payment (multiple payment for many services, the total spend not known in advance) that would make cost-containment difficult; and
• Working to persuade provinces to allocate some of their funding (as per the equitable share) to a reformed and upgraded district health system. In the light of the provisions of the Constitution and the Division of Revenue Act, it would be impossible to compel provincial governments to use their allocation in this manner. But the Treasury could draw up guidelines for the amount to be allocated to each district within a province, using formulae that take into account disease prevalence, service utilisation and net population. A conditional grant could be established for district health-care contingencies. This would provide for funding in special circumstances (such as for the purchase of additional high-care beds or theatre time in private facilities when public services are overwhelmed). The grant would be disbursed case by case, using an appropriate needs assessment.
For this to work requires a commitment to primary healthcare and investment in the quality of district health level management training. Devolving more responsibility, accompanied by more robust accountability systems, to the 52 health districts and hospital CEOs could provide more nimble and cost-effective management.
• Dr James is the Democratic Alliance shadow health minister
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