Board of Healthcare Funders of Southern Africa COMPETITION - - PowerPoint PPT Presentation

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Board of Healthcare Funders of Southern Africa COMPETITION - - PowerPoint PPT Presentation

Jul 19, 2023 445 likes •778 views

Board of Healthcare Funders of Southern Africa COMPETITION COMMISSION HEALTHCARE INQUIRY PRIVATE SECTOR Dr Humphrey Zokufa : BHF Managing Director Dr Rajesh Patel : BHF Senior Manager 1 st March 2016 Outline Introductory Remarks

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Board of Healthcare Funders of Southern Africa COMPETITION COMMISSION HEALTHCARE INQUIRY – PRIVATE SECTOR

Dr Humphrey Zokufa : BHF Managing Director Dr Rajesh Patel : BHF Senior Manager 1st March 2016

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Outline

  • Introductory Remarks
  • Consequences of “no price regulation” of healthcare services in the Private

Healthcare Sector.

  • Costs and price of service remains a problem!
  • Healthcare Accountability
  • Overspending on underwhelming health outcomes
  • Concluding Remarks
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Introductory Remarks

  • BHF, previously RAMS, is a non-profit company – representing medical schemes, managed care organizations and

administrators of medical schemes.

  • Membership in South Africa, Zimbabwe, Namibia, Botswana, Swaziland, Mozambique and Lesotho.
  • The Competition Commission fined BHF in 2003 for anticompetitive behavior.
  • In September 2007 BHF applied in terms of section 10 of the Competition Act No. 89 of 1998,for an exemption to the

Competition Commission from the provisions of the Competition Act – denied.

  • In November 2012, BHF requested an advisory from the Competition Commission determining whether or not section 4
  • f the Competition Act, 89 of 1998 is applicable to restricted schemes – advisory not very helpful.
  • BHF engaged the late Minister of Health, Dr Manto Tshabalala – Msimang on various occasions regarding the inability for

the funding industry and providers to negotiate tariffs.

  • In September 2007, the Minister convened a “Health Indaba” in Midrand to address this issue.
  • An amendment was made in the National Health Act, by inserting a chapter that was obligating the negotiations –

unfortunately it was not processed by the Portfolio Committee on Health.

  • BHF engaged the current Minister of Health, Dr. Aaron Motsoaledi on this issue - establishment of this Commission of

Inquiry into the Private Healthcare.

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SLIDE 4

Private Healthcare Funding 83 Medical Schemes 8.8 Million members R140.2 billion R124.1billion payment (88.5%) Providers of Healthcare Private Hospitals Medical Specialist General Practitioner Pharmacists Nurses Physiotherapists Allied Health Traditional Healers Healthcare Products Pharmaceuticals Medical devices Surgicals Medical Equipment SA Constitution

Investors Investors

Government Healthcare Policies Legislation Medicine and Related Subst Act National Health Act Medical Schemes Act Pharmacy Act Nursing Act Health Professions Act Traditional Health Pract. Act Competition Act Consumer Affairs Act

Contributions

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SLIDE 5

Consequences of “no price regulation” of Healthcare Services – Scene 1

Operating results of Medical Schemes

  • 2005/2006 R356.2million deficit
  • 2006/2007 R2.1billion deficit
  • 2007/2008 R992million deficit
  • 2008/2009 R929million deficit
  • 2009/2010 R2.5billion deficit
  • 2010/2011 R459million deficit
  • 2011/2012 R1 billion surplus
  • 2012/2013 R25.7million surplus
  • 2013/2014 R1.55billion surplus
  • 2014/2015 R464.5million deficit
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SLIDE 6

Consequences of “no price regulation” of Healthcare Services – Scene 2

Operating results of Medical Schemes

  • 2005/2006 R356.2million deficit
  • 2006/2007 R2.1billion deficit
  • 2007/2008 R992million deficit
  • 2008/2009 R929million deficit
  • 2009/2010 R2.5billion deficit
  • 2010/2011 R459million deficit
  • 2011/2012 R1 billion surplus
  • 2012/2013 R25.7million surplus
  • 2013/2014 R1.55billion surplus
  • 2014/2015 R464.5million deficit
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SLIDE 7

Consequences of “no price regulation” of Healthcare Services – Scene 3

Operating results of Medical Schemes

  • 2005/2006 R356.2million deficit
  • 2006/2007 R2.1billion deficit
  • 2007/2008 R992million deficit
  • 2008/2009 R929million deficit
  • 2009/2010 R2.5billion deficit
  • 2010/2011 R459million deficit
  • 2011/2012 R1 billion surplus
  • 2012/2013 R25.7million surplus
  • 2013/2014 R1.55billion surplus
  • 2014/2015 R464.5million deficit
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SLIDE 8

Consequences of “no price regulation” of Healthcare Services – Scene 4

Operating results of Medical Schemes

  • 2005/2006 R356.2million deficit
  • 2006/2007 R2.1billion deficit
  • 2007/2008 R992million deficit
  • 2008/2009 R929million deficit
  • 2009/2010 R2.5billion deficit
  • 2010/2011 R459million deficit
  • 2011/2012 R1 billion surplus
  • 2012/2013 R25.7million surplus
  • 2013/2014 R1.55billion surplus
  • 2014/2015 R464.5million deficit
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SLIDE 9

Consequences of “no price regulation” of Healthcare Services – Scene 5

Operating results of Medical Schemes

  • 2005/2006 R356.2million deficit
  • 2006/2007 R2.1billion deficit
  • 2007/2008 R992million deficit
  • 2008/2009 R929million deficit
  • 2009/2010 R2.5billion deficit
  • 2010/2011 R459million deficit
  • 2011/2012 R1 billion surplus
  • 2012/2013 R25.7million surplus
  • 2013/2014 R1.55billion surplus
  • 2014/2015 R464.5million deficit
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SLIDE 10

Consequences of “no price regulation” of Healthcare Services – Scene 6

Medicine Price Regulation

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SLIDE 11
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SLIDE 12

Healthcare Accountability

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SLIDE 13

What is your business?

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Section 27 and Section 28.1.c(Child)

1) Everyone has the right to have access to

  • a. health care services, including reproductive health care;
  • b. sufficient food and water; and
  • c. social security, including, if they are unable to support themselves and their

dependants, appropriate social assistance. 2) The state must take reasonable legislative and other measures, within its available resources, to achieve the progressive realisation of each of these rights. 3) No one may be refused emergency medical treatment.

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SLIDE 15

MSA

“business of a medical scheme” means the business of undertaking liability in return for a premium or contribution— (a) to make provision for the obtaining of any relevant health service; (b) to grant assistance in defraying expenditure incurred in connection with the rendering of any relevant health service; and (c) where applicable, to render a relevant health service, either by the medical scheme itself, or by any supplier or group of suppliers of a relevant health service or by any person, in association with or in terms of an agreement with a medical scheme;

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MSA

  • Not explicit that the business of MS must be to improve healthcare of the

beneficiaries, or in pursuance of the constitutional mandate!

  • Medical scheme are quasi insurance currently regulated by CMS (not FSB)

but report to Minister of health

  • “insurance” thinking perpetuated since the Melamet inquiry (late 80s)
  • “catastrophic cover” and “discretionary expenditure”, new terms from 90s
  • Inadequate stewardship/leadership about what the business of MS

should be.

  • Need for “health governance” to be included in the definition
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“Insurance” thinking evident in current problematic PMBs

  • Discriminatory and poorly structured!
  • Diagnosis and severity based (ill-defined e.g. life threatening)
  • Limited set of conditions DTP/CDL
  • Hospicentric, adult focus, women’s health…
  • No formal policy document with inclusion and exclusion criteria
  • Not developed with the Access to Care, or Health of beneficiaries in mind!
  • Developed with Insurance (financial protection) in mind.
  • Focus on depth of benefit for the few rather than breadth of benefit for most
  • MSA Reg 7: CDL is not PMB (benefits in the spirit of the regulations)
  • Error: brought to the attention of CMS in 2006; advice continues to be ignored.
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“Insurance” thinking evident in current problematic PMBs

  • Regulated benefit with regulated price is

required for certainty!

  • CMS Current Reg.8 interpretation: unintended

limitless liability

  • Lack of price certainty make PMB less

affordable, particularly for lower income earners (No income cross subsidy!)

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SLIDE 19

Suggestions

  • PMB:
  • Non discriminatory: service based not diagnosis based
  • Define “essential” services e.g. Essential Drug List
  • Urgent revision of the MSA and its Regulations to align with Section 27/28

and other progressive government health policies

  • PMBs has not been reviewed!
  • Stewardship: Need health governance to be included!
  • CMS Circular 15 Of 2016: Publication Of The Healthcare Utilisation Data

Specification Document For The Utilisation Section Of The Annual Statutory Return

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SLIDE 20

Health Governance

  • Identify health Needs
  • Ensure health services/benefits for the needs
  • Actions and programs for priorities
  • Monitoring and Evaluation
  • Interrogation and Accountability (RP)
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SLIDE 21

Overspending on Adverse Health Outcomes

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Health Inquiry submissions: “High utilisation” and “burden of disease”

  • Appears to be some level of Ignorance!
  • Probably accountant, lawyer or actuary interpretation of data
  • Adverse health outcomes!
  • Supplier induced demand!
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SLIDE 23

Is healthcare cost a problem?

StatsSA

  • Medical inflation
  • CPI + 4.3% (2009-2013)
  • Health insurance of Household Expenditure
  • 3.4% (2006-2007)
  • 7.2% (2010-2011)
  • ±10% 2015 (unconfirmed)

Overspending beyond levels of affordability!

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SLIDE 24

Hypertension (HQA 2015 and earlier)

(underutilisation of essential care and rising adverse outcomes!)

2010 2011 2012 2013 2014

Creatinine Coverage% 38 39 41 43 45 Cholesterol coverage % 34 33 36 36 37 ECG coverage % 22 21 21 20 20 Glucose screening % 43 42 42 Stroke admission per 1000 3.5 3.6 10.6 10.5 11

  • Approx. 250,000 undiagnosed/unregistered!
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SLIDE 25

Newborns (HQA 2015)

  • LBW (<2.5kg): 5%
  • 13% of newborns admitted to NICU
  • Sick society (burden of disease) or very poor Maternity services
  • Supplier induced demand
  • ICU fees and modifier 0019
  • CMS chaos related to mod 0019!
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SLIDE 26

C Section(HQA 2015):

  • 72%
  • Additional R0.5B+ to hospital costs

0,00% 5,00% 10,00% 15,00% 20,00% 25,00%

% of C/S cases

% of cases

90% 10%

Paying for convenience & preference! Lack of alignment to guidelines!

  • Hb:

83%

  • HIV: 38%
  • Hep B: 30%
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SLIDE 27

Maternity: RVU increased (2015)

Puerperium period reduced from six weeks to four weeks! 282 267

  • Approx. 100% increase!
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Depression (HQA 2014):

2010 2011 2012 2013

Depression - lives admitted per 1000 5.8 5.8 9.1 8.5 Depression - 10 day post discharge % 2.1 2.5 2.2 2 Depression - 30 day post discharge % 6.4 6.4 5.7 5.3

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SLIDE 29

Access to essentials medicines:

Inadequate health governance throughout the value chain!

Finance centric rather than health centric!

2010 2011 2012 2013 2014

IHD Aspirin Cover % 61 57 63 62 60 Statin coverage % 67 59 59 59 58 Diabetes I & II Statin coverage % 40 34 35 37 38 Cardiac Failure ACE/ARB Cover % 65 62 60 60 59

Source: HQA 2015 reports

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SLIDE 30

Diabetes outcomes (HQA 2008)

  • 2007 claims
  • LL Amputation rates FFS

vs

  • CDE 11x
  • Hyperglycaemia adm FFS

vs

  • CDE: 33x
  • Pockets of excellence in

centers of excellence

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SLIDE 31

Concluding Remarks

  • Pockets of excellence!
  • Underspending on essential healthcare!
  • Overspending on adverse outcomes &

“wasteful events”!

  • Need stewardship.
  • Transform thinking about the business of

Medical Scheme.

  • Urgent need for regulatory reform.