NHI The only Affordable Option

Experts say the government’s National Health Insurance initiative is the answer to affordable healthcare and soaring medical aid costs

EXPERTS believe the government’s proposed National Health Insurance (NHI) initiative, aimed at making healthcare more accessible and affordable, could be the answer for soaring medical aid costs that are putting consumers under increasing pressure. 

Medical aid appears to be at risk of becoming unaffordable to consumers as medical aid providers continue to hike prices in a bid to meet demand given the rising number of patients.

Last week, Roseanne da Silva, president of the Actuarial Society of South Africa, said the affordability of medical aid schemes into the future will depend on a change of mindset from both members and healthcare providers. 

“Escalating claims in 2016 have placed schemes under increasing financial pressure, likely to result in higherthanusual contribution increases for next year,” she said.

Bonitas, one of the biggest medical aid providers in the country, announced last Thursday, that after a challenging year for the healthcare industry, the premium increase for 2017, across all its options, will be 11.9% without a decrease in savings.

“Negligible economic growth, increased interest rates, inflation and basic costs of living have resulted in significant financial strain on consumers,” Dr Bobby Ramasia, principal executive officer at Bonitas, said. “Rising costs of hospital admissions and medical inflation has, as expected, surpassed the consumer price index by between 3% and 5%.”

Some observers called on the government to fast track the implementation of NHI as the medical aid schemes provided by the private sector continues to skyrocket by double digits every year, making it difficult for consumers to afford.

The white paper, released by the Health Minister Aaron Motsoaledi for public.comment in December last year, proposes mandatory membership of NHI and reduces the role of medical schemes to merely providing “complementary services”.

It says the annual cost of NHI in 2025 will be R256bn in 2010 terms, assuming the economy grows at 3.5% a year.

However, the primary healthcare phase of NHI, which was expected to start in April this year, has been delayed by around six months.

Addressing delegates during the Government Employees Medical Scheme’s (Gems) annual symposium held in Soweto on Friday, the chairperson of the Gems board of trustees, Nontobeko Ntsinde, said disproportionate healthcare spend between the public and private sector means a major transformation is required in the industry.

“Gems is uniquely placed to contribute its experience towards the realisation of NHI, having 1.8 million lives under its care with annual contributions totalling R3Obn and the lowest non-healthcare expenditure rate in the industry.

“Our duty is to provide social good to public service employees, making healthcare accessible to South Africans and that NHI is the answer going ahead,” she said. 

Jill Larkan, head of healthcare consulting at GTC, said medical aid groups were facing challenges as hospitals are increasing costs at a disproportionate rate.

“Big industry players will be forced to merge,” she said.

Sign up to our mailing list

Receive the latest news & tips from ASAIPA