What’s up with the National Health Insurance, South Africa?

So what is National Health Insurance? (NHI)

You've probably heard a lot about the National Health Insurance (NHI) recently. The headlines, the debates - it's a hot topic, and for good reason. The NHI affects every South African, yet there's still plenty of confusion about what it means for you, the economy, and the future of private medical aids and the effect it could have needing private medical aid.

Uncertainty around NHI

A big part of the uncertainty is that many of the practical details haven't been finalised. But some facts are now clearer, especially the legal status of the NHI. Here's a breakdown of where things currently stand, what the NHI aims to do, and the key concerns people have raised.

The NHI is now law - but it's not yet in effect

The NHI Act was approved by the Portfolio Committee on Health in May 2023 and passed by Parliament in June 2023. It was then sent to the National Council of Provinces (NCOP) for concurrence.

Timeline of the NHI Bill

On 6 December 2023, the NCOP passed the NHI Bill and submitted it to the President for assent. This was done without any substantial amendments to the Bill, despite significant concerns raised by various stakeholders during the parliamentary process regarding its financial, constitutional, and operational viability.

The NHI comes into South African law

On 15 May 2024, President Cyril Ramaphosa signed the Bill into law in Pretoria. It was gazetted the following day as the NHI Act. However, no effective date has been announced yet, which means the Act is not yet operational.

Who will benefit from the NHI?

The NHI is designed to be a public health funding system that provides access to quality healthcare for all South Africans and legal long-term residents. At its core, the NHI aims to reduce inequality in healthcare access, especially for those who currently can't afford private care or don't receive adequate public health services.

Why is the NHI so controversial?

While the idea of universal healthcare is widely supported in principle, the proposed structure of the NHI has sparked serious debate.

Here are some of the main concerns:

• Flawed pilot projects: Between 2012 and 2017, pilot projects across 11 districts cost more than R4 billion. However, the data collected was limited, making it hard to assess the pilots' success. For example, a project to digitise patient records failed in rural areas due to poor connectivity, lack of equipment, and IT skills shortages.

• Governance concerns: The NHI will function as a state-owned enterprise (SOE), which raises red flags given the poor track record of other SOEs like Eskom and SAA. Concerns about corruption, inefficiency, and political interference are widespread.

• Too much power in one office: The Minister of Health will have sole discretion over key appointments and decisions related to the NHI Fund. Critics argue this centralised control could lead to mismanagement or abuse of power.

• Unclear costs: The Department of Health has estimated the NHI could cost R259 billion to implement, but independent estimates (like those from the Institute of Race Relations) put the figure closer to R450 billion. Treasury has yet to finalise its own costing. Without a clear definition of what services the NHI will cover, accurate budgeting remains impossible.

• Uncertainty for private medical aids: The NHI Bill states that medical aids may only offer cover for services not included in the NHI. But since the NHI's service package hasn't been defined, it's unclear how this will affect the role of private medical schemes in future. Discovery Health and others have stated they expect to continue playing a major role in the healthcare system.

Need help with choosing medical aid? View all of Hippo's medical insurance partners to make the best choice for you.

Are there any advantages to the NHI?

Yes - at least in theory. If implemented effectively, the NHI could be one of South Africa's most impactful social reforms. Universal access to healthcare could reduce inequality, improve national health outcomes, and strengthen the workforce, contributing to economic growth.

Many countries with successful national health systems have seen improvements in productivity, social inclusion, and job creation while also advancing sustainable development goals.

Should you still have private medical aid?

Yes. Despite the NHI being signed into law, private healthcare remains essential, especially since the Act has no implementation timeline and major details are still unclear. Both government and private medical schemes have indicated that private cover will continue to play a role alongside the NHI.

If you're reconsidering your options, use our Medical Aid Comparison Tool to explore plans that suit your needs.

You can compare medical aid, medical insurance and medical gap cover quotes in minutes - quick, simple, and obligation-free.