South Africa’s National Health Insurance program will need investment

Aug 11, 2011 12:00 AM

South Africa's proposed National Health Insurance programme, aimed at giving greater access to healthcare for the country's poor, will require 125 bn rand ($ 17.3 bn) in 2012 and 214 bn rand by 2020, a government source said.
The NHI, currently being discussed by the government and other parties in South Africa's healthcare system, will require 255 bn rand by 2025, the source said. If the NHI is implemented, it will be one of the biggest changes brought in by the African National Congress since it came to power in 1994.

“The goal is to try and finance healthcare for everybody,” Health Minister Aaron Motsoaledi told at a briefing.
Motsoaledi said that proposed system will not be able to mirror South Africa's advanced private healthcare sector but would give millions of poor better access to healthcare.
“NHI is not intended to destroy the private health care sector. (It) is one meaningful way to reach across the wealth gap. We all need decent health care,” he said.

The government has said it was investigating how the NHI would be funded and among the options were surcharges on taxable income, increases in value added tax (VAT). Analysts expect the main source of revenue to come from general taxation.
South Africa is spending about 8.5 % of GDP on public healthcare but the standard of service is poor. Giving the majority access to world-class private facilities aims to improve quality off health treatment.

Contributors to private healthcare schemes are concerned that the NHI would force them to seek treatment at poorly run and overcrowded state facilities. The policy will be published in the official government newspaper, kicking off a three month consultation process with industry stakeholders.
Health industry officials said many private healthcare providers were not opposed to the NHI.

“Private healthcare professionals are not opposed to the NHI because it will bring more business to them but they want to see what the paper sets out,” said Dr Norman Mabasa president of the South African Medical Association.
“We want to see what government plans to include on the NHI and how it will be implemented. We don't expect the free system to cover everything that private medical offers.”

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