Dear Discovery people
I’m reaching out following yesterday’s announcement that President Cyril Ramaphosa will sign the National Health Insurance (NHI) Bill tomorrow.
This development is disappointing and unfortunate given the significant technical and constitutional flaws in the NHI Bill and in the legislative processes for adopting the Bill. We are however well-prepared and have a clear roadmap forward, remaining firm in our stance.
Our position on the NHI has been clear and consistent throughout: we unequivocally support universal health coverage and believe that a workable NHI is central to achieving this. However, in its current form, the NHI Bill is unconstitutional and unfeasible without private sector collaboration and broader funding sources. We remain strongly of this view and will continue to fight for an NHI that is viable and to the benefit all South Africans.
I would like to share some specific, critical points on this matter, to keep you fully informed.
No impact on medical schemes for the foreseeable future
Although the Bill will be passed, full implementation of the Bill remains a long way off – up to several years or possibly decades away. In the interim, medical schemes and the private healthcare sector will continue to operate as always, without any changes to Discovery Health or the medical schemes administered by Discovery Health. In other words, there will be no impact on medical scheme members or healthcare providers across the health system.
Section 33 of the NHI Bill notes that only once the Bill is ‘fully implemented’ will medical schemes be limited to providing ‘complementary cover to services not reimbursable by the NHI’. The timeframes for ‘fully implemented’ are not clear and the benefits that will be provided by NHI are not defined. Without clear timeframes and unless the NHI provides benefits similar to those offered by medical schemes, medical schemes will continue to play an important role in the healthcare system in the long-term.
Implementation will be a lengthy process given structural complexity, potential legal challenge and the unachievable funding required
The NHI is an inordinately large and complex initiative that proposes unprecedented reforms to the health system, including extensive reorganisation of the public health sector. Considerable planning and preparation is required before it can be implemented.
Additionally, the signing of the Bill is likely to trigger a range of legal challenges focused on the constitutionality of the Bill and on the gaps in the legislative process which led to the adoption of the Bill.
Critically, the largest barrier to implementation of a workable NHI is funding. There is no funding plan as yet and given the country’s constrained fiscal position, low economic growth and narrow tax base, this can only be solved in the longer term. Such is the tragedy of a highly unequal country with muted growth. We see no scenario in which there is sufficient funding for a workable and comprehensive NHI – hence our conviction that private sector collaboration is vital, and the role of medical schemes will remain significant going forward.
Discovery remains committed to fact-based and constructive engagement but also to defending the rights of medical scheme members and healthcare consumers in South Africa
Since 2011, Discovery has focused on constructive and collaborative engagement with our partners in government, business, and civil society through every step of the NHI legislative process. This remains our approach into the future. We simply must create an NHI that is workable and to the benefit of all South Africans. At the same time, we are firmly committed to protecting the rights of our members and of healthcare consumers more broadly and will stand our ground wherever required.
Conclusion
It is understandable that President Ramaphosa’s signing of the NHI Bill may cause some uncertainty and anxiety. However, with full implementation a long way out and many matters still to be navigated in the interim, we must maintain perspective.
Let me be clear, in keeping with our values, we will do the right thing. We will ensure that our members continue to access outstanding healthcare; that the voices and contributions of the country’s world-class healthcare professionals are heard and protected; and that there is continued investment in South Africa’s public and private healthcare systems, for the good of all our country’s people.
I will continue to update you as there are further developments.
Sincerely,
Adrian