National Health Insurance (NHI) – Can we afford it?

National Health Insurance (NHI) – Can we afford it?

Written on 07/01/2018
Profmark Team


The recently gazetted NHI Bill has caused much debate. While it cannot be disputed that as a society we need to ensure that all have access to quality healthcare , it has to be done on a successful economic basis. Last year, the Davis Tax Committee commented as follows:

“The proposed NHI, in its current format, is unlikely to be sustainable unless there is sustained economic growth.”

With negative growth for the first quarter we certainly are nowhere near sustained economic growth – the launching of the NHI in its current format is probably premature. We will keep you informed on future developments.

Some key points:

  • NHI is a health financing system that pools funds to provide access to quality health services for all South Africans based on their health needs and irrespective of their socio-economic status.
  • It will need a massive reorganisation of the current health system, both public and private
  • This cannot be achieved without creating a single common fund, which in itself will directly contribute towards:
    • a unified health system by improving equity in financing,
    • reducing fragmentation in funding pools across both the public and private sectors, and
    • making health care delivery more affordable and accessible for the population

Transitional Arrangements

Phase 1 was from 2012 to 2017.

Phase 2 will be for a period of five years from 2017 to 2022 and will:

  1. continue with the implementation health system strengthening initiatives, including the alignment of human resources with that which will be required under the Fund;
  2. include the development of National Health Insurance legislation and amendments to other legislation;
  3. include the undertaking of Initiatives which are aimed at establishing institutions that will be the foundation for a fully functional Fund

Phase 3 will be for a period of four years from 2022 to 2026 and will include—

  1. the continuation of Health systems strengthening activities on an ongoing basis;
  2. the mobilisation of additional resources as approved by Cabinet; and
  3. the selective contracting of healthcare services from private providers.