NHI court battle heats up in South Africa

The South African government has missed a deadline in its court battle over the National Health Insurance (NHI) Act, with it asking for an extension to the end of November.

Trade union solidarity said it would continue to argue against the NHI if it were unopposed in court after the government failed to supply opposing court documents after over four months.

Solidarity filed its initial papers at the Gauteng North High Court in May and has requested that the case continue unchallenged as the opposition has not supplied the necessary documents.

Although the NHI was signed into law by Presdient Cyril Ramaphosa before the latest national election, it has not yet been promulgated.

The NHI forms part of the government’s strategy to create universal healthcare.

The NHI is set to be a centralised national insurance fund. The government will buy healthcare services from providers in both the public and private sectors.

All eligible South African residents, as defined in the NHI Act, could visit these providers whenever they need healthcare without payment. The government’s coffers will fund the system.

Ramaphosa previously said that the NHI aims to level the playing field and merge the country’s fractured healthcare systems. The private sector caters to only a small percentage of the population, while the public sector remains overburdened and underfunded.

Speaking to News24, the Department of Health said that its lawyers were engaging with the office of the Deputy Judge President for an extension to 27 November. 

Although the department admitted that it had missed the 2 October deadline for answering affidavits in Solidarity’s application, it said that its lawyers needed more time, given the magnitude of the application.

The department said that Solidarity knows these engagements and that it would be a surprise if the case proceeded unopposed. The department said that it would object to such an approach.

It has also requested a further extension to file opposing papers in a separate application brought by the Board of Healthcare Funders (BHF), with the government stating it could not meet the 16 October deadline.

Criticism of the Law

The NHI has been widely criticised, with medical aid schemes, healthcare providers, members of the public, and parliament’s own legal team criticising the Act in its current form.

A central part of Solidarity’s challenge looks at the unconstitutionality of Section 32 of the NHI act, which states that medical aids will not be allowed to reimburse members for services following the implementation of the NHI. It argues that this individual choice.

Financing is also a concern, with estimates showing that funding for the NHI would require VAT to increase 14% to 21%, personal income tax by 31%, and an additional payroll tax of R1,500 per month on every working person—or a potential collaboration of all three.

Ratings agency Fitch also expressed concerns over the NHI.

Fitch said it expects consolidated government debt to rise to 76% of GDP in FY24, 77.8% in FY25 and 78.0% in FY26, which is far above the 2024 ‘BB’ median of 55%.”

Although risks to its forecasts are balanced, if implemented in its current form, the NHI Act poses upside risks to Fitch’s expenditure forecast.

Although many private sector players believe that the NHI should be introduced, they don’t think it is workable in its current form.

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