BHF rails at inaction on health costs

The Board of Healthcare Funders (BHF) has accused the department of health of dragging its feet on plans to make private healthcare more affordable — a claim the department denies. The BHF criticised the department on Tuesday, saying it failed to act on several recommendations from the 2019 health market inquiry aimed at reducing private healthcare costs. “The minister and department of health have consistently cited the high cost of healthcare as one of the reasons why National Health Insurance (NHI) is necessary. Yet presented with an opportunity to make a tangible difference they’ve not even attempted to get out of the starting blocks,” said BHF MD Katlego Mothudi.

The Board of Healthcare Funders (BHF) has accused the department of health of dragging its feet on plans to make private healthcare more affordable — a claim the department denies.

The BHF criticised the department on Tuesday, saying it failed to act on several recommendations from the 2019 health market inquiry aimed at reducing private healthcare costs. “The minister and department of health have consistently cited the high cost of healthcare as one of the reasons why National Health Insurance (NHI) is necessary. Yet presented with an opportunity to make a tangible difference they’ve not even attempted to get out of the starting blocks,” said BHF MD Katlego Mothudi.

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The Competition Commission published its health market inquiry report five years ago recommending steps to cut private healthcare costs. They include establishing a tariff negotiation forum between the private sector, allowing medical schemes to collectively determine prices with healthcare providers, which could reduce healthcare costs. Another recommendation was to establish a supply side regulator for health to ensure pricing is determined transparently.

The BHF said these changes would ease the financial burden on medical scheme members, making private healthcare more accessible while reducing pressure on public facilities.

The BHF says five years passed with little or no action from the government. That resulted in a widening gap between what medical schemes are willing to pay and what healthcare providers charge, forcing patients to make high out-of-pocket payments. The BHF has since formally requested a response from the Competition Commission regarding its 2021 application for an exemption from the Competition Act, which would allow medical schemes to negotiate tariffs collectively with healthcare providers.

“Granting the BHF exemption will be beneficial to the healthcare ecosystem, including medical scheme members, while we await the department of health to establish a negotiation chamber,” said Mothudi.

The BHF argues the move would improve transparency and ultimately lower costs for consumers. However, it criticised the commission for not exercising its own authority to grant the exemption, instead passing the buck to the health department.

In a recent presentation to the health portfolio committee, the commission said there had been four applications for exemptions on pricing before it, and that it was considering a block exemption.

“Instead of exercising its own legislative authority by granting the BHF’s exemption application, it continues to put the onus on the department of health to address the current pricing vacuum,” said the BHF.

The block exemption approach could further delay action, as it would require coordination between the commission and the department.

‘SEVERAL MEETINGS’

Competition Commission spokesperson Siyabulela Makunga confirmed that the commission had received correspondence from the BHF. “We are prioritising the consideration of the matter. The commission will make a decision in due course,” he said.

The department said that it had several meetings with the Competition Commission to find a solution to the matter of pricing. “These meetings have also included the Council for Medical Schemes (CMS),” said spokesperson Foster Mohale.

According to Mohale, the health market inquiry recommended a schedule 3A SSRH entity, a government-run health organisation that provides medical services to the public.

“The likelihood of another public entity being approved is very low as Treasury has indicated that they do not agree to more entities.

“Meanwhile, the NHI act is now law and there are some health market inquiry recommendations that will be incorporated into the various changes that will be brought about by the NHI developments (not all in the NHI Fund, but also in the Office of Health Standards Compliance, CMS and national department of health).”

Mohale said the department was also in talks with the Competition Commission about the four exemption applications.

“We are not in a position to share the discussions especially while there are threats of legal action, and indeed commenced action.”