1. “The role of administrators, restricted NHI environment” by Blum Khan
BHF Conference 2009
“The role of administrators, restricted
and open schemes in the
NHI environment” by Blum Khan

2. Agenda Introduction Typical Funding Models Political Realities
NHI can work if…
Administrators
Medical Schemes

3. Introduction NHI build and implement phase has started
Delivery, organization and funding
Inherited a “Dual system” still here today
“Progressive realisation” of constitutional right is an imperative
Private and Public Sector polarization continues
Medical schemes market remains static

4. Typical Funding Models
Multi Payer
Single Payer
Competing health funds
Public bodies, Private for-profit Private non-profit
Minimum Standard of coverage
No Risk Rating/No Risk Selection
Single fund pays service providers and hospitals
Run by Government or State Agency
Regulated by legislation
Simplicity for patients and providers with savings in overhead costs

5. Global Political Reality
Spend accelerating as a % of GDP of OECD countries
Aging populations drive health care utilisation
PriceWaterhouseCoopers study - by 2020
= 21% of USA GDP
=16% of GDP in OECD countries
Will see far-reaching changes in national policy

6. SA Political Reality Total population >48 million
Low life expectancy
% of GDP 2006: %
Burden of disease is vast e.g. HIV, TB and Malaria
Public health system under-funded, over stretched
Electorate expects service improvement
Private healthcare seen as profiteering
Ranked 175/191 WHO Overall Health System Performance
Lives covered remains static (GEMS + Private Sector -)

7. NHI can work if…. Likely landscape
Partnership between the public and private sector
Most residents contribute to NHI
NHI hospitals operated and administered by private contractors
Licensing needs to change
The private healthcare sector consolidates
Likely landscape
Single payer model
Allow supplemental/Top Up health insurance
Further consolidation of medical aid schemes
Private healthcare members will pay more

8. Role of Administrators
Available capacity
Can fast track NHI rollout
Sound industry experience
Interfaced with providers and hospitals
Governed by legislation
Can deliver service standards

9. Role of Medical Schemes
Facilitate consolidation
Simplify benefit design
Develop top up cover products
Reposition value proposition
Interface efficiently with NHI

10. Conclusion Planning for NHI started in 1994
Polokwane adopted the resolution
Critical building blocks are in place
“As Is” not sustainable
GEMS = proof of concept phase
Healthcare in SA is under construction
Large private institutions can play a significant role
Be ready to move on NHI…but proceed with caution