The owners of for-profit private hospitals have voted themselves to maintain high-cost-high profits health care system, in defiance of the modest call by the Minister to act in favour of health before profits. NEHAWU alleges that the refusal by private hospital companies to reduce the tariff increases, at least to the CPIX level, demonstrates once again why profit maximization in health care is incompatible with the needs of society as a whole. The organisatiion further observes in their report that much of the healthcare costs in the private health sector have nothing to do with provision of quality care, but spending on unnecessary and expensive equipment, hospital and office infrastructure and profits for their shareholders. NEHAWU does not believe however that the solution lies in another effort at regulation and calls for fundamental transformation of the sector, especially in the medical schemes and for-profit private hospital sector which command huge resources required for re-distribution in favour of the majority not the minority.
Public-Private Mix
The South African Health Review (SAHR) is an annual publication of the Health Systems Trust (HST), which has been published since 1995. The SAHR seeks to provide a South African perspective on prevailing international public health issues, to stimulate debate and critical dialogue and to provide a platform for assessing progress in the health sector.
The private sector provides care for about 7 million people or close to 15% of all South Africans but consumes more than the total expenditure by the public health sector. The per capita expenditure in the private health sector is about 8 times more than that in the public health sector. Put another way, the public health sector spends about R1000 per patient per year whilst the private sector spends about R8000. The private sector spends an estimated 5.5% of gross domestic product. In addition, this sector employs more doctors, pharmacists and dentists than the public health sector. Clearly, this level of inequity cannot be left unchallenged.
The purpose of this study is to review the research literature on the effectiveness of contracting-out of primary health care services and its impact on both programme and health systems performance in low- and middle-income countries. Due to the heightened interest in improving accountability relationships in the health sector and in rapidly scaling up priority interventions, there is an increasing amount of interest in and experimentation with contracting-out. Overall, while the review of the selected studies suggests that contracting-out has in many cases improved access to services, the effects on other performance dimensions such as equity, quality and efficiency are often unknown. Moreover, little is known about the system-wide effects of contracting-out, which could be either positive or negative. Although the study results leave open the question of how contracting-out can be used as a policy tool to improve overall health system performance, the results indicate that the context in which contracting-out is implemented and the design features of the interventions are likely to greatly influence the chances for success.
As the World celebrates 30 years of the Alma Ata Declaration that launched the Primary Health as the Pillar of Quality services, there is greater need for all of us to improve access to affordable medicines. Even in rich countries, access to affordable medicines cannot be guaranteed. Of course, the problems are much greater in many developing countries, with insufficient or no manufacturing capacities in the pharmaceutical sector. In Africa we are too reliant on other countries to provide essential medicines for us. This is not strategic and correct, as we cannot guarantee availability of appropriate technologies that truly respond to our current and emerging needs.
Private health care has been specifically targeted for interventions by the health department in the coming year, according to South Africa Health Minister Manto Tshabalala-Msimang. She said the government was paying particular attention to 'improving accessibility and affordability of private health care.' The minister said that private hospitals were also agreeing to comply with the single exit price legislation with regard to the billing for anaesthetic gases which were previously overcharged. She said that the department was building on the progress made in regulating medicine prices to develop regulations that would allow the whole private health sector to be regulated.
The South Africa Minister of Health, Dr Manto Tshabalala-Msimang held separate follow-up meetings with representatives of the private hospital industry and medical schemes in Cape Town to discuss the challenge of increasing private health care costs. The Minister welcomed the efforts that have been made by some of the private hospital groups to adjust the tariff increases for 2008 towards the CPIX. However, there were concerns from schemes that adjustments announced have not translated to any savings that can be passed on to the consumer. The schemes reported on the efforts that have been made to reduce non-health costs in the medical schemes.
The International Finance Corporation (IFC), the private sector arm of the World Bank, announced last month that it would coordinate some $1 billion in equity investments and loans to finance private sector health provision in sub-Saharan Africa. The program was explicitly linked to the results of an IFC study, financed by the Bill and Melinda Gates Foundation, which found that the private sector already provides about half of the health care in the region, and that impoverished people are just as likely as the better-off to use private providers.
The SACP is outraged at the plans by some of the big private hospital groups, including the National Hospital Network and Netcare, to hike fees by as much as up to 33% as from this year. The private health care sector is already consuming a much bigger slice of our health resources and is also making huge profits for itself at the direct expense of the majority of the people of our country, feeding like parasites on workers’ already overstretched medical aid schemes.
This report describes opportunities for engaging and supporting a well managed and effectively regulated private sector to improve the region’s health and complementary to traditional public sector approaches.