SUSAN CLEARY: Will NHI enable SA to move closer to universal health coverage?

President Cyril Ramaphosa’ signing the National Health Insurance (NHI) Act on May 15, on the eve of the elections, is a smart move from the ANC's perspective of a political party seeking to shore up its base. The concern, though, to those of us working to strengthen the health system is whether the NHI will enable the country to move closer towards universal health coverage.

For the NHI naysayers, perhaps it would be important to alleviate some fears and concerns. The NHI is a long-term project. In the 2024 budget, the Treasury actually reduced the conditional grant allocations to the NHI in comparison to what was allocated in the 2023 budget. While signing the NHI Bill into law is a step forward, the reduction in resources towards NHI implementation is a step backwards. In addition, it is likely that there will be legal challenges that will lead to considerable delays before the scheme is fully implemented.

It is also important to mention that the NHI is a wide-ranging reform, with many positive aspects sitting alongside a smaller number of controversial aspects. These positive aspects include the opportunity to enable greater use of evidence and transparency in priority setting, as well as the opportunity to use national-level purchasing power to drive down the prices of commodities such as medicines.

The role of private providers (GPs, specialists) in the future NHI also holds some promise to improve access to healthcare across the breadth of our country.

My view is that there are two key controversial aspects. The first is related to what may or may not happen to medical schemes and medical scheme administrators once the NHI is fully implemented. My sense is that there is no short-term concern in this regard. A bigger concern from my perspective is whether a single pot of money in the NHI fund will present a larger or a smaller corruption risk than the current situation of multiple pots spread across provincial treasuries and medical aid schemes.

Another concern is that the NHI reform might disrupt our ongoing progress towards universal health coverage within our existing public sector — our current “NHS”. Our NHS is not perfect, but it is a system that has equity at its heart. The common definition of universal health coverage is to provide all individuals and communities with access to needed promotive, preventive, resuscitative, curative, rehabilitative and palliative health services of sufficient quality to be effective, while ensuring that the use of these services does not expose users to financial hardship.

Therefore, two key goals of universal health coverage are the provision of quality healthcare services to those in need; and the avoidance of financial catastrophe in this process.

Clearly healthcare is far from free — indeed it is very expensive — and so the goal of avoiding financial catastrophe is about implementing prepayment and risk-pooling mechanisms, whether these are tax or insurance based.

Let’s first look at how we are doing on the provision of quality services. Figure 1 below plots countries according to their achievements on the Universal Health Coverage Service Coverage Index.¹ In this context, coverage of essential health services is defined as the average coverage of essential services based on tracer interventions that include reproductive, maternal, newborn and child health, infectious diseases, non-communicable diseases and service capacity and access, among the general and the most disadvantaged population.

The indicator is an index reported on a unit less scale of 0 to 100, which is computed as the geometric mean of 14 tracer indicators of health service coverage.

On this index, SA’s achievement is at just over 70%, similar to many other middle-income countries. While there would be room for improvement, our performance is in line with our global peers.

Figure 1: Global comparison of countries in terms of service coverage and quality.

The second indicator is financial risk protection. Figure 2 plots countries against the percent of total health expenditure that is paid out of pocket at the point of use. On this indicator, we score 5.7%, indicating extremely high levels of financial risk protection.

Figure 2: Global comparison of countries in terms of the percent of total health expenditure that is paid out of pocket.

This does not mean that there are no instances of financial catastrophe — undoubtedly there would be, particularly for those seeking treatment for certain types of cancers. That said, over the past two decades I have studied this issue extensively. Across a wide range of conditions in diverse settings, we have interviewed tens of thousands of people to understand the costs that they face in using health services, including everything from transport costs, to costs of food, shelter or accommodation, costs of child care, lost income, under the counter payments to public sector providers (which we never found), fees paid to private providers or money spent at pharmacies.

This research consistently showed that the level of catastrophic spending was very low. Our performance on financial risk protection is outstanding. I celebrate the work of those colleagues that shepherded in the removal of user fees in our national health service (NHS) during the dawning of our democracy. We should all be thanking them.

Despite these successes on universal health coverage, there are areas of concern for the SA health system. We do not achieve health outcomes commensurate with our level of investment. My sense is that this is driven by our relatively high burden of disease; for example we continue to have the world’s largest HIV treatment programme. While our average life expectancy steadily increased with the advent of antiretroviral therapy (though note the downturn from 2020, which coincides with the Covid-19 pandemic — see Figure 3), the HIV epidemic has been a cruel setback that needs to be considered when we seek to make global comparisons on life expectancy and avertable mortality.

Figure 3: Global comparisons of life expectancy, 1970-2020

Now that the NHI Bill has become the NHI Act, we need to move forward from that basis.

Our NHS will be the backbone of our future NHI and so we should seek to continue to strengthen this system. We would also be wise to put in place measures to strengthen our private system given that private providers are intended to play a key role in the NHI. We should be pragmatic.

The NHI includes many exciting opportunities for leveraging big data and artificial intelligence (AI) in health systems strengthening, but at this stage we hardly have any electronic health data.

In addition, the NHI places a lot of emphasis on contracting private providers, but we have limited and rather mixed experience in that regard.

Let’s continue to push forward on many of these useful but complex undertakings. It is going to take time, but it is needed irrespective of the name that we choose to give to our health system.

• Cleary is professor of health economics and the head of the School of Public Health at the University of Cape Town.