Hunting for Healthcare: In pursuit of the NHI White Paper

This Brief reports on a recent seminar hosted by the Albertina Sisulu Executive Leadership Programme addressing the progress and challenges facing National Health Insurance. The Brief focuses on the NHI pilot districts, the concept of Universal Coverage, and raises questions about financing healthcare.

The Minister of Health has asked us all to get behind the concept of National Health Insurance (NHI). Is this a good idea? What is South Africa’s policy on NHI? What should we be happy to get behind? What should we be watching out for?

It has been over one and a half years since the release of the NHI Green Paper. The Albertina Sisulu Executive Leadership Programme in Health (ASELPH) [1], which had expected the White Paper out by now, organised a Seminar entitled Strengthening the NHI Discourse: Progress, Prospects and Pitfalls [2]. Despite the policy uncertainty surrounding health, the Seminar raised some useful points and clarified several issues. This HSF Brief outlines select issues raised in the seminar together with a few of our own thoughts on NHI and health policy in general.

What’s in a name?

The conflation, by the Minister of Health, of the terms Universal Coverage, National Health Insurance (NHI) and National Health System (NHS) has been a concern of the HSF for some time. Much of the debate at the Seminar reiterated this concern. Universal Coverage [3] is an overall objective for any health system. NHI and NHS are two alternative mechanisms for achieving that objective. NHI and NHS do not, in themselves, guarantee Universal Coverage. The achievement of Universal Coverage would depend on the correct policy choices together with appropriate implementation. For example, South Africa might achieve full Universal Coverage by increasing the quality in, and access to, the public health system (to cover low and no income individuals), while ensuring the proper regulation of the private health system (to cover those in formal employment and who pay tax). One might even want to take the debate a step back by asking: if Universal Coverage is our ultimate objective, what are the different policies and delivery mechanisms to assist us in achieving it?

NHI according to the Minister of Health\

Even though the details on NHI are thin, the Minister of Health has previously been explicit that the focus of the next five years is on five key areas: improving infrastructure and maintenance; sorting out human resource deficits including HR development and management; improving the quality of care in the public health system; reengineering the primary health system; and decreasing costs in the private healthcare sector. Dr Anban Pillay, Head of Health Financing and Economics at the Department of Health, also reiterated that we would be unlikely to see implementation of any of the financial aspects of the policy before we have seen vast improvements in healthcare delivery in the public sector.

Challenges for South Africa

According to Prof Bill Hsiao, economist, actuary and Harvard-based health systems expert, South Africa faces four major challenges:

  1. Governance of Public Hospitals: Appropriate governance involves responsibility, power to exercise that responsibility, and accountability. In South Africa, public hospital CEOs do not have the power to control the financial and human resources of the hospitals they run. This makes it very difficult for them to deliver and to be held accountable. This issue is exacerbated by corruption and patronage in the provinces which also may not always allocate the correct funds to hospitals.
  2. Bringing together the public and private health systems: Here the key issue is to establish how the country can bring together the pro-poor strength of the public health system with the technical capacity and higher quality in the private health system.
  3. Choice of Benefit Package: In the determination of health policy, a key consideration is what benefit package is offered to the population. One needs to ask what is affordable, feasible and sustainable. It can also come down to a political question for the political parties as they must determine how much they can afford to promise in the way of healthcare while being aware that failure to deliver could have serious political consequences.
  4. Sustainable Financing: There is still much uncertainty about the cost of NHI and the general financing aspects of the policy. Very concerning is that South Africa does not have reliable data to make accurate cost estimates. The Department of Health’s cost estimates in the Green Paper are not based on sufficient evidence.


The lowdown on the NHI Pilot Districts

The pilot districts are supposed to be the first intervention resulting from the NHI policy. Prof Hsiao was concerned that the Department of Health was not taking proper advantage of the opportunities presented by the pilots. He explained that, in China, districts were given the autonomy and authority to experiment on different models of delivery which gave them the opportunity to use different policies and methods of delivery for different areas. The central government took responsibility for the evaluation of the districts. Prof Hsiao explained that given the diversity in South Africa from province to province, an opportunity to experiment and tailor healthcare delivery to different areas should not be missed. If the pilot areas were effectively designed, they could also generate much needed data to assist in cost estimates. It is almost impossible to make predictions and design appropriate policies without accurate data.

Dr Pillay explained that part of the problem with the pilots is that there are differing institutional and organisational capacities across the different pilot sites. Furthermore, there is little chance of piloting new policy in sites where the health system is barely functioning. Thus, given the multiple policy demands, and the high possibility that quality of healthcare delivery in the pilots sites was not up to standard, systems are taking longer than anticipated to get going.

Concerns about money

Throwing money at the problem: Some of the speakers noted that NHI is likely to increase the country’s health spend. A central concern of the HSF is that if NHI results in more money being allocated to our Health System some key questions need to be addressed: Is South Africa currently effectively using the money already in the system? Are we getting bang for the tax-payer buck in the public health system? Are we getting bang for the medical aid premiums or out of pocket payments in the private health system?

Costing healthcare: Dr Pillay noted that, globally, countries find it extremely difficult to accurately estimate costs but followed up by saying that obviously that doesn’t mean we shouldn’t do it. There clearly needs to be a bigger focus on collecting accurate data. Prof Hsiao emphasised that with accurate data, healthcare actuaries should be able to predict costs within 10 % accuracy. This capacity needs to be explored.

Rationing: In the modeling of costs Prof Eric Buch, Dean of Health Sciences at the University of Pretoria, highlighted the importance of discussions on rationing. Here, determination of potential caps on provided healthcare, though sensitive, would also need to be discussed.

Corruption: Given South Africa’s corruption and patronage problems, any single fund is open to capture. If the Department of Health chooses to go this route, Prof Hsiao emphasised the importance of a representative board including members of civil society and trade unions.


Despite many requests by civil society and other organisations for inclusive and transparent stakeholder engagement, and many offers of assistance, the Department of Health has not appeared to fully engage with the broader public in the writing of the NHI White Paper.

It is positive to note that some challenges are honestly being indentified and some progress is being made in many areas. Acknowledgement by the Department that the key focus needs to be an overhaul of the public health system, is encouraging. We need, however, to be vigilant at ensuring that the proposed policies are strictly evidenced-based and that any policy deliberation or stagnation does not result in the further incapacity of the Department to deliver healthcare.

[1] From ASELPH Brochure: “ASELPH is a partnership between the University of Pretoria, University of Fort Hare, South Africa Partners and Harvard School of Public Health. It works closely with the National Department of Health to build the capacity of the senior national, provincial, and district health leaders and hospital management teams – those who drive health systems transformation in South Africa.”
[2] The experts at the event were as follows: Prof Bill Hsiao – Harvard University School of Public Health; Dr Anban Pillay – National Department of Health; Prof Eric Buch – University of Pretoria; Prof Stephen Hendricks – University of Pretoria.
[3] Universal Coverage is defined by the World Health Organisation as: “ensuring that all people can use the promotive, preventive, curative, rehabilitative and palliative health services they need, of sufficient quality to be effective, while also ensuring that the use of these services does not expose the user to financial hardship.”

Kate Francis –
Helen Suzman Foundation