Government spends R100 billion to subsidise private medical care, says NHI spearhead

The newly reinstalled Minister of Health, Dr Aaron Motsoaledi, came out firing in support of the National Health Insurance (NHI).

The former home affairs minister submitted the Department of Health’s budget for the 2024/25 financial year to the National Council of Provinces on Wednesday, 17 July.

Motsoaledi has been championing the NHI since he was first appointed health minister by former president Jacob Zuma in 2009.

NHI only in phase two

The R62.2 billion budget set aside less than 1% for NHI, which is still in the embryonic stages of a revolution that Motsoaledi believes it will be.  

His budget allocated R1.34 billion to the current phase of NHI for this financial year and tabled an additional R2.79 billion for the next two financial years.

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These figures are dwarfed by the amounts allocated for primary healthcare, as well as hospital systems.

Primary healthcare is expected to receive at least R10.4 billion over the next three years, starting with R3.31 billion for this financial year.

Hospital systems, which encompass public health facilities, will have R23.9 billion at their disposal, with another R50 billion due in the next two financial years.

‘Government already subsidises private healthcare’

The minister’s speech hinged heavily on the social imperatives of implementing NHI, hailing it as levelling the playing field between rich and poor.

He argued that the economic standing of citizens determined their level of care. He blamed the wealthy for trying to scupper NHI, even taking aim at his parliamentary colleagues.  

“I am painfully aware that in this House, I am standing in front of human beings who fall within one category of a privileged few who receive costly private care at the expense of the poor,” said the health minister.

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Motsoaledi suggested that some government employees were blind to the privileges already afforded to them.

He did not spare the private sector, adding that rebates given to those using private healthcare schemes brought the overall figure to R100 billion.

“1.3 million public servants, plus all Members of Parliament and Legislatures, and all judges of our country, are subsidised by the fiscus, to the tune of R70 billion per annum,” he explained.

“Any person in our country who is on a medical aid receives tax rebates from SARS. I am made to understand that this tax rebate amounts to approximately R30 billion,” continued Motsoaledi.

Low spend vs results ratio

Motsoaledi further argued that the world was in the throes of a third great medical transition.

Using The Lancet as a source, the minister stated the demographic transition and epidemiological transitions were the first two, stating that universal basic healthcare was the third.

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The World Health Organisation advises that nations spend 5% of GDP on healthcare, with Motsoaledi stating that South Africa exceeded that.

“We are at 8.5% on average. European countries are at 9%. This means that our health system was supposed to be as advanced as countries in Europe,” he insisted.

Challenging his audience, he concluded, “As is evident, that is not the case. The question is why?”