NHI Bill: NEASA submits written commentary. Fiscal armageddon that must be stopped

NATIONAL HEALTH INSURANCE BILL
NEASA SUBMITS WRITTEN COMMENTARY
FISCAL ARMAGEDDON THAT MUST BE STOPPED

by Rona Bekker

Dear NEASA subscriber

On 7 August 2023, the National Council of Provinces Committee for Health and Social Services, published the draft National Health Insurance (NHI) Bill (‘the Bill’) for public comment.

NEASA takes a firm stance against the implementation of the NHI, especially considering the disastrous effect it would have on the South African economy, the citizenry, in particular the tax-paying base, as well as the public and private health sectors.

Although there may be numerous medical-technical concerns surrounding the implementation and operation of the NHI, NEASA did not address these concerns, as the experts in the medical field, as well as the giants of industry in the medical- aid and insurance sector will sufficiently do so. NEASA’s submission focussed on the following concerns surrounding the Bill:

• the funding of the National Health Insurance;
• Government’s inability to implement and regulate NHI and National Health Insurance Fund (NHIF);
• regulatory obstructions to the successful implementation of the NHI;
• the effect on healthcare institutions, medical centres and hospitals;
• destruction of private medical aid and insurance providers;
• exodus of medical professionals (both from public service to private sector, and out of South Africa);
• international review of the success of NHI-similar systems; and
• the unconstitutionality of the NHI Bill.

Economists and financial experts estimate the costs of the implementation of the NHI to be between R300 and R700 billion. This is a significant increase from the estimated R190 billion the Government currently spends on healthcare in total in the country.

South Africa only has 7.4 million individuals with taxable income, of whom 5.5 million have been assessed in 2021, in a population of 60.4 million. As the taxable income of taxpayers amounts to roughly 24% of GDP, the amount of 5% of GDP to be raised from existing taxpayers to fund the NHIF, would require a 20% increase in taxes if distributed proportionally.

There are a multitude of facts, statistics and past occurrences that demonstrate why the Government is unable to implement and regulate a scheme and a fund with the NHI and NHIF’s magnitude. These concerns, coupled with the analysis of the costs of an NHI, make it abundantly clear why the NHI can and should never be implemented in South Africa, until we have a competent government.

Contrary to Government’s delusional belief, the NHI will reduce access to and quality of healthcare. The entire NHI system is premised on flawed assumptions and disregards the key reasons for the poor performance of the public health system. These failings make for a skewed diagnosis of healthcare issues, leading to a skewed assessment of how these challenges should be overcome.

The real aim of the NHI is to help advance the ANC’s National Democratic Revolution by dislodging business from a key sphere of market-based provision, effectively nationalising private healthcare resources, building dependency on the State, and establishing the principle that private spending must be pooled with public revenues for the ‘benefit of those in need’.

The NHI, foremost, poses a risk to the private medical sector, poses a risk to the fiscus, and places an unsubstantiated faith onto the South African government – it cannot be supported.

To read NEASA’s submission, click here.

Rona Bekker is the Policy Manager at the National Employers’ Association of South Africa (NEASA).

For more information:
NEASA Media Department
media@neasa.co.za