The Budget Council — a statutory body composed of the national government and the nine provincial finance MECs — has flagged the complexity of implementing the National Health Insurance (NHI) scheme because of the implications for provincial health departments.
Provinces have concurrent powers with national government over health and receive R150bn from the Treasury to run provincial health services. The NHI proposes an entirely new health-system architecture, which involves a centralised fund and hundreds of contracting units overseen by district management offices, which report to the national government.
The change implies huge restructuring and reform, by far the most ambitious yet attempted by the government.
In a statement after its two-day meeting this week, the council said: “While broadly supporting the objective of universal health care, the Budget Council considered that due to the substantial effect on intergovernmental fiscal relations, any implementation should be done in a phased manner and that provinces should remain engaged with the processes about the bill.”
It also said that “the minister of finance will engage with the minister of health to discuss the implications for provinces.”
The department of health, which published the National Health Insurance Bill two weeks ago, has said that the scheme will be phased in over seven years and will be fully rolled out by 2026. However, there has been little engagement with provinces over the mechanics of its implementation and the enormous implications for the provincial health departments.
In parliament on Thursday, President Cyril Ramaphosa addressed the issue of the NHI during question time. The scheme would be implemented “incrementally and within available resources”, he said.
Responding to the negative reaction that followed the announcement, Ramaphosa said that the aim was to end inequality in access to quality health care.
“About R250bn is spent on the 16% of the population who have access to private health care, while only R220bn goes towards health care for the rest of the population.”
SA has the resources for every man, woman and child to receive quality health care, he said.
SA’s consolidated health budget for the current financial year (2019/2020) is R222bn. Of the R250bn spent in the private sector, R207bn comes from medical scheme contributions paid by individuals and employers and another R5bn from gap cover insurance.
Ramaphosa said the NHI would only contract with hospitals and clinics that met international quality standards.
“This approach implies that we will be undertaking measures to strengthen the health system as we implement the NHI,” he said.
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