A Short Matrix, If Introducing An NHI

Dr. Aaron Motsoaledi, Minister of Health. Source: SABC.co.za
Dr. Aaron Motsoaledi, Minister of Health. Source: SABC.co.za
Dr. Aaron Motsoaledi, Minister of Health. Source: SABC.co.za
Dr. Aaron Motsoaledi, Minister of Health. Source: SABC.co.za

Dear Minister of Health,

A National Health Insurance covering all South African citizens and enabling them to have access to an effective health service, is necessary, both from a humane point of view and from an economic one. Better general health can only be advantageous for the economy and the general wealth, which cannot only be measured materially.

Despite having a very positive opinion about Dr. Aaron Motsoaledi as being a responsible medical doctor and one minister who really intends to do effective work, the results of the considerations about an NHI are disappointing.

As I consider a general health insurance affordable and effective for every South African citizen and lawful resident, both morally and economically advisable, I present the following short matrix on how to structure considerations:

A. Ways of organising, and the possibilities

  1. Leave everything as it is;
  2. Nationalize all kinds of health services. Then decide on which level of government – communal, province, or state – NHI shall be provided;
  3. Complete privatisation of all health services, with the state legislating a framework of rules. Of course, this would be my option; or
  4. A mixed system of public and private service providers.

B. Additional aspects to consider

  1. The legal minimal requirement of cover based on a general evaluation of average health risks and averagely-needed services.
  2. Definition of risks and services which must not be covered due to irrelevance of costs and needs.
  3. Besides that, complete freedom to choose the scope of covered risks.
  4. Definition of the participants – these will be South African citizens and foreigners residing legally (with a temporary or permanent residence permit) in South Africa.
  5. Establishing a duty to annually check the basic state of health for everybody who is covered by the NHI. Emphasis shall be on preventive medical treatment.
  6. If someone is damaging his health partly or completely by recklessness – for example, by doing dangerous sports without proper precaution, taking drugs, excessive alcohol consumption, excessive smoking or only partly covering of costs of treatments – it cannot be that the public pays for private “sins”.
  7. Costs must be clear, calculated truly, and transparent. Costs must be budgeted at the place where they arise – no wandering of costs through various institutions.
  8. Stating the difference between a public (if any) or a private hospital or health service provider. Firstly, there is no difference: Both must be managed both in the medical and the organisational sphere arte legis according to the rules of art applicable. The state as owner could resign on receiving an interest on capital investments. The financial result of every health service provider  must be positive in any way in order to be able to make necessary investments and improvements. The state could, if taking up loans be necessary, act as guarantor in order to improve the credit standing.

C. Who will pay? 

There is no such thing as a free lunch. Everything costs something and has a price. The only question is who will pay! Here are possible ways of organizing it:

  1. Leave it as it is.
  2. The state carries all costs and pays with tax revenue.
  3. Everyone pays for themselves, either through their own means or through their own health insurance, or a professional one, for example organized by an enterprise for its employees.
  4. A kind of ‘self administration’ like the ‘Krankenkassensystem’ in Germany or Austria.
  5. A duty to insure yourself (‘Haftpflicht’) either by private insurance or one organized, common health insurance.
  6. This is then organized as follows:
    • a. The state pays totally or partially the premium, according to the individual’s income;
      • i) Directly towards the health insurance company; or
      • ii) Directly towards the person insured.
    • b. The state concludes a group insurance to the benefit of persons up to a certain income to be considered and decided with one or more private health insurance companies;
    • c. The state runs a health insurance company of its own; or
    • d. Organisations like trade unions or chambers of commerce, etc. may conclude group insurances for their members.

My personal preference would be solution 5, combined with 6b.

I do hope this helps, Minister Motsoaledi.