Election of Chairperson; NHI: public hearings day 18

This premium content has been made freely available

Health

31 August 2021
Chairperson: Dr K Jacobs (ANC)
Share this page:

Meeting Summary

NHI: Tracking the bill through Parliament

The Portfolio Committee on Health elected its Chairperson and continued with the public hearings on the National Health Insurance Bill. Dr K Jacobs (ANC) was nominated unopposed as Chairperson. He accepted the nomination and was declared Chairperson of the Committee.

Concerns were raised about the conflicting news about vaccinations. Members proposed that the Committee facilitate a platform where the opposing narratives could be presented, debated, and questioned to better inform South Africans about the COVID-19 vaccination. 

The South African Teachers Union presented its oral submission on the National Health Insurance Bill to the Committee. The Union emphasised the need to optimise the public healthcare sector and ensure affordability under National Health Insurance. The Union supported Section 27 of the Constitution, namely that everyone had the right to health services, that the State must take reasonable legislative and other measures within its available resources to achieve the realisation of these rights and that no one may be refused emergency medical treatment. It was highlighted that the Bill was silent on the real cost implications of National Health Insurance. The presentation highlighted the perception of lesser quality healthcare facilities in South Africa and the hesitancy of South Africans in using public healthcare facilities, including the Deputy President, Mr David Mabuza, who “preferred Russia” as a healthcare destination to South Africa. The Union did not support the Bill’s approach toward medical schemes. However, in line with the Health Market Inquiry, reforms in the private healthcare sector were necessary. The presentation highlighted potential Constitutional challenges, including the redirection of provincial powers to a national level, which would circumvent the powers of provinces.

Members noted the Union’s anxieties about the potentially destabilising effects on the medical scheme industry. It was suggested that clause 33 of the Bill stated that medical schemes would only be expected to provide complementary cover once National Health insurance was fully implemented. Concerns around the potential for people to insure against the same healthcare costs twice was highlighted. It was suggested that this would perpetuate the current inequalities in the healthcare system. Members emphasised that the two-tier healthcare system was broken, benefitting ‘the rich.’ It was stated that the Deputy Minister’s trip to Russia was not a sign of ‘less confidence’ in South Africa’s health system. Clarity was requested about the potential for emigration in response to the implementation of National Health Insurance.

Government’s lack of response to the recommendations made by the Health Market Inquiry was acknowledged. Clarity was requested about which organisations in the medical industry were challenging National Health Insurance. The pressure that National Health Insurance would place on the small tax base was acknowledged. Clarity was requested about the projection of a ‘three to five percent’ tax increase and if this was based on current medical schemes prescribed minimum benefits expenditure. The Chairperson requested that the technical analysis, that informed the projections, be communicated to the Committee. Clarity was requested about the Union’s view on clause 49 of the Bill and chapter seven of the National Health Insurance White Paper.

Meeting report

Election of Chairperson
The Committee Secretary, Ms Vuyokazi Majalamba, stated that Rule 158 of the National Assembly Rules required that the Committee elect one of its Members as Chairperson. A call for nominations was made. 

Mr T Munyai (ANC) nominated Dr K Jacobs (ANC). Dr Jacobs was the most qualified Member of the Committee and possessed more than six degrees in medicine. He had demonstrated his hard work to the Committee.

Ms A Gela (ANC) seconded Dr Jacobs’ nomination.

Dr S Thembekwayo (EFF) stated that the Economic Freedom Fighters (EFF) would not take part in the nomination process.

The Secretary confirmed that there were no further nominations. She congratulated Dr Jacobs on being elected as the Chairperson of the Committee. 

The Chairperson thanked the Secretary for the clear election process and the work she had done for the Committee. He thanked the Acting Chairperson, Mr Munyai, for the work he had done over the previous weeks. This had included leading the successful oversight visits to KwaZulu-Natal (KZN) and Gauteng.

He thanked the Deputy Minister of Health, Dr Sibongiseni Dhlomo, for setting a good tone as the former Chairperson. The Committee would continue with the good work of the former Chairperson.

He reminded the Committee of their roles and responsibilities. The work the Committee would be doing was well expressed in the vision and mission statements of the Sixth Parliament. The Sixth Parliament was an active and responsive People’s Parliament. It aimed to improve the quality of life for all South Africans. Members’ roles in the Committee were the same for Parliament in general, as the Committee was an extension of a function to a smaller working group. He reminded the Committee that it represented the people. The Committee was there to pass laws and oversee the executive functioning. The Committee would pull together in harmony, mutual respect and dedication to the work set before them.

The Chairperson stated that the Members had received presentations from two groups. However, one group had asked for a postponement which the Committee would need to consider and reschedule.

Mr A Shaik Emam (NFP) congratulated the Chairperson.

He noted there had been a lot of conflicting news about vaccinations. He pleaded that a platform be given for the conflicting views to be debated by the “anti-vax” movement and bodies such as South African Health Products Regulatory Authority (SAHPRA). This would allow the Members to interrogate both sides to ensure the public was well-informed on such matters.

There was prevalent fear amongst the public – people were “dying out of fear, more than COVID-19”. He proposed that such a platform would allow for the provision of information and would convince the public that they were in good hands.

Ms Gela congratulated the Chairperson on his new position. She noted that he was a doctor, specialist sports medical physician, and biochemist. The Chairperson had post-graduate and undergraduate degrees from four South African universities, the University of Stellenbosch, the University of Cape Town, the University of Pretoria, and the University of the Western Cape. He was involved in the Secretariat of the Ministerial Task Team on District Clinical Specialist Teams (DCSTs). He was a Member of the Primary Health Care (PHC) Reengineering Task Team, a lecturer and facilitator at the Health Sciences Fraternity of Stellenbosch University and lectured at other tertiary institutions in the medical and health fields. The Chairperson deserved the position, was capable, and had the support of the Committee. She wished him luck on the new journey.

Mr Munyai stated that during his one-week tenure as Acting Chairperson, Mr Shaik Emam had raised the matter that was brought before the Committee. He did not think that such engagement, as proposed by Mr Shaik Emam, should be denied. He agreed with the proposal that SAHPRA should be present for such a debate.

He congratulated the Chairperson and reiterated that he was very capable. The Chairperson was an ex-combatant of the liberation struggle, a fact that many may not have known. The Chairperson had led the Committee capably during the public hearings on several occasions when the former Chairperson had network problems. He had not encountered anyone in the Committee, since the First Parliament as qualified as the Chairperson. There had not been anyone who possessed “six medical degrees”. The Chairperson was likely the only doctor with a Springbok jersey. One day when the Chairperson debated in Parliament, he should wear that Springbok jersey as a symbol that he had been involved in sport medicine to support the national team. The African National Congress (ANC) was pleased that the Chairperson would be serving the Committee and South Africans as he always had. The opposition had not proposed any other nominations, that was a sign of confidence across political parties in the new Chairperson.

Mr P Van Staden (FF+) congratulated the Chairperson on behalf of his party. The Chairperson’s qualifications spoke for themselves. It was time that the Committee had a chairperson who was duly qualified in medicine and science to take the Committee forward.

Mr M Sokatsha (ANC) congratulated the Chairperson, reiterating that the Chairperson deserved the position. He and the Chairperson had previously worked together in the Department of Health in the Northern Cape. The Chairperson was well-experienced in the field and had the support of the Committee.

Ms M Hlengwa (IFP) congratulated the Chairperson. She had confidence in him. She wished him well on the journey and thanked him for accepting the task.

Dr X Havard (ANC) congratulated the Chairperson. The Committee was fully supportive of him. It was a well-deserved appointment.

The Chairperson introduced Mr E Siwela (ANC), a new member of the Committee.

Mr Siwela congratulated the Chairperson on his appointment.

The Chairperson thanked the Members for their congratulations.

He noted the request made by Mr Shaik Emam. He would discuss the proposal of the debate with the Secretary. He noted that Mr Munyai had made the same request.

He was very proud to have earned a Springbok jersey and blazer. He had been hiding it, but he would wear it to one of the sittings in Parliament.

He anticipated that the Committee Members would work well together. He recognised his role and responsibilities as the Chairperson. He was fully aware that he would need to have a “non-political” hat on in the work that the Committee would do. He would do this to the best of his ability.

South African Teachers Union (SAOU) Presentation on the NHI Bill
Mr Chris Klopper, President of the South African Teachers Union / Suid Afrikaanse Onderwysers Unie (SAOU), presented to the Committee.

What are the underlying principles of SAOU submission?
The SAOU had a record of cooperation with authorities. It did not wish to fix what was not already broken and wanted to focus on optimising what was controllable. It supported optimising the Public Health Sector (PHS). It wished to establish calmness in relation to NHI planning and implementation. This required synergy and symbiosis, with affordability being paramount.

Quality public healthcare
The SAOU supported the principle of a quality PHS. It subscribed to the content of Section 27 of the Constitution. Section 27 (1)(a) stated that “Everyone has the right to health care services…”. Section 27 (2) said “The state must take reasonable legislative and other measures within its available resources to achieve the progressive realisation of each of these rights”. Section 27 (3) stated that “No one may be refused emergency medical treatment”.

Problem: Funding of PHS/NHI
The Bill was silent on the real cost implications of implementation and proponents were not prepared to enter the debate on the costing thereof, except to say that the envisaged costs would be exorbitant. Schemes like the NHI were successful in countries with broad tax bases. In South Africa, 5.5 million taxpayers contributed to the fiscus at a very high tax rate (the Laffer Curve was important in this regard). In South Africa, the maximum tax bracket was 45%. In Africa, the average was 31.9%. In the EU, it was 38.3%. In the OECD, it was 41.7%, whilst the global average was 31.2%. Estimates were that the average tax rate in South Africa would have to be increased by 3-5% to fund the NHI. Considering the constitutional prescription that the state should take reasonable legislative and other measures within its available resources to ensure adequate PHS, more affordable options needed to be considered in light of the clear risks of tax revolt or boycott.

Problem: Quality of facilities and services
Important questions included: why were private hospitals/facilities regarded as quality institutions? Why was the quality of public facilities not of the same quality? There was a perception of an irresponsible approach to maintenance, with appearances at public facilities supporting this. Gardens at Bela-Bela were unkept, and vehicles outside Bronkhorstspruit created the perception of it being a scrapyard.

The SAOU agreed with the principle of world class academic hospitals, hospitals, and clinics in rural areas that needed to focus on primary or preventative healthcare.

Progressive investment was required to provide buildings, facilities, and infrastructure, particularly taking note of the latest developments in oncology. Investment to prevent burglary and theft such as at Charlotte Maxeke Academic Hospital was also necessary. Investment needed to be directed at proper equipment and maintenance programmes.

Problem of governance and management
Why were taxpayers hesitant to utilise public facilities, as shown by the case of Deputy President Mabuza who preferred to travel to Russia for treatment? There was a perception of “lesser quality” at public facilities. Medical facilities required several additions to improve this. These included reasonable staff provisioning, the presence of competent staff focussed on the detail and implementing global best practice standards, management that managed facilities according to global best practice standards, as well as governance that complied with the same standards required of JSE boards of directors.

Position of medical schemes
Under the authority of the Council for Medical Schemes (CMS), around 7.7 million beneficiaries were serviced by the 15 largest medical schemes. This raised several questions. Why the need to destabilise 7.7 million people’s medical care? Would an approach to utilise these 7.7 million people are a base not make more sense than then current approach to prohibit services that could overlap with the NHI? This would only lead to resistance and legal challenges.

The Health Market Inquiry (HMI) report had raised two considerations. 1) The system of medical schemes could be made to work more efficiently without the need for government to take over the purchasing functions of the private health system. 2) The fragmentation of the medical scheme system could be addressed through the recommended pooling regimes, i.e., the risk adjustment scheme together with social reinsurance and the mandatory minimum package. Were the HMI’s suggestions to establish synergies and symbiosis not preferable to creating turmoil and conflict?

The SAOU could not support the current NHI approach to medical schemes.

Reforms in private healthcare; a necessity
Private healthcare was not a utopia and was beset with many problems. The HMI had concluded that the South African healthcare market was characterised by 1) excessive over-utilisation (with stakeholders unable to demonstrate associated improvements in health outcomes); 2) hospital admission rates, level of care, and length of hospital stay (i.e., utilisation rates) were found to be excessively high and a significant driver of healthcare costs; 3) the facilities market was concentrated with three hospital groups; 4) the administration market had a high level of monopolisation; 5) there was inadequate stewardship of the private healthcare sector, including the Department of Health’s failure to make use of existing legislated powers to manage, review, and regulate the sector.

The HMI was convinced that the interventions would result in 1) lower costs and prices in the healthcare industry, 2) more value-for-money for consumers, 3) address issues of monopolisation, and 4) increase innovation in the healthcare sector.

It unfortunately needed to be noted that a statement made by the Competition Commission had outlined that the Competition Act did not apply to the healthcare market and the HMI. This needed to be addressed.

Possible Constitutional challenges
Possible Constitutional challenge included: 1) the re-direction of provincial powers to the national level, i.e., the circumvention of the powers of provinces, which reduced the health function to that of an agent for the NHI; 2) the establishment of government components without the requisite powers or permissions to do so; 3) the irrational prohibition of medical scheme coverage for benefits offered through the NHI; 4) the elimination of social protection offered to members of medical schemed through the Medical Schemes Act; and 5) the removal of the tax rebates for contributions to medical schemes.

Conclusion
The SAOU urged to not fix what was not broken – optimise it. Focus should be on what was controllable. The PHS should be optimised. Calmness needed to be established regarding NHI planning. Synergy and symbiosis needed to be created. Affordability was paramount.

Discussion

Ms Gela noted that there were a lot of things in the health system that needed to be fixed. There had been many changes in public health facilities – a lot of improvements had taken place since the end of apartheid. NHI was important to balance the system and what people were expecting. It was right to implement NHI in the country to ensure that everyone benefitted equally and had access to equal services. There needed to be one health system, everybody had the right to healthcare.

The presenter’s anxieties about NHI destabilising the medical scheme industry were noted. Clause 33 of the Bill stated that only once NHI was fully implemented, would medical schemes be expected to provide complementary cover. Clause 57 spoke about the phased implementation of NHI. Once the NHI was implemented, what was SAOU’s opinion of people insuring against healthcare costs twice? Would that not perpetuate the current inequalities, thereby threatening achievement of universal health coverage? If SAOU projected that tax increases of between three and five percent were required to fund the NHI, what did SAOU propose was the cost of NHI? Had SAOU done a costing exercise to determine this?

Could the presenter indicate which organisations in the medical industry were challenging NHI? The Committee had received presentations from various industry players. The impression the Committee had was that the organisations had made proposals on how the Bill could be enhanced and not that they would “change” the NHI.

Ms E Wilson (DA) stated that a broad definition of NHI was “broad access for all to quality healthcare”. Did SAOU agree that everyone in South Africa already had access to free healthcare as “they could go to any public hospital or clinic for care at any time” – depending on if the facility was open? Her understanding was that South Africans currently had access to healthcare. The issue was the quality of healthcare that was provided – that was the failure of health in South Africa.

The problem highlighted by the presenter was that NHI was reliant on tax increases and there was a very small tax base in South Africa. People had access to clinics and hospitals in the country “free of charge”. The fact that the quality of healthcare had deteriorated was the issue. She requested SAOU’s comment on this.

Mr Munyai responded to the mention of Deputy President David Mabuza’s routine medical trip to Russia. He believed that the health of the Presidency and Deputy President was of national security. He stated that freedom of choice was a critical aspect of democracy. South Africa had a bilateral agreement with Russia; the Deputy President would have used that platform in the context of international relations. It was “not a sign of less confidence of any system within South Africa”. He did not think that the presenter’s mention of this in his presentation was “kind”. The actions of the Deputy President did not mean that there was less confidence in South Africa’s healthcare system.

The two-tier system, that currently existed in South Africa, was broken. The two-tier system benefitted the rich – that was the problem. That was why NHI was needed.

He asked that Mr Klopper clarify who the participants were in the studies that were presented where implementation of the universal health coverage programme was seen as a reason to emigrate. Why was emigration used as a threat, when there were new progressive policies that needed to cover all South Africans? Where would these people be emigrating to, given that most countries were implementing universal healthcare policies? What was their reasoning for opting to emigrate?

SAOU seemed to believe that the proposed reform of healthcare in South Africa sought to destabilise the private sector – this was “subjective of reality”. He asked that Mr Klopper point out exactly where that was articulated in the Bill.

Slide seven mentioned the medical schemes. SAOU seemed to believe that the high cost of healthcare, which led to the lack of access to healthcare services by the majority of South Africans, was acceptable – why? Could SAOU clarify how healthcare could be made accessible to South African residents, if everyone endorsed such “indirect exclusion” and healthcare costs remained so high?

What caused the lack of growth of membership in the medical schemes industry? He knew that there was a fear in South Africa – “fear of democracy, fear of change”. In the wake of democracy, people sold their assets and left the country. “Now they were poor in Australia and regretted selling their farms”. He requested comment on this.

Mr Sokatsha noted Mr Klopper’s concern about government’s lack of response to the recommendations made by the HMI. Did the HMI, consider universal health coverage and the NHI Bill throughout its investigation or not? He asked this as universal health coverage, as proposed in the Bill, sought to ensure financial protection for all, not just for one sector at the expense of the other. For example, how did the proposed risk adjustment mechanism and mandatory participation respond to the health financing and protection needs of the entire population? SAOU seemed to be proposing that South Africa continue along the path with a fragmented and inequitable health system. Did this mean that Mr Klopper supported the position that the State must not do anything to address the historic inequalities that categorised the health system, to the detriment of the poor and vulnerable?

Could Mr Klopper indicate the organisations that challenged NHI on various grounds? The Committee had received presentations from various industry players. Organisations had made proposals on how the Bill could be enhanced. The Committee had not got the impression that the organisations would challenge the NHI. He did not know where the issue of “challenging the NHI” was coming from.

The Chairperson stated that SAOU had argued that the average tax rate for NHI would have to increase by three to five percent to be able to fund the NHI. The Committee had heard and read similar statements from the private healthcare industry, where some stakeholders were using the medical schemes current Prescribed Minimum Benefits (PMBs) expenditure to project NHI costs. This had included double counting of NHI costs, which he believed was technically inaccurate. He asked that Mr Klopper note what the HMI said about the unexplained utilisation and increase in PMB expenditure. He asked that Mr Klopper email the technical paper, which explained what informed the three to five percent, to the Committee. The Committee wanted to understand what assumptions were used in the technical analysis. What informed the actuarial and/or econometric modelling to enable Mr Klopper to make this conclusion? Were these assumptions based on health financing or economic policy positions within the White Paper and NHI Bill or was SAOU introducing new policy positions? What was SAOU’s views on clause 49 of the NHI Bill and chapter seven of the NHI White Paper?

He requested clarity about what was meant about “quality” staff, being a separate point made in the presentation. He asked for Mr Klopper’s interpretation of the difference between “quality staff” versus “non-quality staff” especially in the context where South African healthcare workers were highly regarded and sought after globally. He was concerned that the presentation seemed to conclude that the medical schemes industry was performing optimally and should be leveraged for NHI. What was SAOU’s awareness of the HMI Report, and the flaws identified in the functioning of the private health sector. If Mr Klopper was aware of this, was his proposal that the challenges be continued into the NHI environment? He noted that the presentation had only covered members of the Government Employees Medical Schemes (GEMS) in the public health system. Was Mr Klopper proposing that it was fair to exclude members of other medical schemes from being included in the public health system?

Responses
Mr Klopper would attempt to address some of the issues that were raised. The intention of the submission was not that every point be agreed on by the Committee. As a democracy, people were entitled to have different opinions.

In fact, as stated by Ms Wilson, South Africans did have access to healthcare. The problem was that it was not of the same quality. Various people had assisted SAOU with the funding models. He offered to provide their names to prove how those calculations were made. Professor Jannie Rossouw, Head of the School of Economics and Business Sciences at the University of the Witwatersrand, as well as Professor Alex van den Heever, Chair in the field of Social Security Systems Administration and Management Studies at the Wits School of Governance, had provided input on the matter. SAOU had participated in the Federation of Unions of South Africa (FEDUSA) broader public debate on this. All other unions had been included in this from the public sector to ensure that they had a representative point.

The issue of not having access to quality healthcare was one that needed to be addressed. There were various options to fund the NHI. It could be in the form of tax rebates, increased personal tax, levies, or increased corporate tax. The reality was that NHI in its current form was going to be expensive. It was not affordable for the country at that stage. This was evident in that the country was battling with Eskom on how to deal with its debt. There were perceptions of inequalities between the private and public healthcare sectors which needed to be addressed at all costs. SAOU believed it was possible to do that.

There were many organisations that were challenging the NHI; he did not think he needed to mention their names. SAOU had been in contact with some of them. SAOU preferred not to be a “challenging organisation”. SAOU preferred to look for a “win/win” situation. SAOU was willing to sit down at the opportune time and discuss how to address the issues. The day of coming together was approaching. It was not only a political matter that could be discussed by the Parliamentary Portfolio Committee, but it was also time that all stakeholders sat down together to decide how to deal with the matter. There were gross inequalities that needed to be addressed and needed to be addressed as soon as possible. It had taken 25 years to get to that stage. SAOU was not stating that the country did not need NHI. The country needed NHI in an adapted form to create a win/win situation.

In response to the question raised by Mr Sokatsha, SAOU agreed that the state should do anything in its power to address current inequalities. It would not be fair to expect the 5.5 million taxpayers to carry everything at that stage. The 5.5 million taxpayers were prepared to contribute, but it needed be seen as a win/win situation.

He had spoken to some of the medical schemes, not all medical schemes had made proposals. The medical schemes were hedging their bets at that stage to see in which direction the matter was going. The fact that there were remarks made…

The Chairperson interrupted Mr Klopper.

The Chairperson lost connection.

Mr Klopper lost connection.

The Chairperson asked that the Secretary assist in helping Mr Klopper regain connection.

The Secretary was unable to contact Mr Klopper.

Closing Remarks
The Chairperson noted that there were Members who still wanted responses to their questions and Members who had wanted to ask additional questions. He proposed that the Committee communicate written questions and request written responses from SAOU.

Mr Munyai stated that the Committee should avoid a situation where SAOU would be excluded based on technicalities, as SAOU might go to court and say that “they were not given an opportunity”. An attempt should be made to find time for SAOU to come back to the Committee. The Bill was highly contested; any technical issue might be used “as evidence” that the Committee did not give everyone equal opportunity. He asked that this sensitivity be applied.

The Chairpersons said that Mr Munyai’s caution was well-noted. He had already asked the Secretary to write to SAOU, ask for their responses, and inform Mr Klopper that attempts were made to contact him after he had lost connection from the platform.

He noted the requests for follow-up questions from Dr Havard and Mr Munyai. Members were welcome to forward follow-up questions to the Secretary.

He reminded the Committee that they were meeting the following day with SAHPRA, the Committee would also adopt the oversight reports and previous Committee meeting minutes.

The meeting was adjourned.
 

Documents

Download as PDF

You can download this page as a PDF using your browser's print functionality. Click on the "Print" button below and select the "PDF" option under destinations/printers.

See detailed instructions for your browser here.

Share this page: