South Africa, as with many countries, is committed to achieving the global goal of Universal Health Coverage (UHC) by 2030, leaving no one behind.

National Health Insurance (NHI) is a healthcare financing system that can be used to support the achievement of UHC in a country. However, NHI is not a necessity to achieve UHC. While the structure and details of NHI can vary greatly between countries, the key aim remains to promote the achievement of UHC, ensuring that everyone in the population can access the healthcare they need without suffering financial hardship.

The conceptualisation and design of any health financing system are supposed to take into account each country’s experiences and global lessons learned in the development of systems for UHC. Specifically, health financing within a UHC system needs to be designed to provide all people with access to needed health services (including prevention, promotion, treatment, and rehabilitation) of sufficient quality to be effective and to ensure that the use of these services does not expose the user to financial hardship.

In South Africa, the key focus of the reforms is the creation of the NHI fund, which will pool both healthcare risks and funds. The implementation of NHI is predicated on creating a distinction between who purchases and who provides healthcare. This is called the purchaser-provider split. As a purchaser, the NHI Fund will not provide healthcare services, but it must pay (in full with no co-payments) for a legally defined package of health care services. Everyone must have access to this package through healthcare providers who are accredited and contracted by the Funder and meet the minimum standards for the provision of care.

Currently, patients using either the public or private healthcare systems face many challenges when accessing healthcare. Patients accessing non-hospital-based services in the public sector are required to pay user fees, depending on their income status. In the private sector, due to the lack of appropriately determined tariffs, patients are faced with co-payments. The end result is that public and private sector patients both end up having to pay out of their own pockets for health care, whether they can afford it or not.

Under NHI, patients will not be required to pay up front for the NHI package of health care services. Access to such services will be free at the point of care.

South Africa is introducing NHI to improve access to healthcare while reducing inequity and inefficiency in both the public and private sectors.

The solution lies in a unified healthcare system that places the patient’s interests first. The hope for NHI is that when anyone gets sick, the system is able to respond and address their health care needs in time. NHI aims to solve the problem of funding health care services for patients, no matter who they are.

For NHI to be successful, a strong partnership between the public and private health sectors is necessary. Resources for health care are scarce the world over, so any system of funding must be effective, efficient, and based on the health needs of the population as a whole. It must use all of the available resources in the best way possible to ensure access to health care services.

Funding is only one of the resource challenges in a health care system. Others are the availability of suitably qualified and skilled human resources, adequate infrastructure and resource management, the ability to effectively utilise health technology to improve health outcomes, quality assurance in health care services, and rigorously enforced health care standards. NHI is therefore only part of the solution for a well-functioning and properly capacitated health care system.

The National Health Insurance (NHI) Bill was introduced to Parliament in August 2019 and passed by the National Assembly on June 13, 2023. The next step for the NHI Bill is for it to be passed by the National Council of Provinces (NCOP). The NCOP will deliberate and consult on the Bill before it can be passed into law. If the NCOP approves the Bill, it will then be sent to the President for assent.

Once the President signs the Bill into law, it does not become operational until the President signs a Proclamation at a later stage. The Proclamation will state the dates on which certain parts of the Act become effective. This gives the government time to get ready to implement the law. Before signing a Proclamation, the President must determine if the system is adequately prepared for implementation, has the necessary capacity, and can be appropriately financed.

In addition, the Minister of Finance must introduce into Parliament a separate Money bill, which must be processed by Parliament as provided for in the Constitution. Only the Minister of Finance can initiate and introduce a Money Bill. A money Bill is a draught law that sets out how the government may raise or appropriate money for a particular purpose. The NHI cannot be effectively implemented without the passage of a Money Bill into law.

The implementation of National Health Insurance is a massive undertaking that will not happen overnight. It could take decades before NHI is fully implemented due to all the system changes it requires.

Patients will, in one way or another, still pay for health care services funded by the NHI. This will be done through various forms of taxation, such as personal income tax, payroll taxes, and possibly VAT. Health care funded by the NHI is not free. By making people pay for it in advance, NHI guarantees them free access to the NHI health care package of services at the point of service.

Some people may never need certain health care because they are young and healthy, but they will still be obliged to pay for it to cover the needs of those that do. For example, men do not get pregnant, so they will never need perinatal health care services or a gynaecologist. Women can never get prostate cancer, so they will never need prostate cancer treatment. The idea is that everyone pays so that everyone gets the care they need. This is why the word “insurance” is used.

It may take several weeks before the NCOP finalises its deliberations and adopts the NHI Bill. Additionally, it will take some time before the NHI Bill becomes law and many years before it is fully implemented.

The Bill currently states that, when fully implemented, medical schemes will not be able to provide cover for services that are paid for by NHI.

Since we don’t know what these services are yet, we cannot say what medical schemes will not be allowed to cover them.

Medical schemes will be able to fund health care services not covered or paid for by the NHI Fund for various reasons. At this stage, these reasons may include where a person is not registered with the NHI Fund, where a person does not follow prescribed referral pathways to obtain NHI-funded care, where a person uses a provider who is not accredited and contracted to the NHI Fund, where the Formulary for the NHI Fund does not include a particular medicine prescribed for a user, etc. The NHI Bill contains information gaps that will have to be filled in by regulations made by the Minister, so more clarity will be achieved as time goes on.

The Bill sets out many transitional arrangements that have to be made for the implementation of NHI. During this transitional period, medical schemes will continue to provide all their members with the same health care benefits as they do now.

It is important to note that there are many uncertainties surrounding the financing and implementation of NHI in South Africa. It is an entirely new development, and there are still many lessons to be learned.

Medical schemes will continue to support the government in the implementation of UHC to ensure that the health system supports all citizens equitably and fairly. Your medical scheme membership will not be adversely impacted in the immediate future, as both the White Paper and NHI Bill emphasise that the role of medical schemes will only change when NHI is fully implemented. The NHI Bill acknowledges that there is still a role for medical schemes even after the NHI is implemented.

The BHF, working with its member schemes, has embarked on many processes to improve access to care for medical scheme beneficiaries while waiting for the reforms proposed by the NHI to come into effect. Members of medical schemes don’t have to wait for full NHI implementation before they receive improved access to health care.