Understanding how the national health insurance will impact you

Since the government announced that they were looking to introduce a national health insurance scheme (NHIS), there has been a lot of confusion, speculation and panic among private health-care users and providers.

So what exactly is national health insurance, how is it going to work and what are the cost implications on the taxpayer?

The Department of Health has described the NHIS as a financing system that will ensure that all citizens of South Africa are provided with quality and affordable health care based on their health needs, regardless of their employment status and ability to make a direct monetary contribution to the NHIS Fund.

This fund will pay for health care for all South Africans; there will be no fees charged at health facilities because the NHIS fund will cover the costs of your care.

It is similar to private medical schemes except for two differences.

The first difference is that the NHIS will cover every South African regardless of their socio-economic status.

The second difference is that the socio-economic status of members of the public will not influence the type of health care they receive, but it will be influenced by their health conditions. There will be no limited benefits because of the salary you earn or because you are unemployed.

The NHIS Fund will be run as a non-profit public entity. It will strengthen the hand of the health-care consumer and keep the cost of health care reasonable, while ensuring health-care providers receive fair and reasonable rates for their services.

The NHIS will offer all South Africans access to a defined package of comprehensive health services and will provide as wide a range of services as possible, from primary health care to specialised levels of care.

Patients will not be told their benefits have run out or be asked to share the costs of treatment unless a member of the public fails to follow the required referral route from general practitioner to specialist.

Treatments such as cosmetic surgery that is not necessary or medically indicated but done as a matter of choice will be excluded along with expensive dental procedures performed for aesthetic purposes and eye-care devices such as designer spectacle frames.

Any medications not included in the national essential drug list will also be excluded.

The NHIS benefits will cover preventative, promotive, curative and rehabilitative health-care services and will place emphasis on the prevention of diseases, such as HIV, Aids, TB and similar conditions, while promoting health among South Africans.

• How will it function?

Individuals who are already insured by medical-aid providers will be free to continue their medical scheme membership, but they will not be able to opt out from making contributions to the NHIS Fund.

Public medical aid such as Gems Medical Scheme will no longer exist, but members will be accommodated within NHIS and the government will no longer provide subsidies for medical scheme contributions.

Fewer people will continue with private medical scheme contributions, as it will be unnecessary to belong to both the NHIS and a private medical aid unless they intend to have cosmetic and/or non-essential surgeries.

The NHIS will provide finance for health care. It will, however, not involve itself in the management of hospitals, clinics or practices of GPs, dentists, specialists or any other health professionals.

The NHIS will enter into contracts with private and public hospitals, including private health practitioners and public clinics, in order to provide services. A patient will be able to choose any NHI-contracted provider near them for their regular health needs.

Public hospitals and clinics will be made to upgrade their facilities and health-care facilities will only be part of the NHIS system if they meet certain standards of care and are accredited by an independent body called the Office of Health Standard Compliance (OHSC).

The National Health Act is being amended to provide for the setting up of the OHSC. The aim is to ensure that members of the public receive quality health care from all health-care providers.

The OHSC will report to and advise the minister of health on a regular basis and will guide and inspect health facilities and only certify those that comply with the required standards. An OHSC certificate issued to a health-care facility will ensure that standards of hygiene, safety and respect for patients are being met.

The NHIS Fund will have strong buying power which will enable it to purchase health services at a reasonable rate. The rate at which the NHIS Fund will pay health-care providers will be higher than the present cost of public health services, but lower than most rates in the private sector. The NHIS Funds method of payment will encourage health-care providers to operate efficiently and provide effective care. As mentioned previously, the NHIS Fund will be run as a non-profit organisation and will aim to keep administrative costs low.

• Funding of the NHIS

The NHIS will get a large amount of their funding from general taxes. Therefore, every South African will make a contribution to the fund because we all pay taxes in one form or another.

People with low income will not make any direct payment to the NHIS Fund. Every person earning above a set amount will be required to contribute by law.

Monthly contributions made by the employees to the fund, in almost all cases, will be lower than medical aid tariffs and the direct NHIS payment will be larger for high income earners.

Employers will assist the NHI Fund by ensuring their workers’ contributions are collected and submitted in a manner similar to UIF contributions. Employers will match their employees’ contributions to NHIS.

South Africa already spends a high amount on health care. If private and government spending are combined it amounts to more than R200-billion a year. A substantial part of this is spent on private care for only 16 per cent of the population and private care is, at present, often needlessly expensive.

The NHIS Fund income will amount to at least as much as present health-care spending, but it is possible that government will be required to further boost this amount.

The NHIS will be able to count on all present government funding for public health care and all the money government spends on tax subsidies for medical scheme members and contributions from people who are presently members of medical schemes, and lastly contributions from those who earn well but have avoided joining medical schemes.

The Department of Health released the NHIS Bill recently for public comment. Should you require any further information on NHIS please visit www.health.gov.za or call 012 395 8000 to find out when the NHIS town hall meeting will be held in your community.