Another healthcare group joins the chorus of warnings over the NHI in South Africa

Life Healthcare has joined the growing list of companies crying foul over the National Health Insurance (NHI) Act.

Last week, President Cyril Ramaphosa signed the NHI Bill into law. This new legislation aims to address the country’s healthcare inequality and establish a government-run fund to buy healthcare products for the population.

Like many other companies in the health sector, Life Healthcare supports the idea of universal healthcare.

“However, the approval of the Bill without addressing concerns raised during the parliamentary process, is
a regrettable missed opportunity to expand sustainable access to healthcare,” said the group in its interim results for the six months ended 31 March 2024.

“We, therefore, expect a lengthy implementation journey of NHI due to operational and legislative changes required, as well as the current fiscal constraints.”

Its competitor, Netcare, shared this sentiment in its own interim results.

Life Healthcare said that the reforms within the NHI Act will impact the sustainability of the health system for generations, with it planning to contribute meaningfully to “the envisaged extensive legislative reforms of the NHI Act.”

“We are monitoring the developments on the NHI Act as well as related legislation and will explore all
avenues to ensure the sustainability of the healthcare industry.”

Financials

Over the six-month period, the group saw its revenue grow by 7.8% to R11.7 billion, driven by activity growth in southern Africa and strong growth in NeuraCeq doses sold.

Paid patient days (PPD) in the acute hospital and complementary businesses also grew by 2.3%

The group also concluded the sale of Alliance Medical Group (AMG) on 31 January 2024 and received R10.2 billion in net cash processed after the settlement of all offshore debt and transaction costs, with a special dividend of R8.8 billion paid in April from the proceeds.

With the group’s headline earnings per share jumping by 540.6% to 242.8 cents per share, the group upped its interim dividend by 11.8% to 19 cents per share.

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