Integration of Public and Private Healthcare Sectors in NHI

2. Integration of the public and private sectors under the NHI and other research Mariné Erasmus 21 September 2010 IRF Conference - Sandton

3. Public Healthcare Providers Healthcare Service Delivery Provider Contracting and Payment Healthcare Service Delivery Contribu-tions Non-contributing Individuals Contributing Individuals National Health Insurance Authority Healthcare Service Delivery Healthcare Service Delivery Provider Contracting and Payment Private Healthcare Providers Key features of the current proposal

4. Current research • Series of research notes on general health reform • Importance of primary care • Accreditation • Integration of public/private sectors • Human resource requirements • Reimbursement levels and models • Freedom of choice • Earmarked tax for NHI • Other practical issues

5. Role of Primary Healthcare in Health Reform • Health Minister Motsoaledi’s turnaround strategy: renewed focus on PHC • Evidence of improved affordability & accessibility of public healthcare by poor households since 1994 • Quality remains a concern • Waiting times • MDG 4: reduce child mortality • MDG 5: reduce maternal mortality • Assuring quality through accreditation

6. Percentage of people who experienced the following problems while visiting a public hospital or clinic, GHS 2008

7. Maternal mortality ratio(maternal deaths per 100,000 live births)

8. PHC in South Africa • “South Africa is regarded as a superpower in health on the continent. Yet, the irony lies in the fact that most of these countries that turn to South Africa for hi-tech healthcare have low infant and maternal mortality rates.” Minister Motsoaledi • Focus on delivery of PHC will have large impact on poor & vulnerable communities • PHC facilitates less costly and more equitable healthcare • But in SA: • Higher detection rates at PHC level implies greater costs in short to medium term • Expect cost decreases in long term • Implies major changes to current private sector delivery model

9. Integration of the public and private healthcare sectors • Contracting? • Payment mechanisms & levels? • Referral system? • Choice of provider? • Service delivery models? • Current promise: • Universal coverage • Free choice of provider at PHC level (although restricted to geographical area) • Capitation at PHC level, global budgets for hospitals

10. Integration of the public and private healthcare sectors (continued) Private sector: • GPs & specialists paid on fee-for-service basis at the moment • Not employed by hospitals • Large out-of-pocket payments by medical scheme beneficiaries and non-members • Free choice & direct access to specialists in most cases • Demand rationed by price Proposed comprehensive PHC approach: • Integrated, holistic & more preventative • Outreach beyond hospitals, analysis of upstream factors • Focus on family, not just individual • Task-shifting (multi-disciplinary practices/ health teams: CHWs, nurses, doctor)

11. Integration of the public and private healthcare sectors (continued) • Only limited excess capacity in private sector (±20%) • 32% of population already use private out-of-hospital services (DBSA Roadmap study) • 36.7% of population depends on private sector for PHC (McIntyre et. al.) • GPs & specialists (CMSA 2009) • Private GPs: 0.44 per 1,000 population • Public GPs: 0.35 per 1,000 population

12. Integration of the public and private healthcare sectors (continued) • Private sector players will only contract with NHIA if beneficial to them • Quality differences, implicit rationing • Possible perpetuation of current system at higher costs • Conversion to higher private sector prices if no differential payment structures

13. Patient choice & referral • Rationing choice is inevitable • GP gatekeeper model (across the world) • South African proposal • Will restrict choice • Current rationing in public sector vs. private sector • Limited resources vs. to keep system affordable • Need clearly defined referral guidelines • Geographical inequalities affect choice & referral • Information systems • Other practical concerns

14. Provider payment systems • Single-payer system with monopsony powers • Different payment options with associated incentives • BUT unique SA situation • Quality differences • Shortage of doctors • HPCSA rules • Private insurers (medical schemes)

15. Concluding remarks • To deliver on the promise of quality care for all South Africans (under a NHI system), integration between public & private sectors must happen • Many practical concerns, including: • Service delivery model • Referral mechanisms • Contracting & payment • HR requirements • Information systems, etc. • Theoretically, if the hurdles could be overcome, access, affordability, quality & health outcomes (life expectancy, etc.) should improve over the long run • Further research needed

16. Thank you.