competition commission south africa HEALTH MARKET INQUIRY EXECUTIVE SUMMARY September 2019 competition commission south africa
Executive Summary 1. In our review of the South African private 4. Full implementation of the NHI is some healthcare market we found that it is years away, with the Fund scheduled to characterised by high and rising costs of be operational by 2026 at the earliest. The healthcare and medical scheme cover, and private sector will continue to operate in the signifjcant overutilization without stakeholders interim and also after 2026. We have taken having been able to demonstrate associated this into account in the implementation of our improvements in health outcomes. recommendations which will provide a better environment in which a fully implemented 2. We have identifjed features that alone or NHI can function. Nonetheless, we have in combination, prevent, restrict or distort always had regard to the mandate refmected competition. The market is characterised by in the TOR: to primarily focus on issues that highly concentrated funders and facilities affect the private sector. markets, disempowered and uninformed consumers, a general absence of value-based 5. We have found there has been inadequate purchasing, practitioners who are subject to stewardship of the private sector with failures little regulation and failures of accountability that include the Department of Health not at many levels. using existing legislated powers to manage the private healthcare market, failing to ensure 3. We are concluding our work at a time when regular reviews as required by law, and failing South Africa is embarking on a journey to to hold regulators suffjciently accountable. As establish a National Health Insurance Fund a consequence, the private sector is neither (NHI), a means to achieve universal health effjcient nor competitive. coverage. Based on the latest version of the NHI Bill, Gazetted on 26/7/2019 (Gazette no. 6. A more competitive private healthcare market 42598), it is envisioned that the NHI will create: will translate into lower costs and prices, more a unifjed health system by improving equity value-for-money for consumers and should in fjnancing; reduce fragmentation in funding promote innovation in the delivery and pools; and by making healthcare delivery funding of healthcare. As the state becomes more affordable and accessible, eliminate out- a purchaser of services (from the private of-pocket payments when individuals need to sector as indicated by the NHI Bill), it will be access healthcare services; and ensure that all able to enter a market where interventions South Africans 1 have access to comprehensive like the establishment of a supply side quality healthcare services. regulator, a standardised single obligatory benefjt package, risk adjustment mechanism, 1 All South Africans, permanent residents and other registered users as defjned in Chapter 2 of the NHI Bill will be covered by the fund. 1
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