The end of medical aid in South Africa – businesses warn government of a big fight ahead

 ·28 Nov 2023

Business organisations BUSA and B4SA have written to the presiding officers of the National Council of Provinces (NCOP) and deputy president Paul Mashatile – in his capacity as leader of government business in Parliament – warning that the National Health Insurance Bill making its way into law is unimplementable and unconstitutional.

The groups – representing and lobbying for business interests in South Africa – said that the current processing of the NHI Bill lacks the proper due process, and the NCOP Select Committee on Health and Social Services adopting the Bill without any amendments will likely face constitutional challenges.

“No consideration was given by the select committee to the many constitutional issues, both procedural and substantive, in the Bill, which were raised by four Provinces and a wide range of stakeholders,” they said.

“This amounts to a serious and significant procedural lapse and a violation and disregard of Parliament’s own public participation model, fundamentally undermining the principles of participatory democracy on which our Constitution is based.”

The business groups requested that the NCOP not consider the Bill during its plenary session on 29 November but rather defer consideration of the Bill until the Select Committee has substantively discussed and engaged on the comments and proposals put forward by stakeholders, as well as those of the provincial legislatures and the Department of Health itself.

Cas Coovadia, CEO of BUSA, said that failure to do so – and for the National Assembly and the NCOP to disregard proposed amendments just so that the government can rush the Bill through Parliament – is unconstitutional.

“It makes a mockery of due process and portrays the NCOP as nothing more than a rubber stamp,” he said.

Coovadia said that the Bill in its current form is “utterly unimplementable” and will have severe consequences for South Africa, the economy and every citizen for generations to come.

“The self-evident truth is that there is no money to fund this NHI Bill, and there is no clarity over its benefits, contracting terms, capacity, systems, management, governance or even a plan that begins to outline a viable approach to these fundamental considerations,” he said.

“We have also repeatedly cautioned against a single fund for the NHI that, inter alia, will require taxes to be raised to unsustainable levels. This is unaffordable, unsustainable and presents a material risk to the economy.”

Other critical failures of the Bill, according to the business groups, are

  • The Bill does not provide for public-private sector collaboration.
  • Medical schemes will not be able to cover or pay for any health service offered by the NHI – which will impact all employed citizens, including public sector employees who currently enjoy medical aids as a material employee benefit.
  • It imperils the entire private healthcare sector, which depends on medical schemes for financing.
  • The Bill limits access to healthcare for over 9 million South Africans, infringing their constitutional rights.

Given these blatant issues in the Bill, the groups said that “there are bound to be numerous legal challenges to the Bill, and the consequence will be that the NHI will not be implemented at a time when we all agree that it is imperative to address the many challenges facing the country’s healthcare sector”.

The groups urged the government to – as a start – amend Section 33 of the Bill, which currently says that when the Minister of Health declares that the NHI is fully implemented, medical schemes will not be able to cover or pay for any health service offered by the NHI.

This will, at the very least, bring the private sector on board and open the way for further reforms.

“The private sector has made repeated suggestions as to how reforms can be immediately implemented in order to improve access to quality healthcare for many more millions of South Africans,” the groups said.

“The introduction of low-cost medical aid options is one such example. All that is required is for the Council of Medical Schemes and the Minister of Health to approve them.”

These proposals have been on the table since 2015, but no satisfactory explanation has been provided as to why there appears to be regulatory paralysis, they said.

Furthermore, the cost of private medical aid cover could be reduced by over 20% if the 2019 recommendations of the Government’s Health Market Inquiry are urgently and responsibly implemented.

“All of these initiatives can start now. This will take further pressure off the public healthcare sector and move universal health coverage forward in a way that supports the NHI, in a meaningful and visible manner,” they said.

Read: Big NHI surprises ahead for South Africa

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