South Africa is underachieving on health outcomes compared to the resources deployed in the sector, with the dual public and private health systems posing a big challenge. Covid-19 has exposed vulnerabilities but also provided opportunities to nurture relationships that are needed to find solutions. Progress has been made in building capacity to support a new national health insurance (NHI). However, Dr Nicholas Crisp, Acting Director-General of the National Department of Health (NDOH) and NHI Fund Developer, contends that we still have some way to go.
South Africa continues to produce relatively poor health outcomes, despite significant expenditure on healthcare. Global comparisons of health outcomes use a range of indicators – like crude death rate, life expectancy, infant mortality rate, and maternal mortality rate – to provide useful temporal insights to changes over time, as well as geographical insights into outcomes between jurisdictions or countries.
In 2020, Statistics South Africa reported the country’s life expectancy to be at 64 years, up about 0.5% from 1991, and a significant improvement over the 53 years recorded in 2005, as a result of the disastrous management of HIV and Aids. By comparison, Brazil’s life expectancy was 76 years in 2019. In Africa, Rwanda, Kenya, Liberia, and Malawi compare favourably with South Africa, granted that health services are not the only factor influencing life expectancy, but they do impact directly on mortality.
Examination of reductions in child and maternal mortality rates, which are crucial to improving life expectancy, shows that child mortality has declined substantially in the past decade. South Africa’s under-5 mortality rate is reportedly at 35 deaths per 1 000 live births for 2019. OECD and North American countries’ under-5 mortality rates range between six and seven, Bolivia around 26 and Brazil 14 deaths per 1 000 live births.
South Africa’s maternal mortality rate, in the order of 119 per 100 000 live births, is good in comparison with the rest of Africa but hardly compares with France at eight, Germany at seven, Greece at three, Malaysia at 29 and even Guatemala at 95 (2017). This is despite the reputedly highest Caesarean section rate in the world of around 73% of deliveries among private patients. A 2015 World Health Organization (WHO) statement asserted that rates above10–15% conferred no further benefit in reducing maternal and perinatal mortality. There are obviously significant problems with obstetric care in the country.
The other half of the outcome equation comprises inputs and processes. Two measures are frequently quoted, percentage of GDP and per capita spending. South Africa spends around 8.5% of GDP on healthcare (depending on the data source). The USA spends around 17% of their GDP on healthcare. At the other end are countries such as Republic of the Congo (2%), Ghana (3.5%), and Malaysia (4%).
At the top end of the global spectrum of health consumption expenditures per capita (US dollars, 2018) are the United States $10 624, Switzerland $9 870, and Germany $5 472. By comparison, South Africa spent $526 and the Democratic Republic of the Congo a mere $18 per capita in 2018. Some countries with relatively small percentage spend to GDP and lower spending per capita than South Africa, have consistently better health outcomes.
Why is South Africa not performing better? And what can we do differently to improve impact for the investment that we make? Several studies conclude that, at a macro level, health outcomes are highly responsive to healthcare investment. However, it is where that investment is made that matters and South Africa needs to invest in the basics and not sophisticated high-end interventions.
Perhaps the most pressing challenges facing the domestic health sector are the dramatic inequity in health resource distribution and the high proportion of spending on human resources. Government spending on health was over R256 billion in 2019/20, equivalent to about 4.2% of GDP, with the remaining half of the spending through medical schemes, various top-up options and out-of-pocket spending. However, the public spend caters for about 85% of the population and includes a host of public health programmes, such as port health and malaria control as well as the costs associated with research and teaching most public health professionals. In the public sector, perhaps understandably, at least 60% of spending is on remuneration of employees, systematically crowding out infrastructure and equipment maintenance, medicines and other commodities.
The inequities of the parallel health systems are stark, but they also tend to conceal geographical distribution issues and other disease-specific needs. The bad pockets of service are really bad, and they will not improve without targeted investment.
Covid-19 wake-up call
The Covid-19 pandemic has exposed these and other vulnerabilities within the sector. The health and wellbeing of everyone has been affected. Loss of jobs, increased stress due to isolation, death and illness of friends and family is commonplace. Furthermore, the lockdown and fear of healthcare spaces have led to the under-utilisation of services. People with chronic disease and some new acute conditions have been neglected as a result. Fortunately, there were some positive impacts as road traffic trauma and other violent trauma decreased and some people reduced their alcohol and tobacco intake.
The societal lesson of Covid-19 has been that our health is a collective challenge and not an individual privilege for the few with financial means. Every infected person creates risk for everyone else.
The response has been almost unanimously positive. Partnership and collaboration became the order of the day. Covid-19 has forced public authority providers across provinces to work together and has united the public and private providers against a common enemy. The digital harmonisation and capital infrastructure improvements that have been effected to manage Covid-19 are just two immediate opportunities that were seized.
Sector strengthening by learning from others
There are still many opportunities to strengthen the health sector, notwithstanding the economic slump. South Africa’s landscape is so different that it is difficult to identify a mentor nation or to assume lessons from other countries.
However, we take solace from recognising that no country’s health system is without problems, and all are trying to improve what they can. It is notoriously difficult to objectively compare health systems and pronounce on their relative rankings.
The tendency is to look to the West and quote examples from the wealthier 37 members of the OECD nations, but it is to Mexico, Chile, Costa Rica, and Colombia in the OECD family, and Asian Tigers like Malaysia and Thailand, that South Africa might look for ideas for a more effective healthcare system.
Today’s buzzwords are ‘universal health coverage’ (UHC), which the WHO defines thus: “UHC means that all people have access to the health services they need, when and where they need them, without financial hardship. It includes the full range of essential health services, from health promotion to prevention, treatment, rehabilitation, and palliative care.” Some claim that South Africa already has UHC, but that is patently not true, otherwise there would not be one in 1 000 pregnancies leading to women dying in childbirth.
The World Bank reports that at least 111 countries are on the way to UHC, with countries varying in their mix of service coverage and financial protection for a given level of UHC. However, the statistics, tables and graphs do no justice to the experience of the populace because averages are just not good enough for those on the left of the curve.
Some countries have done exceptionally well on their UHC journey. Their whole solution may not be appropriate to South Africa, but there are lessons to incorporate in our reforms from others.
For example, every Mexican citizen is guaranteed no-cost access to healthcare and medicine according to the Mexican constitution. Mexico’s UHC efforts began in 2004, and by 2012 Mexico had enrolled 52.6 million previously uninsured Mexicans in public medical insurance programmes. The changes and the results are widely published, and Mexico is hailed as a leader in health systems reform.
Socioeconomic development in Malaysia over the past few decades has led to the improvement and expansion of the country’s public healthcare system. Infant deaths have been reduced by more than 90% – from 75.5 per 1 000 live births between 1963 and 2016 – and life expectancy in Malaysia has increased to about 75 years.1 The improvements are systemic but we can, for example, learn from their newly introduced no-fault compensation method of dealing with medico-legal and iatrogenic injuries.
Another country to learn from is Thailand. The country has had sustained periods of political instability and the economy has underperformed while they worked on their health system. Thailand’s policy on UHC, however, has made good progress since 2002, to a point where every Thai citizen is now entitled to essential health services throughout their lives. Thailand’s UHC is financed predominantly by general government taxation because health insurance premiums are unaffordable to large numbers of poor people. They found that collecting premiums from people who should be able to contribute was logistically difficult and politically challenging. A specific lesson that South Africa has taken from Thailand is from their well-coordinated district health systems that enable individuals to seek care or referral at health units close to home.
Building the NHI
South Africa’s dual health system is neither sustainable nor achieving the desired return on spending (investment). This must change. Commitment to UHC as a concept is easy, but making changes that impact comfort zones, privilege, and vested interests is another thing entirely. The South African choice for addressing UHC must address the gross inequity that has deepened in the past 25 years and must contribute to social cohesion through social solidarity. The premise is that the country has the resources to provide adequate quality care for all and that the challenge is rather how to apply those resources smartly and fairly.
The policy choice is for a single purchaser model delivering services through a purchaser/provider split. Simply put, the aim is to bring all current health funding to the NHI Fund of which the institution will pay public and private providers to provide healthcare benefits to people in the country because they need them and not based on whether they can pay.
This is clearly a massive reform and every word and concept is loaded. Like all far-reaching change, the NHI starts with a vision and the recognition of the threat of change. Change needs to be introduced in bite-sized chunks and requires transparency, with technical jargon simplified for the lay-public. It must also be approached with enough local flexibility as is required to accommodate a heterogeneous environment.
The NHI Bill is still in Parliament and will be debated soon. While that process evolves, the NDOH will establish the nucleus capacity to manage the functions of the NHI administration, including the Fund. Government’s approach is to work together with other stakeholders. This was clearly articulated when the president established a NHI War Room to support the Minister of Health and personally established a Social Compact with society at a national forum. The NDOH will continue in this vein as it develops quality, benefits, provider accreditation, digital capability and manages the transition, among other elements, of the reform. Much progress has already been made.
A National Health Quality Improvement Plan (NHQIP) has commenced. It involves public and private providers in designated quality hubs in a structured programme that will allow for 18 sites to be Quality Learning Centres (QLCs) in due course.
A Primary Healthcare Benefits Framework has been developed that builds on the updated Clinical Guidelines and which is harmonised with the evolving Prescribed Minimum Benefit (PMB) project of the Council for Medical Schemes (CMS).
The hospital benefits approach has been thoroughly researched and the approach will be consulted with appropriate role- players in due course.
Provider Accreditation starts with standards compliance. The Office for Health Standards Compliance (OHSC) has developed inspection tools to support the published minimum standards and will be inspecting all the NHQIP quality hub establishments in addition to their routine programme. The NHI Branch will be working on further elements of accreditation and the systems to manage provider engagement. This will be done with smaller groups of private and civil society stakeholders with unique interests.
The digital capability to support the NHI has been under development for years. The backbone Health Patient Registration System (HPRS), which has registered around 55 million users so far, has been critical to the Electronic Vaccine Delivery System (EVDS), tracking of vaccines, and who is vaccinated. The Master Facility List (MFL) of providers has been significantly improved during Covid-19 and many free- standing databases and systems are now operating in a single system.
These are some of the good-news stories of progress with the foundation for NHI. At the same time various transition improvements are under way. The CMS is working with Treasury and other financial roleplayers and the NDOH to tighten regulation of concerns raised in the Health Market Inquiry and in preparation for NHI.
The country needs as many roleplayers and stakeholders as possible to engage with these reforms. Some interaction may be at establishment level, others in communities. At national strategic level interest groups like the Health Workgroup of Business for South Africa will continue to play an important role in the evolution of details.
What companies can do to strengthen the healthcare sector
Dr Crisp intimated that trying to make an impact on big national systems and policies is frustrating for private roleplayers as they do not have much chance to interact with all the prescriptions of state machinery. However, because the public services have had their budgets slashed and it is difficult to play catch-up with maintenance projects, CSI could look at adopting local facilities and responding to their specific needs. Big and small contributions are always welcome at local level, and CSI expenditure can make a direct and positive impact in this regard. A good way to use small donations constructively is to support hospitals such as the Red Cross Children’s Hospital, which have well-established Trusts, or organisations like Gift of the Givers, which invest directly in refurbishing hospital wards or drilling boreholes where there is poor water supply in facilities. This makes a huge difference at facility and services level.
Fraud and corruption
The Covid-19 pandemic has highlighted the very best and the very worst of humanity. Our responsibility is to focus on building what is good and protecting against what is bad. Lessons on how the public and private health sectors can work together must be harnessed and lessons on corruption and greed must provide warnings of what to avoid. There probably will not be ‘the other side of the pandemic’ and life today is the new normal.
Both public and private sectors are exposed to fraud (dishonesty) and corruption (lack of integrity typically involving bribery and abuse of a position of trust for dishonest gain). This is very visible in the public sector because public money is involved, but it has no lesser impact whether it is the public or private purse being defrauded or corrupted.
The NDOH, together with the Special Investigations Unit (SIU) and others, already has a Risk Management Framework for NHI and the digital architecture of the NHI is designed with a range of risk management and detection features. The NHI entity will have an Anti-fraud and Corruption Unit tasked with acting on suspicious activity and working with appropriate law enforcement agencies.
South Africa’s unique distortion lies in the gross inequity of society. This is mirrored by the proportionate size of the private healthcare spend in the country. The country’s history demands that equity is addressed very directly.
NHI should be affordable based on the relatively high GDP spend on healthcare and efficiency opportunities to redirect money from the significant overservicing in the private sector, and the high administrative cost associated with a complex system. The entire system must be reformed simultaneously, and this requires that public and private stakeholders set aside differences and build on the common foundation that Covid-19 has shown is possible.
- World Health Organization. (2018). World Health Day 2018 – Lessons from Malaysia on Universal Health Coverage.