South Africa’s National Health Insurance Simplified

You've probably heard many National Health Insurance (NHI) debates recently and seen headlines about the Bill; relevant to all South Africans. However, confusion remains concerning its role out, economic effects and its consequences and benefits for all South Africans as well as the role private medical aids will play in this scenario.

The main reason for the confusion is that many of these details haven't yet been decided or confirmed, and the Bill is still being challenged in parliament.

Here is clarity on certain key matters.

Who Benefits from the NHI?

The NHI is a financial scheme that will provide access to quality healthcare for all South Africans and legal long-term residents. As many of our poorest citizens do not have such access, the NHI's objective is to level the playing field so all South Africans benefit from good healthcare.

Why is the NHI so controversial?

There are many reasons why people are skeptical of the NHI, but here are the main concerns:

• Pilot projects were flawed: Between 2012 and 2017, various pilot projects were rolled out across 11 districts, costing more than R4bn. Due to a lack of data gathered from these test cases, assessors couldn't fully determine whether the projects were successful or not. However certain serious flaws emerged, for example, a project concerning the registration of patient information on a computer system failed in rural areas due to connectivity issues, hardware problems, and a lack of people skilled in IT.
  
  
• The NHI will be a state-owned enterprise (SOE): Our country's history of managing SOEs isn't encouraging, for example Eskom and South African Airways. This sparks concerns regarding corruption and mismanagement of the NHI.
  
  
• The minister of health has too much power: The governance of the NHI and appointment of members of the funding board will be solely determined by the Minister of Health. This could leave the system open to corruption and mismanagement should the minister not have the required skills to manage the scheme.
  
  
• We don't know if we can afford it: Although the Health Department estimated it will cost R259bn to implement, the Institute of Race Relations (an opposer of the NHI) believes it will cost closer to R450bn, and the National Treasury is still working on its estimation. As the nature of care to be offered by the NHI hasn't yet been established, costs and budgets cannot be accurately determined.
  
  
• We don't know what will happen to medical aids: According to the Bill, medical aids will only offer complementary cover for procedures not covered by the NHI, but as it hasn't been concluded what will be covered by the NHI, the future role of medical aids remain uncertain. Discovery Medical Scheme believes that Discovery Health and other medical aids will continue to play a crucial role in local healthcare.

Are there any Advantages to the NHI?

In principle, the NHI is a good one as sound healthcare is a human right, deserved by everyone. If the NHI succeeds it would be one of our countries' greatest achievements and would boost the economy, for example, by providing a healthier workforce. Countries which have implemented successful national health systems reap numerous benefits, including job creation, meeting sustainable development goals, and driving social inclusion.

When and how will the NHI roll out?

Plans are to roll out the NHI schedule by 2026 over the following five stages:

September 2019 – March 2021: The NHI Fund is to be established and healthcare centres, like hospitals, will be NHI-accredited to be able to offer services paid for by the fund.

May 2020 – March 2021: The NHI will obtain funding from the national budget to expand and fund its service. Finer details need to be determined, for example, how healthcare providers will be paid.

April 2021 – March 2022: Some existing grants to the health department will be moved into the NHI, such as the TB grant.

April 2022: Gradually, some or all funds used in the current healthcare budget will be shifted to the NHI fund.

May 2022 onwards: During the final phase, the basic structures of the NHI will be in place. During this phase there will be a service expansion and new taxation options established for the fund. We will continue providing updates if and when they become available.

You may be asking yourself whether it is still worth having a private medical aid? As the government and medical schemes have stated that they will continue to play a role in the NHI, private medical funding is wise. We've made it easy for you to find the cover that will suit you and your family best – just use our medical aid comparison tool and get a range of quotes in minutes.

Sources: Spotlight; Business Tech; Department of Health

Prices quoted are correct at the time of publishing this article. The information in this article is provided for informational purposes only and should not be construed as financial, legal, or medical advice.