Smokers and drinkers may cough up more to fund NHI

By Sipokazi Fokazi

With many South Africans still in the dark about how the financing of the proposed National Health Insurance (NHI) will affect their pockets, smokers and drinkers should mentally prepare themselves since they could feel the pinch most.

That’s if recommendations in the latest South African Health Review report are anything to go by.

Authors of the Health Systems Trust publication suggest that, given the fact that chronic diseases have become the largest national burden of disease, “consideration should be given to increasing excise taxes on alcohol, cigarettes and sugary drinks”, to fund universal health coverage.

They argue that public support of such taxes is stronger when a portion of the revenue is allocated to health interventions. Such a move, which has worked in countries such as the Philippines, would not only fund the country’s biggest health reform, but would result in less consumption of harmful products such as alcohol and cigarettes.

Another option could be for SA to develop a mandatory social security contribution, or gradual introduction of a payroll tax, which may be “palatable if it accompanies improved quality and benefits”. Such a tax could be part of total revenue and need not be ring-fenced for health.

In a review titled National Health Insurance: vision, challenges and potential solutions, authors including Mark Blecher, the Treasury’s chief director for health and social development, Stephen Harrison, the head of strategy at the Council for Medical Schemes, and Thulani Matsebula, senior health economist at the World Bank, argue that the NHI has the potential to fundamentally transform the country’s health sector, “but steps to move to this direction need to be articulated more clearly”.

They say there seems to be anxiety among stakeholders, including the private sector, because the government has not effectively communicated what NHI means, what range of health services it will provide, and what role health providers and health workers will be playing.

They urged the urgent implementation of an NHI roadmap, which must outline a time-bound framework for how universal health coverage will be implemented, what the tangible deliverables are, and how such activities will be completed and by whom.

Thulani Matsebula, senior health economist at the World Bank, is one of the authors who have raised concerns about how the government is going about its NHI plan.
Image: Supplied

According to the NHI White Paper, the government aims to implement NHI by 2025, but questions still remain about what it will cost and how it will be paid for.

While the policy document envisages private healthcare providers as an essential part of the provision of health services under NHI, authors of the review say that, in practice, the private sector’s involvement to date has remained very limited, and with ambiguous messages about their role.

So far, the private sector’s role has largely been limited to contracting doctors’ work sessions in public health clinics rather than purchasing services as proposed by the scheme’s central fund.

“Development of NHI policy has been done almost in isolation of private providers, and consultation of private providers has largely been indirect, often through them submitting public comments in response to the release of policy papers. This has resulted in mistrust and confusion between private providers and government when it comes to NHI,” the authors said.

But the private sector should also be prepared to progressively take a bigger role in services provision beyond the medical scheme population, “by showing willingness to offer more favourable prices in exchange for higher patient volumes from the public sector and the poor who are unable to afford medical scheme contributions”.

“For example, incentives for private solo GP practices to arrange themselves in multidisciplinary group practices or to utilise nurse practitioners, and for hospitals and doctors to work in a more integrated manner, should be explored.”


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