Features, South Africa

Why NHI is Necessary

Founder and CEO of integrated healthcare management company PPO Serve, Dr Brian Ruff, shares his thoughts on the proposed NHI.

PPO Serve - EHN

Faced with the prospect of medical schemes dissolving under the proposed National Health Insurance (NHI) and the Health Market Inquiry’s analysis on the failure of the private sector to make affordable quality healthcare available to large segments of the country, the South African private healthcare system is in a time of review and reformulation.

Founder and CEO of integrated healthcare management company PPO Serve, Dr Brian Ruff, shares his thoughts on the proposed NHI.

Private healthcare is unaffordable. It was developed without adequate planning and supply side regulation. Nobody is held accountable for the management of cost or the quality of outcomes.

South Africa has a very hospital-centred system; so much care happens unnecessarily in a hospital bed that could be done in the community. For users of private healthcare services, this translates into escalating scheme premiums and benefit cuts, which has resulted in gaps in necessary care, especially for complex medical problems. The system also ignores the management of social factors that impact health.

The solution includes protecting risk pools and strengthening the active purchaser role of schemes, which will better manage the way medical care is supplied. In their current form, schemes’ risk pools are shrinking, leaving more elderly and sick members than healthy ones. When premiums are too high, families only purchase medical aid for the elderly and the sick. Treatment for these individuals’ costs schemes a lot of money.

A functioning and sustainable healthcare system requires cross-subsidisation from healthy new entrants. Re-establishing risk pools requires the regulation of insurance products that selectively cover low-risk groups, a step put forward by the new demarcation regulations, which will come into play in 2019.

The proposed NHI will introduce a single fund that will also support the purchasing of medical services for the country. Regional contracting units that are familiar with the needs of their population will review and purchase doctors’ and hospital services. While it is not yet clear if these will be public or private entities, I like the structure put forward by government.

It will create real competition and accountability. Providers will contend for limited-term contracts, based on the service and values that they deliver to patients as well as their ability to best meet the needs of the community as a whole.

The best solution requires legislating benefits that supports new integrated models of care that deliver effective comprehensive clinical and social care, and that compete for patients and contracts on the outcomes they produce.

Dr Ruff co-founded PPO Serve with his colleague Riedwaan Jabaar in 2015 to develop integrated clinical consortia in the South African context. The model is based on practitioners forming multidisciplinary teams that contract with purchasers, based on the value that they deliver to their patients. According to the company, their pilot project in Alberton has been running for a year and is showing good results for patients, clinicians and schemes. PPO Serve has also recently launched The Birthing Team, which provides access to affordable, personalised maternity care for expectant mothers without medical cover.

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