Where are our health costs going?

If there is one thing that the medical industry in South Africa can agree on, it is that medical bills are too high.

The area where agreement fails, however, is in what is driving the high costs and what the remedy should be. Every sector have their theories, hypothesis and no one seems to agree what the solution could be.

I am fully behind the establishment of a National Health Scheme (NHI) because I believe passionately that access to health care is a human right and should be afforded to all South Africans. But at what point does price start to change people’s minds about the value of caring for their neighbour?

I am sure that very few people would refuse to pay a small amount to ensure that their fellow citizens are provided with health care, but for most people there is a threshold to their altruism, a point beyond which they begin to feel that the costs are too high.

The same is true for medical schemes. How much can costs be increased before they begin to drive people away? How much is too much for the average member of the public to afford?

When I read recently that the National Treasury estimates that taxpayers will be expected to pay R80 billion more by 2025 to fund NHI, my heart sank.

What is the solution? Are these figures based on costs which are already unacceptably high?

Last week, at the 6th World Congress of Paediatric Cardiology and Cardiac Surgery, Jonathan Broomberg, CEO of Discovery Health told delegates that medical inflation in South Africa last year was double the consumer price index (CPI).

Doctors’ tariffs are just one driver of high costs. Others include hospital and equipment costs, while patients with a chronic conditions claim four times as much as those without. Ironically, as research makes previously inoperable conditions treatable, the costs go up as well. The gap between expectation and reality is growing daily. Patients obviously want access to the latest technology at the lowest possible cost. Doctors want to maximise their income and medical schemes must find a balance or ways to balance their books.

A recent article in business Report quoted Dr Mzukisi Grootboom, chairman of the South African Medical Association, as refuting claims that specialist are overcharging for their services. SAMA’s position is that the vast majority charge between 100 percent and 110 percent of scheme rates for prescribed minimum benefits (PMBs) Do you agree with this and why?

Perhaps the answer is to ensure that there is full transparency when it comes to costs of health care and treatment. We also need to ensure, each in our own way, that the general standard of health care in our country improves. So why don’t you let us know what three things you would do to help control costs escalations in our fragile healthcare system?


5 thoughts on “Where are our health costs going?

  1. Until people stop abusing their bodies by excessive use of alchohol, drugs and eating over-processed food, the health crisis will remain because there will be too many sick people accessing too much technology with too little money.

    • Hi Marilyn.
      I agree that you have a point. However I am also interested as to what else do you think we as citizens can do personally to address and help the escalation of costs?
      It seems to me that we all look outside ourselves when we see negativity. In systems thinking and problem solving I try to teach people to look at what can they do to improve or alter the trend line and unfolding situation.
      So I would love to know if you were to take action personally what would you do different to help drive costs done?
      i sincerely hope you see this in the positive light it is meant:):)

  2. So there must be more people out there that have an opinion on “Where our Health care costs are going?”
    Join the debate and discussion and hopefully we can get new and workable ideas.

  3. The main theory playing itself out in the healthcare industry is the central economic theory of supply and demand.

    – Doctors especially specialists are in short supply
    – Prices in the private sector are unregulated (does not mean they are free to move and are not controlled in other ways).
    – Total absence of an government sector treatment alternatives of acceptable quality for people who can are still able to afford some measure of private care
    – Hospital environment, pathology and radiology are dominated by a few large networks (no real competition).
    – Information in the industry is asymmetric and favours the supply side i.e. patients are not in a position to shop around for better prices and some doctors can abuse their discretion to over-service.
    – Medical schemes are abdicating their duty towards members (how can the biggest medical scheme in the country pay a GP more than what a cash patient pays?)
    – Demand for services are increasing due to an ageing population and lifestyle factors

    All of this creates the perfect storm and without some radical changes to address the fundamental flaws in the system, the outcome is pretty much predetermined.

  4. Healthcare is expensive yes… But this is due to the fact that the competition commisioner years ago said there must be competition between the groups and service providers to enable patients to make an informed decision when needing treatment… Now after this, patients are still uneducated about their rights and there is no one driving regulations with regards to NHRPL anymore. If you cant afford a specific hospital or specialist… Obtain quotations and choose what you can afford! Its your right! Dont blame health industries because you do not now your rights or do not know before admission or treatment what your financial risk will be… If your treatment was more than quoted without any extras that was done… You have the right to report it to the HPCSA or Board of medical schemes.

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