Principal Officer of Bonitas Medical Fund, Gerhard Van Emmenis, explains why it’s imperative for measures to be put in place that will allow medical schemes to work in tandem with National Health Insurance (NHI), so that value for money is achieved and duplication of costs prevented.
The NHI White Paper stipulates that until NHI is fully implemented and matured, the role of medical schemes will not change.
Director General of the Department of Health, Precious Matsoso, stated that: “This doesn’t preclude any changes to the business of medical schemes or transformation required in medical aid schemes. Currently, the medical schemes’ role under the fully matured NHI is that of complementary services cover. This means that only services not covered by NHI can be offered as cover. If medical aid schemes undergo both voluntary and regulatory reform to become aligned and consistent with the objectives of NHI, there will be a need to relook this.”
Bonitas is premised on making quality healthcare more affordable and accessible. We therefore welcome the efforts of NHI to improve access to healthcare. However, our key concerns are around quality and preventing duplication of services.
If the future means there is only complementary cover from medical schemes then it will be very limited in its offerings with cover for services such as dentistry and rare conditions. This means that the number of medical schemes will greatly reduce.
The number of medical aid schemes is dwindling regardless, as many schemes are struggling to main sustainability. However, clarity is needed around whether people will be prevented from belonging to a medical aid scheme. The funding model for NHI means that everyone will contribute towards NHI through a tax-based system but, if you still choose to belong to a medical scheme then it’s your choice and a cost to you of your after tax money.
The predicated scenario is that the contribution to a ‘private’ medical scheme will be significantly less through price and other regulation, making the schemes more affordable while, at the same time, using current medical scheme spending to cover vulnerable groups.
The private healthcare sector is not just for medical aid members
In 2016, Statistics South Africa estimated that 1,515,000 households with no medical aid normally used the private healthcare sector and 706,000 households, where at least one member had medical aid, used the public health sector. In total, 4,679,000 households’ normal place of consultation was the private sector.
This supports the findings of the National Income Dynamics Study, conducted in 2014 by the Southern Africa Labour and Development Research Unit at the University of Cape Town, which surveyed a nationally representative sample of more than 28,000 individuals in 7,300 households. The study found that 41.5% of the respondents went to see someone in the private healthcare sector at their last visit.
The reality is that many people use a combination of both sectors which means the number of people with medical aid does not equate to the number of people using the private health sector. The converse is also true with some medical scheme members using public hospitals or state clinical protocols for the treatment of specific conditions such as TB.
The role of medical schemes
Acting Managing Director of the Board of Healthcare Funders (BHF), Dr Clarence Mini, said he believed there should be more debate about the role of schemes in the future. He stated that: “Since 2008 we have supported the idea of NHI and believe that it is in the interests of the greater good of everyone – and not just the 16% who belong to medical schemes. But we believe medical schemes have a bigger role to play and should not be side-lined. For example, we think it is a mistake to use a single-funder system.”
Mini added that: “multi-payer’ system would mitigate a lot of risk and is one of the ways that the private sector can lend their expertise to the government regarding the setting up and management of pooled money within NHI. The Road Accident Fund is an example of what happens when you have one funder, when that funder goes down you’re in trouble.”
I agree with this sentiment and believe that for NHI to be a success, collaboration between medical schemes and government is essential. There needs to be agreement on the roles of both players as well as which benefits will be covered by NHI and which can be offered by the medical schemes.
But what can medical schemes offer that NHI can’t?
It must be conceded that irrespective of how comprehensive NHI will be, some healthcare services will not be covered. This includes mental health and certain dental benefits.
According to the NHI White Paper, NHI will be rolled out in priority areas first. The initial priorities include healthcare at schools, childhood cancer, women’s health (including pregnancy, cervical cancer and breast cancer), disability and rehabilitation services, and hip, knee and cataract surgery for the elderly.
But what about the remainder of the population? Medical schemes offer a number of benefits that are immediately available to members. This allows members to access the care they need, when they need it. If NHI is to be rolled out to specific target groups first, what becomes of others in need?
Active management of chronic diseases
Medical schemes often cover a range of chronic diseases through managed care programmes which equip members to manage their condition more effectively. We’ve seen improvement of 72% in Bonitas members with chronic diseases – especially diabetes and HIV. Quality of care is a central theme for us and we are pleased that our initiatives in this regard are bearing fruit. Engagement, collaboration and negotiation with healthcare professionals and service providers enable us to develop innovative solutions that ensure our members have access to care of the highest quality and receive maximum value for money.
Existing medical schemes and administrators look after millions of South Africans and that capacity does not yet exist in the public sector. Managing the healthcare needs of 55 million South Africans will be an administrative nightmare and further drive costs up.
A key healthcare challenge is finding a way to identify pre-cursors for serious chronic health conditions and intervening before the onset of disease. While NHI makes provision for preventative care, it is not clear what this will entail.
Bonitas uses an innovative emerging risk model which identifies members likely to develop chronic conditions. We then conduct a series of interventions to prevent the development of these or help members to mitigate their severity. This includes access to health coaches, education material and reminders for tests. It has proved very successful with over 32,000 members benefitting.
The state sector currently has very low patient-dentist ratios. This is compounded by the fact that many dentists choose to operate in the private sector.
More than 16.5% of adult South Africans are dealing with some form of mental health disorder, while 30% are likely to suffer from a mental disorder over the course of their lifetime. This is based on the South African Stress and Health study – the first and only nationally representative study of mental disorders in the country, which was done back in 2004.
13 years on, the figures are likely to have risen substantially. As things stand, only a fraction of government’s national healthcare budget is allocated to mental healthcare. Mental health is a key concern for Bonitas, we offer a range of benefits to aid members seeking support for depression, anxiety and other mental health concerns.
The sustainable funding question remains
The healthcare industry continues to be impacted by escalating costs which have made it difficult for many medical schemes to maintain sustainability. NHI not only faces a formidable challenge in funding, but there is also a severe shortage of healthcare providers, a massive disease burden and a blundering healthcare bureaucracy.