NHI vs medical aids: Parliament’s legal team warns of a big constitutional trap
The Parliamentary Legal Services (PLS) has briefed the portfolio committee on health, providing feedback and insights on the National Health Insurance (NHI) Bill currently being processed by the government.
The state legal advisors have highlighted a host of potential constitutional traps in the current composition of the bill, including some inconsistencies in wording, attributing the incorrect powers to ministers that should be within the presidency, as well as instances where people’s rights to access healthcare are under threat.
The NHI seeks to make the government the single purchaser of healthcare for everyone in South Africa. Through the NHI Fund, anyone wanting to access healthcare will have to register with the fund and follow very clear lines of referral to get the medical attention they need.
This would lead to a significant and fundamental shift in South Africa’s healthcare landscape, effectively bringing both private and public healthcare under the same state-controlled umbrella, and would see industries like health insurance and medical aids largely fall away, except for very specific circumstances.
One of the biggest points of pushback against the bill has been on this – the “removal” of medical aids from the picture.
In terms of the proposed bill, medical aids would not be allowed to cover anyone for medical care that is covered by the fund.
The only time patients would be able to lean on medical aid cover is when their procedures are not covered by the NHI, they fail to follow the lines of referral, or the treatment they seek is not deemed medically necessary.
In these cases, patients will have to fund their own healthcare, either through private insurance, medical aid or out-of-pocket.
Unfortunately, the bill’s wording severely restricts what private insurance and medical aid are able to fund and makes no provision for what people should do should they opt not to use the NHI, so uncertainty around this persists.
Clause 33 of the NHI Bill provides for the role of medical schemes as follows:
“Once National Health Insurance has been fully implemented as determined by the Minister through regulation in the Gazette, medical schemes may only offer complementary cover to services not reimbursed by the fund.”
However, the PLS said that this aspect of the bill could push the proposed legislation into a constitutional trap.
The state law advisors said that the NHI bill does not provide much detail on how medical schemes will operate once the bill is enacted. Further, it is not clear how current medical scheme users will access healthcare services during the phased implementation of the bill.
“This creates legal uncertainty. The NHI is funded by mandatory prepayment. It is not clear if medical scheme users will be required to make the mandatory prepayment while still paying for their medical scheme contribution while the NHI is not fully implemented,” the PLS said.
“Further, as the full benefits available on NHI have not yet been determined, it is unclear to what extent it will affect the rights of those currently receiving medical treatment via medical schemes.”
The PLS said that the role of medical schemes would be fundamentally altered by the NHI, noting that some submissions on the bill have argued that dictating to users where they can go and what treatment they can get violates the right to access to health and the freedom of association.
“The Constitution requires that the state must take reasonable legislative and other measures, with its available resources, to achieve the progressive realisation of right including in respect of access to healthcare services.
“If medical scheme users suffer a reduction in access to healthcare as a result of the implementation of the NHI, this will give rise to a constitutional challenge based on a violation of section 27 of the Constitution,” the advisors said.
Other constitutional pitfalls the proposed scheme could face surround removing the rights of asylum seekers (including their children) from accessing the scheme, the stringent lines of referral that need to be followed without any flexibility for those who may not be able to follow them, as well as competition issues, where the bill seeks to exempt the state from standing competition laws.
The PLS also flagged the vagaries around the funding of the NHI, saying that the bill does not indicate who will be required to make the “mandatory prepayments” to fund the system, aside from it being “compulsory according to income levels.”
The Department of Health has floated the idea of a payroll tax or surcharge to fund the scheme, which the unspecified groups will not be able to avoid. However, it has been argued that it will be left up to individuals to decide whether or not to use the NHI to fund their healthcare – thus, access to the NHI is not restricted.
Regardless, the PLS said that “the payment frameworks are unclear” in the bill.
Read: Government preparing for onslaught of NHI legal challenges
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