SA hell bent on healthcare centralisation: poor idea to imitate NHS – Ivo Vegter

Despite universal healthcare being a splendid goal, the effective delivery of such an ideal in South Africa is questionable. The article below explores why the government monopoly on healthcare, as the NHS hopes to obtain, is a bad idea in SA – reducing standards of healthcare, increase state burdens and potentially leading to the rejection of those in need of medical care. South Africa cannot efficiently achieve such centralisation when it only has a fraction of the necessary resources – thus, imitating the NHS would not yield desired results. – Carmen Mileder

Why emulating Britain’s NHS is a bad idea

By Ivo Vegter

The broad-stroke aims of the National Health Insurance (NHI) Bill, on which the Parliamentary Portfolio Committee on Health recently concluded clause-by-clause deliberations, appear laudable.

It aims to provide a comprehensive healthcare service to all South Africans, free at the point of delivery and based on clinical need and not ability to pay.

The Constitution guarantees everyone the right to have access to healthcare services, and says no one may be refused emergency medical treatment. The NHI Bill goes significantly further, guaranteeing everyone not just access, but to substantive healthcare services, not just in emergencies, but for most medical needs.

In principle, universal healthcare is a noble objective, of course. Nobody wants to see anyone denied medical care simply because they cannot afford it. The question is whether the NHI Bill, as contemplated, will deliver this.

The health minister, Joe Phaahla, brushed aside concerns and objections raised in the portfolio committee hearings, and offered no answers about how the NHI would be funded, how it would be phased in, and how this would affect private medical care.

He did, however, indicate that he would soon jet to the UK to learn how to implement the NHI along the lines of that country’s National Health Service (NHS).

Junket

It seems rather late in the day for the Health Ministry to inform itself about how to implement a scheme first conceived in 2010 and written up as a Bill in 2018. Phaahla did not say who would pay for this fact-finding mission, and whether or by what process his new discoveries would be subsumed into the NHI Bill.

It doesn’t take a junket to the UK to learn some salient points from the NHS, however.

Perhaps the key lesson is that the budget for the NHS exceeds £180 million per year, to serve a population of 68 million. Scaled to South Africa’s population of 61 million, that works out to R3.4 trillion, and the NHS isn’t even the most expensive universal healthcare system in Europe: France, Germany and Sweden all spend even more.

To put that in perspective, based on the latest quarterly GDP data, South Africa’s annual GDP is around R4.6 trillion.

Although Phaahla’s funding proposals range from vague to non-existent, the intention appears to be to devote no more than 8.5% of GDP – the amount government spends on public healthcare at present, plus the lesser amount private individuals pay towards medical aids – to the NHI.

That adds up to about R395 billion, which is less than one eighth of what the UK spends on its NHS.

It is foolhardy to try to build a national healthcare system in a developing country with limited resources like South Africa, by modelling it on a far more costly system in the rich world and which is visibly failing.

Decline

Despite the staggering cost of the NHS, it is beset with problems. Its performance has been in steady decline for years, long before the shock of the pandemic plunged the NHS into crisis. Key workers including frontline nurses and ambulance personnel are striking for better conditions and pay.

In November 2022, the NHS managed to admit, transfer or discharge only 68.9% of accident and emergency (A&E) patients within the target of four hours. This is the lowest reported performance since data collection began. The 95% standard was last met in July 2015. Patients are dying in ambulances queuing at A&E doors.

In the largest, full-service A&E departments, this figure is even lower, at a mere 54.5%, also the lowest ever recorded. In October, over 40 000 patients had to wait over 12 hours between being admitted and a bed becoming available.

Some patients have had to wait over 40 hours for an ambulance.

In cancer care, average waiting times have doubled in the last four years. Patients are meant to start treatment within 62 days of an urgent doctor’s referral. Only 61.5% of them do. The target of 85% was last met in 2014.

As at September 2022, more than 10% of the UK’s entire population – 7.1 million people – were waiting for routine hospital treatments. That is the highest number since records began. Of those, 400 000 have been waiting for more than a year, and more than 2 000 for over two years, despite a targeted maximum waiting time of 18 weeks – which in itself is absurdly long.

Thirteen thousand hospital beds in the UK are occupied by people who no longer need to be in hospital. The NHS is also under-staffed, by 130 000 posts, or almost 10% of its planned workforce.

NHS maintenance backlogs are growing, too, more than half of which present significant risks to patient care.

Crisis

Matthew Taylor, the chief executive of the NHS Confederation, which represents the healthcare system in England, Wales and Northern Ireland, was quoted in The Guardian in August 2022 saying the NHS is “in its worst state in living memory”.

The paper also quoted Alastair McLellan, the editor of Health Service Journal, who said: “There is not one area of NHS provision that isn’t really struggling … There is literally nowhere where it isn’t bad, and in some cases really bad.”

As a sole buyer of pharmaceutical products, as envisaged by NHI, the NHS is also routinely getting scammed. Despite the view that a single large buyer has the power to negotiate better prices, the NHS has been overpaying for some drugs by as much as 700%, because there is no process for price discovery in a monopsony market, and collusion among suppliers need not be explicit for them to raise prices way above what a competitive market would offer.

Until recently, the NHS prided itself on patient satisfaction surveys that found that in 2018, more than half of patients were satisfied with the service, while “only” 30% were dissatisfied. One might expect some level of satisfaction, of course, for a free service, no matter how poor it is.

The most recent data, however, suggests that patient satisfaction has fallen to 36%, the lowest level in 25 years, and more patients are now dissatisfied than satisfied with the NHS service they received.

Patients cite waiting times for doctors and hospital appointments, staff shortages, and insufficient government spending on the NHS as the main reasons for their unhappiness.

Model

The NHS would be an instructive model to study if one wanted to know why a government monopoly on healthcare, as the NHI hopes to achieve, is a poor idea.

It will reduce the standard of healthcare to the lowest common denominator for all. It will increase the burden on the state, not decrease it. It will exacerbate rationing and end up denying people the medical care they need by placing them on endless waiting lists.

Even in rich countries, with high bureaucratic capacity, government-funded universal healthcare systems are in crisis. The belief that South Africa can perform any better, with a fraction of the resources, is delusional.

Trying to provide healthcare to people who do not need it, because they can afford their own private healthcare, is a fool’s errand. Let’s hope the Minister pays attention. The UK is considering moves towards a mixed, decentralised system out of necessity. SA is hell bent on centralising healthcare, which would be a disaster for all.

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