Background
The introduction of a universal healthcare system in South Africa has been debated for more than 18 years. The Bill was introduced on 8 February 2019 and has been debated ever since. The establishment of universal healthcare in South Africa would be a step towards realizing the country’s constitutional right to healthcare and would address the need to improve access to adequately funded and staffed facilities.
Key details
The universal healthcare system would apply to all South African citizens as well as long term residents. Once established, the Fund would create a single-payer system that compensates providers for an approved set of services via the Fund.
Under the currently proposed structure, employees will contribute to the Fund via payroll deductions proposed to begin at 1% of gross pay. Employers will be responsible for collecting contributions and for submitting them to the fund. At this time, no employer contribution amounts have been explicitly announced, but this is subject to change. Industry professionals have noted that sustainable funding would likely require contributions closer to 7%.
The Bill maintains the existence of private medical polices, known locally as medical aid schemes, and would allow employees to continue to participate in private plans, but once fully implemented, private plans would only be allowed to cover services that are not covered under the new NHI system.
Next steps
As many of the key details of the legislation are subject to change, and the timeline for implementation will take many years, employers in South Africa should continue to monitor the progress of the Bill through Parliament. The current proposal is for a single-payer model, where the government would be the primary payer for all services under its purview, but many believe that a multi-payer model may be the outcome with private medical plans playing a more integral role in services available to individuals.
It is expected that it will take several years to set up and implement the structure of the Fund as well as establish the approved services, payment levels, and other administrative details. Additionally, since the legislation requires the updating and enhancement of existing healthcare facilities to further ensure parity in care and services, the timeline for full implementation may take up to an estimated 10 years. Industry experts also caution that, due to the requirements of the federal constitution, there may be future court challenges that could further delay implementation.
