Government kisses another R24 billion goodbye

 ·12 Mar 2024

The National Department of Health has paid around R24 billion in medical-legal claims over the last four years, once again bringing into question the affordability of the impending National Health Insurance (NHI) scheme.

Responding to a parliamentary Q&A, the department said that it had paid R23.6 billion in medical-legal claims since January 2020 – but this is not the total amount, with the Western Cape and the Eastern Cape numbers not yet reflected.

The Eastern Cape is still verifying its figures, while the Western Cape’s information is still being approved by the provincial head of department.

From the provincial data that is reflected, KwaZulu Natal accounts for the biggest portion, at R8.7 billion paid out.

ProvinceClaim cost
KwaZulu NatalR8 677 267 000
Free StateR2 484 606 000
GautengR1 897 283 000
LimpopoR266 805 000
MpumalangaR245 485 000
Northern CapeR152 235 000
North-WestR99 136 000
TotalR23 637 317 000

According to Democratic Alliance MP Michele Clarke, who posed the question to the department, the massive legal claim payouts pose another major red flag for the NHI scheme, which is still waiting to be signed by president Cyril Ramaphosa into law.

Citing the Auditor General of South Africa, Clarke said that these claims are already significantly taking away from the government’s provision of health services in the country, and the figures are being exacerbated by fraud, incompetence, and the lack of an electronic case management system (CMS) across the provinces.

Once the NHI becomes law and starts rolling out as a national system – pulling in the 9 million or so South Africans using private healthcare – these costs are likely to rise even further, putting even more strain on an already over-burdened public sector.

“By pooling resources into an already dysfunctional healthcare sector, medical claims will only further increase, alongside fraud,” Clarke said.

The DA MP noted further that the escalation in claims is happening alongside a reduction in health budgets for the provinces, where provincial national health insurance grants were lowered by R239 billion.

While Ramaphosa has vowed to sign the NHI Bill into law before the 2024 elections, legal experts, analysts, and businesses within the healthcare industry have stated that the scheme is likely to be dead in the water in its current form.

Aside from lacking any funding – with the National Treasury only budgeting R1.4 billion specifically for the NHI over the medium-term, seen largely as a gesture or acknowledgement – the scheme is likely to be bogged down in legal challenges for the foreseeable future.

Various groups, including the DA, have said they are ready to pull the trigger on legal action as soon as the bill is signed into law.

These same groups support the concept of universal healthcare but do not see the destruction of private healthcare and medical aids – nor the centralising control over funding within a government known for mismanaging funds – as the optimal pathway to achieve it.

Read: Another NHI headache for Ramaphosa

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