07 October 2009

Declaring war on medical schemes

The Sunday Times know that the ANC has plans to implement a NHI fund. Can we view the paper’s open condemnation of medical schemes as tacit support for government's plan?

The Sunday Times is often criticised for publishing articles with an anti-government slant. While the paper remains brave enough to publish details of political shenanigans, allegations of corruption and evidence of poor service delivery, the assault on the country’s medical schemes industry is dripping with pro-government sentiment.

The Sunday Times – and its readers – know that the African National Congress (ANC) has plans to implement a national health insurance (NHI) fund. Can we view the paper’s open condemnation of medical schemes as tacit support for government’s plan?

"Medical aid crunch hits SA families hard," claim journalists Subashni Naidoo and Rob Rose in the paper’s lead article. They allege that "half of South Africa’s eight million medical aid members are either broke or fast running out of funds to cover day-to-day medical expenses."

The Sunday Times says that 70 % of ‘cheap’ medical aid members, 40% to 50% of 'mid-level' members and 20% of ‘top-end’ members had run out of funds by March of a particular calendar year. This information conflicts slightly with statistics provided by the country’s largest medical scheme, Discovery Health. They say that through 2008 17% of their members ran out of funds by May, with 42% in the predicament by September.

The major complaint
But ranting over the inefficient cover afforded by private medical schemes may soon be a thing of the past. An NHI solution looms, with both government and the Board of Healthcare Funders (BHF) indicating their support for a draft NHI proposal. The draft will be reworked in coming months; but regardless of future changes we expect a full scale implementation of NHI to render medical schemes obsolete, place an unacceptable burden on the country’s taxpayers and possibly destroy the private healthcare sector altogether.

South African citizens who currently benefit from some form of private healthcare won’t be complaining about insufficient benefits in future; but insufficient services.

Medical schemes have been reluctant to comment on ‘leaked’ versions of government’s NHI policy, preferring to adopt a wait-and-see attitude. We expect schemes want to see an official government policy document before entering the fray. But after this week end’s press ambush the medical schemes may want to reconsider their positions. After all, they represent the interests of approximately eight million ordinary South Africans.

Will NHI be the death knell for medical schemes?
From a governance point of view we’re amazed the BHF – which is supposed to represent medical schemes’ interests – can back a proposal that circumvents their industry. According to an article published 1 August 2009 on MoneyWeb, BHF managing director, Humphrey Zokufa, believes the policy is "about creating a social solidarity principle."

Should that be his concern – or should he be batting for the medical schemes his organisation represents? Among the proposals, medical schemes will not be able to offer any benefits supplied by state facilities, medical schemes’ members will have to use state (or state approved) facilities and – wait for it – pay out of pocket for anything government deems as private treatment.

What future will private medical schemes have? Will they simply be administrative nets to assist in channelling member funds to an NHI super-fund? This scenario is administratively inefficient. Why pay to a medical scheme if practically every aspect of your healthcare will be funded from the NHI pool. We find the BHF suggestion that the NHI will provide opportunities for medical schemes to expand their reach as a trifle absurd. Medical schemes’ membership has been stagnant for many years – and if the NHI proposal goes ahead the only likely candidate for a medical scheme will be truly wealthy, someone already in the net.

Speaking at the Hospital Association of SA (Hasa) conference in Durban (held in June 2009) health economist Alex van den Heever dismissed the NHI proposal as a "completely unworkable, unaffordable solution that won’t improve health services despite massive increases in expenditure."

But government says it will proceed with an accelerated NHI implementation regardless of these concerns. At the same conference, Dr Molefi Sefularo, deputy minister of health, said the department’s NHI plans would be subject to scrutiny. "We have noted the concerns of the private sector about the prolonged silence [from the department of health] on NHI and lack of certainty about what is contained in our plans," he said. "It will not be sprung on you by surprise. There will be ample opportunity for debate and contribution."

Is this propaganda or sensation-seeking?
As NHI looms one has to question the timing of the Sunday Times medical schemes exposé. The stories are not new. Complaints about increasing medical costs, shrinking medical schemes benefits and insufficient day-to-day medical expense funds have been on the rise for some time now. And that leads to the question: Is the Sunday Times drumming up support for government’s inevitable healthcare intervention?

(Gareth Stokes, FA News, August 2009)


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