NHI Snippets (6): The high cost of private health care in South Africa

So, I’ve elaborated a little on the poor health of South Africans relative to the country’s level of economic development and wealth.

The second major point I made at the beginning of this blog series was that a huge proportion (43%) of all the money spent on health care in South Africa is paid as premiums by people on medical aid (medical aid is what is know internationally as ‘voluntary private health insurance’).  In fact, the proportion is so huge that South Africa tops the list of countries around the world in this regard, even outdoing the United States.

If you want to see this point displayed graphically, click on this link – Proportion of spending on health insurance – for a slide by Prof. Di McIntyre of the Health Economics Unit at UCT.1   On the extreme right of the graph are South Africa and the United States, each spending a large amount on voluntary private health insurance (the red section of the bars).  The other countries shown in the graph have health systems which are getting close to achieving universal health care coverage (in a later blog I’ll explain this term but in broad terms it means that most citizens are able to access and afford adequate health care).  You’ll see that, for these countries, the red section of the bar is very small.

The last bit of information you need to know to appreciate this graph is that ‘the big red bit’ of South Africa’s bar is spent by only 16 percent of the population.2  So the following picture emerges:

1.  Only a very small proportion of South Africa’s population has access to high quality care (this is assuming that lots of resources translates into good quality, which isn’t wholly true, so I’d like to qualify this statement in a later blog as well as note that good quality care is also available in the under-resourced public sector);

2. Private health care is very expensive and funding this care places a very high financial burden on those who can afford it.

3. Countries achieving universal health care coverage have not relied on private voluntary health insurance to do so (I’ll elaborate this point later and, of course, we need to have the discussion about why universal health care coverage is desirable.)

 

REFERENCES

1. McIntyre D.  2011.  Options for South Africa:  Financing.  Presented at National Department of Health Consultative Conference on “National Health Insurance:  Lessons for South Africa”, Gallagher Estate, Midrand, 7-8 December 2012.  Available at:  http://www.hst.org.za/publications/presentations-national-health-insurance-nhi-conference-2011

2.  McIntyre DE, Doherty JE, Ataguba JE. (forthcoming). Health care financing and expenditure – progress since 1994 and remaining challenges. Health and health care in South Africa (2nd edition). Van Rensburg H. Pretoria: van Schaik Publishers.

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