National Health Insurance: A reality sooner than thought

by Aug 14, 2009All Articles

Moneyweb
01 August 2009

Government and the BHF have accepted the draft that will make us pay more tax.
Khosie Thom

The controversial National Health Insurance (NHI) programme is well on its way to becoming reality. This week it received the backing of government and the board  of the Board of Healthcare Funders (BHF), which represents 95% of medical schemes in southern Africa.

Government’s plan to create a NHI policy will cost, already heavily burdened taxpayers, around R100bn for something they might not use. It will prevent medical schemes from offering any benefits that are supplied by state facilities; require medical scheme members to use state hospitals and medical scheme members to pay out of pocket for use of private facilities.

Despite these issues the BHF still supports this policy. But proposes, among others, that:
o    Medical schemes and their administrators collect contributions for NHI benefits from the NHI Agency as opposed to the members, as currently pertains.
o    The prices of the NHI package of benefits be negotiated centrally with providers by the NHI Agency and therefore the latter will effectively be the single purchaser of healthcare services in South Africa as far as the NHI package of benefits is concerned. 
o    Medical schemes continue to collect contributions in respect of top up cover from members.

BHF will take its proposal to members next week and then to government.
Clarence Mini, chairman of the board’s regulatory and policy committee, said, “we think we will be able to play a very meaningful role.” And although the details of how the NHI will work are not yet clear, the board said it had decided it was best to be involved in the process.

Humphrey Zokufa, the BHF’s managing director, seems to agree with the policy as it “is about creating a social solidarity principle”. The basis of the proposal is that the NHI should be flexible but it can only be flexible after individuals have paid the required tax amount.

Zokufa painted the current scenario as follows: at the moment people pay ordinary tax and then pay for their medical aid. This number accounts for 3m people who have dependants and the number increases to 7.5m. The rest of the people in South Africa are not covered in any way and the NHI will make up for this. Whether you use it or not, if you are employed you will have to pay for it. This way everyone will have health insurance.

Mini also said the NHI could provide additional business opportunities for medical schemes to extend their reach beyond the current 7.5m members to the pool of the estimated 49m people living in South Africa.

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