SA Health Dept’s unrelenting push for Certificates of Need could wreck its already fragile healthcare sector.

In June 2022, the High Court in Pretoria declared Sections 36 to 40 of the National Health Act – which would give rise to the implementation of the much-contested Certificate of Need (CON) – unconstitutional. This ruling by Acting Judge Thembi Bokako demonstrated common sense and pragmatism– virtues that are virtually non-existent in the context of legislative governance in South Africa. After this ruling, the Department of Health (DoH) predictably applied to set aside this judgement handed down in favour of Solidarity, a leading South African trade union which lodged the application against the Certificate of Need – a cornerstone of the proposed National Health Insurance (NHI) – to protect the constitutional rights of health practitioners across the country. The DoH’s application to scrap Judge Bokako’s landmark ruling has been postponed pending the Constitutional Court’s decision on whether to ratify the ruling. The end result of this case is consequential in that, if successful, the DoH’s application would grant government the power to expropriate medical practices and establish regulations that will negatively impact the entire population and irreparably devastate the healthcare sector and medical practitioners. – Nadya Swart

Certificates of Need – the road to medical slavery and chaos

The National Health Act 2003

The Certificate of Need (CON) provisions in the National Health Act 2003 will require doctors to apply for CONs for everything they do and plan to do, including opening a practice and medical equipment they want to use.

Healthcare providers will require CONs to:

  • Establish, construct, modify or acquire a health establishment or health agency.
  • Increase the number of beds or acquire prescribed health technology at a health establishment or agency.
  • Provide prescribed health services.
  • Continue to operate a health establishment or health agency 24 months after the Act took effect.
  • Granting of CONs will be conditional on applicants working in the area to which the certificate applies.

Read more: Healthcare sector celebrates its release from Certificate of Need red tape

Infringement of constitutional rights

Solidarity challenged the CON provisions arguing they infringe on the right of health practitioners to practise their profession. 

In June 2022, the Gauteng High Court (Pretoria) agreed and declared the CON provisions (Sections 36 to 40 of the National Health Act 2003) invalid.

Acting Judge Thembi Bokako said the CON scheme permitted the director-general of health to view healthcare personnel as “inanimate pawns in pursuit of the state’s objectives.” According to the judge, the Act’s provisions infringed on six constitutional rights:

  • The right to have one’s dignity respected: CONs will override work choices. 
  • The right to freedom of movement: CONs will compel people to work in places against their choice.
  • One’s right to choose an occupation.
  • The right against arbitrary deprivations of property: Refusal to renew CONs will leave health providers with property and equipment they can no longer use.
  • The right against expropriation without compensation: CONs could force private providers to share their human resources and facilities with the public sector.
  • The right to healthcare services: CONs threaten existing health access. The state cannot meet its obligation to achieve the progressive realisation of the right to healthcare by depriving those who currently enjoy access to care.

Judge Bokako’s order in the Pretoria High Court declaring the CON provisions of the National Health Act to be invalid must be confirmed by the Constitutional Court to have any force. No doubt, Solidarity has lodged an application with the registrar of the Constitutional Court for confirmation of her order.

The National Health Department is reportedly challenging the High Court ruling in the Constitutional Court.

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Turning doctors into slaves

CONs will empower government officials to dictate where doctors work and what services and equipment they may use. Doctors will become slaves of the state. 

The Health Department aims to use CONs to equalise healthcare between, in its view, over-provided cities and under-provided rural and poverty-stricken areas. It believes there should be less healthcare in over-serviced (cities) and more care in under-served poor and rural areas. The aim is to ensure the vulnerable members of society, and those living in remote areas, receive care.

Attempts to equalise economic activity, including healthcare delivery, between wealthy and poor areas will fail. Economic activities are never evenly spread over a geographic area, whether a rural area, province, or country. Cities produce more goods, services, and healthcare than small towns and rural areas. 

The availability of healthcare depends on whether it is economically viable to provide it. Underserved areas may have too few residents, or residents may be too poor to support medical practices. Rural and poor areas will always be underserved compared to wealthier towns and cities. 

The CON provisions of the National Health Act will compel doctors, specialists, and hospitals to apply for CONs within 24 months of the taking effect of those provisions. The Health Department will receive thousands of applications to approve CONs for medical establishments, beds, and diagnostic equipment. On what basis will the Department decide which applications to approve? The only outcome is bureaucratic chaos. 

To reduce the services provided, the Health Department will not approve CON applications in areas it believes to be over-serviced. Existing medical care providers who have their CON applications refused will have to close their practices. They will end up with properties and medical equipment they may not use. 

If applied as intended, refusing CON applications will reduce healthcare in wealthy areas, depriving patients of health services previously available. It will not result in more healthcare in poor and rural areas. CONs cannot make medical care economically viable. Residents in underserved (rural and poor) areas will remain dependent on the dysfunctional public health system. 

In a free society, doctors set up practices where they wish. Doctors who serve their patients well will prosper – those who do not will go out of business. Private healthcare is not the problem. South Africa’s healthcare problem is millions of poor people who cannot afford healthcare.

Instead of turning doctors into slaves by controlling where they may and may not work, the government should purchase care for the needy from private doctors. This would relieve it from providing healthcare, building and maintaining hospitals, and paying doctors and nurses. It could then devote its health budget to purchasing care for the needy.

Buying healthcare for the needy from private providers will incentivise them to establish medical practices in underserved areas. Instead of emigrating, doctors may decide to remain in the country.

Healthcare realities

Millions of South Africans are too poor to pay for healthcare. Only a growing economy that creates jobs that enable people to pay for housing, food and healthcare will remedy this. The government must focus on removing the countless laws and restrictions that hinder economic growth and wealth creation. Instead of restricting healthcare via CONs, it must remove all regulations restricting and delaying healthcare provision, raising costs.

South Africa needs more entrepreneurship by private providers and less planned bureaucratic chaos.

The Constitutional Court will determine whether South Africa’s doctors will become slaves of the state or whether they will practise their profession free from government compulsion.

Johan Biermann is an independent policy researcher. He is the author of South Africa’s Health Care Under Threat and Undermining Mineral Rights – An International Comparison, both published by the Free Market Foundation. The views expressed in the article are the author’s and not necessarily shared by the members of the Foundation.

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