President Cyril Ramaphosa has dismissed claims that the National Health Insurance (NHI) will signal the end of private healthcare.
He explained that the NHI Fund will procure services from accredited public and private service providers for every person in need of health care.
“To the contrary, the NHI aims to use the respective strengths and capabilities of both the private and public health sectors to build a single, quality health system for all,” the President wrote in his weekly newsletter on Monday.
Ramaphosa said South Africa’s private health sector has world-class expertise and is a major source of domestic and foreign investment.
“The NHI will be a lifeline for millions of poor South Africans whose resources will be freed up for other essential needs. It will also alleviate the burden on those who are increasingly paying more in medical aid premiums for increasingly fewer services.”
THE STATE HAS BEEN SUBSIDISING PRIVATE HEALTHCARE
President Cyril Ramaphosa said the training of doctors, nurses and other healthcare personnel who work in both the public and private sectors is subsidised by the State.
The state pays billions of rands annually in subsidies for employees who are members of various public sector medical aid schemes.
“We have said that the challenge in implementing NHI lies not in the lack of funds but in the misallocation of resources that currently favour the private health sector at the expense of public health needs.
There is a misconception that the private health care sector operates and is funded completely independently of government. Taxpayers claim tax rebates for medical aid expenses amounting to approximately R37 billion. This is the money the state should earn in taxes which it foregoes to subsidise private health care.
“We, therefore, have a situation where the state both directly and indirectly helps to fund a private health care sector that serves only a minority of society.” said Ramaphosa
In addition, he said access to private healthcare through medical aids is also costly for users.
“It is said that without the tax rebate private healthcare would not be affordable to the majority of users. Medical aid contributions are increasing faster than inflation. At the same time, benefits are being reduced.”
The President cited the 2016 Healthcare Market Inquiry, which found that private healthcare services and medical scheme coverage are frequently over-used without clear improvements in health outcomes.
“The resources that are spent both by the state and private individuals can, therefore, be more efficiently used to build a single, unitary health care system that serves all.”