‘Strange’ NHI promises as Ramaphosa keeps looking for his pen

 ·24 Mar 2024

Gauteng premier Panyaza Lesufi has repeated the intention to buy 18 private hospitals in the province for the NHI – despite an expert calling the move nonsensical, unfeasible and “very strange”, given the lack of funding to do so and there being no need for it.

Writing a column for the Sunday Times, Lesufi doubled down on many of his talking points made during his State of the Province Address in February, specifically the call for President Cyril Ramaphosa to sign the National Health Insurance (NHI) Bill into law.

The president previously vowed to sign the bill into law before the 2024 elections, stating that he was “looking for a pen” to do so. The pen has proved elusive, as almost two months later, the laws are still pending.

Parliament erroneously published a media statement last week stating that the bill had been signed into law, but later retracted this. This has sparked speculation that the signing is imminent.

According to Lesufi, the NHI will provide everyone in South Africa access to “affordably-priced high-quality healthcare” – an oft-repeated line from the government that constantly neglects to specify any costs or funding mechanisms.

Responding to a question on Wednesday, 20 March, from the Democratic Alliance (DA), finance minister Enoch Godongwana confirmed that there is no current plan to fund the NHI. However, the government has made it clear that higher taxes and additional taxes will be required.

Strange promises

Lesufi – as premier of Gauteng – said the province is preparing for the NHI and has promised to do even more, repeating that it will “partner with the private sector to acquire 18 existing facilities” to expand the province’s capacity for the NHI.

When the premier initially made this promise during his SOPA, Wits School of Governance expert Professor Alex van den Heever said the move did not make any sense and was likely not doable.

“It’s a very unusual statement to make. He said the government would be buying back these 18 hospitals, but I know of no private hospital that the Gauteng department has previously sold – that’s the first thing,” said Van den Heever.

The second thing is cost, with the expert estimating the cost of 18 ‘typical’ facilities exceeding R7 billion, plus another R5 billion a year to maintain – money the Gauteng government does not have to spend.

For the 2024 budget, the Gauteng Health Department was allocated R64.8 billion. The bulk of this (R40 billion) is for personnel, and only R2 billion has been allocated for infrastructure. There was no mention of acquiring new facilities.

However, the main issue with the plan is that it is unnecessary, Van den Heefer said, as the way the NHI is envisioned, “it can contract with private hospitals; these hospitals don’t need to be under any department of health.”

“I also see Lesufi noted a partnership with a labour union fund to purchase these hospitals, but I don’t know how these would become a Gauteng Department of Health asset using private funds,” added Van den Heever.

He noted a private fund can’t purchase an asset for a government department, and it would be a losing asset for any union fund to do so.

“The Gauteng government simply does not have the money to buy 18 hospitals, and I don’t see how they could ever find that kind of money.

“Even if they did, it would serve no purpose when the so-called NHI would be able to contract without having to purchase any hospital,” said Van den Heever.

He added that if the provincial government had R7.2 billion to spend on purchasing assets, it would make more sense to fix up the current hospitals and make sure they are fit for purpose.

“None of this makes any sense. The proposal is just unfeasible and a very strange one to make overall,” he said.

Critics not biting

NHI critics (political parties, labour unions, business groups and various healthcare representatives) have lambasted the bill, and have labelled the sudden push before the elections as nothing but an electioneering ploy.

While not fighting against the idea of healthcare reform and universal healthcare as a concept, most stakeholders are pushing back against the current version of the bill, which they say will destroy private healthcare, remove choice in health services, and leave a multi-billion-rand fund in the hands of a government with a poor track record of managing such.

The NHI bill, if signed into law, faces a barrage of legal challenges – including on constitutional grounds – with analysts expecting the whole thing to suffer delays to the point that it is unlikely to be a reality in its current form.

According to union Solidarity, the lack of funding from National Treasury is a clear indication that not even the government is securely on board with the scheme.

“This lack of a clear financial plan results in many South Africans doubting the government’s ability to implement the NHI,” it said. “The NHI is also being used to solicit votes for this year’s general election.”

“The absence of a concrete financial strategy leaves unanswered questions regarding the possible impact on taxes, as well as the effects of possible tax increases in order to afford the NHI. Without a clear and credible financial plan, the NHI remains a hollow political promise.”

Read: Another NHI headache for Ramaphosa

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