1. Introduction and Context

We start from the premise that health is a right as enshrined in the Constitution, and that the State is responsible for ensuring that all South Africans have access to adequate healthcare. The key problem that faces our health system today is the massive inequalities associated with low-quality care for the poor at both primary and tertiary levels. This leads to a weak health care outcome, despite the fact that there is a relatively good level of resourcing.

In addition poor working conditions in the public sector, with long hours, shortages of staffing and resources and relatively low pay. At the same time we have a run away private health industry, which is responsible for huge inequalities in healthcare provision and use of state resources. The rapid rise in Medical Aid costs is far higher than medical inflation for most of the past decade.

The Bill needs to combat the inequality and poverty that impacts on people’s health. Its relevance in addressing this will determine whether we shall be able to make a substantial shift in health care provision.

The drafting of health legislation has been a long process. Since the White Paper for the Transformation of the Health System in South Africa, there has been serious debate in various spheres of government, amongst civil society organisations, trade unions and the private sector regarding the implications of this legislation. COSATU and NEHAWU therefore welcome the opportunity to make their submission to the Portfolio Committee on Health on the National Health Bill.

The Bill is being introduced at a time when the Department of Health is engaged with a number of parallel processes, which will have an impact upon the content of the Bill., These processes however, will not be complete, before the Bill has been passed. These include health care financing and the integrated public service.

Critically the Bill should address the main problems of the Health system, which can be summarised as follows: -

· Substantial under budgeting, and as a result understaffing, including in primary health clinics. Whilst the health budget has grown since 2000, after four years of cuts, it has also had to deal with the escalating responsibility for HIV/AIDS.

· Co-existence of public and private health sectors pushes up national spending on healthcare without benefiting the majority. In fact the private sector drains skills from the public sector thus aggravating inequalities in health care provision.

· High cost of patented medication and the lack of an industrial strategy to support local production. Whilst a legal framework for producing medication locally has been introduced, and this will lower the costs of medication, we have lost two decades of production capacity as foreign investors have taken over and shut down local production in favour of imports.

· It is important to tackle the soaring costs of medical aids and the causes thereof. Whilst government has attempted to regulate this industry , private capital has moved to push up the cost of medical aids, in a response to increased regulation. Deteriorating Public health services have led to a flight to the private sector.

· Poor management at local level plus lack of understanding of national policies, compounded by provincial policies on how to deal with the equitable share of the division of revenue.

· Hierarchical work organisation and oppressive labour relations practices.

The publication of the National Health Bill, takes us one step closer to an overarching National legislative framework. Yet, the provisions contained within this Bill are significantly at odds with the original intention envisaged in the White Paper calling for a transformed National Health System.

The Taylor Committee Report aptly states that the ‘existing structure of the health system has certain endemic perverse cycles that need to be reversed through interventions at an institutional level’. One of the contributors to these endemic perverse cycles is the constant or declining real budget allocation. [1]

For the public sector, the inadequate budget allocation is further compromised by an increasing population and disease burden. Limited financial resources are by far one of the major challenges facing the viability of implementation of this Bill.

In our submission on the Draft National Health Bill, we raised concerns regarding the policy orientation of the Bill, especially the weight accorded to availability of resources or the lack thereof. We argued for a reversal of the decision-making process and instead advocated that greater ‘emphasis be placed on budgetary allocations being determined in accordance with national commitments to achieving transformatory goals’, rather than problematic fiscal targets determining the degree to which objectives can be met. Specifically, we stated the shift in health policies since 1994 reflected a shift in emphasis towards favouring the historically disadvantaged. A year ago, we noted with concern that:

‘…this objective has been largely constrained by macro-economic parameters, which have failed to take into account social and economic realities on the ground in determining social spending levels and priorities. In addition it appears that policies favouring fiscal decentralisation may have in fact worsened inter-provincial inequalities.’ [2]

Our concerns were warranted. Despite calls for the redrafted version of the Bill to be sent to the NEDLAC Development Chamber for consideration, detailed submissions, and considerable engagements, these trends are being entrenched.Shifts away from the original vision of our health policy continue unabated and are reflected in the Bill. This complex Bill is an omnibus piece of legislation addressing various entities and sectors of the health care structure. Significant by its absence, is proposed legislation for the introduction of National Health Insurance (NHI), which we comment on later in this submission.

2. Measuring our progress by international yardsticks

One useful tool for measuring the progress of a country in striving to provide a better life for its inhabitants is the human development index (HDI). For South Africa in particular, the HDI is a telling indicator of our health crisis.

As a summary measure of human development, it is premised on three basic dimensions of human development, and is the simple average of these three dimension indices. They are:

· a long and healthy life, as measured by life expectancy at birth;

· knowledge, as measured by the adult literacy weight (with two-thirds weight) and the combined primary, secondary and tertiary gross enrolment ratio (with one third weight); and

· a decent standard of living, as measured by GDP per capita (PPP US$).

Table 1: Human development index trends (1975 – 2001)

Country	1975	1980	1985	1990	1995	2001
Norway	0.858	0.876	0.887	0.900	0.924	0.944
United Kingdom	0.840	0.847	0.857	0.877	0.916	0.930
Mauritius	-	0.654	0.684	0.720	0.744	0.779
Saudi Arabia	0.596	0.656	0.679	0.716	0.746	0.773
*South Africa*	*0.660*	*0.676*	*0.702*	*0.734*	*0.741*	*0.684*
Nepal	0.287	0.326	0.368	0.413	0.451	0.499
Mozambique	-	0.309	0.295	0.317	0.325	0.356
Source: Human Development Report 2003 UNDP (adapted)

From table 1 above, it can be seen South Africa, ranks 111^th out of 175 countries, in terms of HDI ranking. We compare poorly with countries such as Mauritius that has far fewer resources. Between 1995 and 2001, the HDI dropped markedly from 0.741 to 0.684, without a concomitant drop in other countries. Yet, South Africa spends a significant 8.5% of its GDP on health. Clearly, these resources are being used inefficiently, and disproportionately benefit a very small group of people.

3. The primacy of a National Health Insurance Scheme

It is apparent that the Department of Health is reluctant to address various concerns around the private health industry issue. This may be one reason why the financial implications and related matters such as the National Health Insurance scheme has been omitted from this Bill. COSATU and NEHAWU find this unacceptable. The omission will result in the Bill being applied in a system that remains structurally flawed and highly unequal. With this in mind, we call upon the Portfolio Committee to seriously consider this crucial gap in the Bill.

Other than the very short section entitled ‘Financial implications for the State’ (Section 4 of the Memorandum on the Objects of the National Health Bill, 2003), the Bill is completely silent on financing mechanisms for health care delivery. One then has to assume that the current problematic mechanism of funding remains largely intact.

The only reference to some form of national health insurance in the Bill is contained in (section 51). This system makes it obligatory for private health establishments to ‘maintain insurance cover sufficient to indemnify a user for damages that he or she might suffer as a consequence of a wrongful act by any member of its staff or by any of its employees.’ If anything these recommendations would push up the cost of medical aid insurance to the subscriber, thereby making it even more unaffordable to lower income workers. The absence of policy recommendations in the Bill addressing health insurance (other than the example quoted above) prompts us to briefly describe the core proposals of the National Health Insurance Scheme.

Both the 50^th and 51^st Conferences of the ANC, passed resolutions made implement a national health insurance system.

Specifically, the resolution taken at the 50^th ANC Conference in Mafikeng, 1997 called for a National health insurance system and resolved that government find urgent answers to the outstanding, unresolved issues in relation to the social health insurance system so that it can be speedily implemented. [3]

This resolution was more strongly reiterated at the 51^St National Conference of December 2002 in Stellenbosch. The Conference resolved that, as part of attacking poverty and developing a Comprehensive Social Security System, ‘to call on the government to continue with plans towards …, the introduction of a national health insurance’ and that ‘government must speed up the implementation of the recommendations of the commission of inquiry into a comprehensive social security system in the spirit of the Mafikeng conference resolution on the National Health Insurance (NHI). The NHI should enhance the equitable access by the general public to health care and reduce the inequities between the private and public health providers. Specific emphasis should be placed on strengthening the capacity of the public health system to generate revenue from those who can afford to pay and ensure that such revenue is used to improve the public health system’. [4] Yet, the Department of Health has a Directorate for Social Health Insurance – as opposed to National Health Insurance. We consider this a distinct contradiction. It has to be acknowledged that there is no agreement on the issue.

Our submission therefore proposes the development of a chapter for enabling legislation on NHI to be promulgated (see recommendations). However, this may delay the Bill. If this proposal cannot be accommodated, we motivate for separate legislation to address the NHI issues. COSATU would be keen to assist the Portfolio Committee and the DOH with the drafting thereof.

At a minimum, the NHI would:

· fully cover everyone under a single, comprehensive public insurance programme,

· pay hospitals, clinics, nursing homes a total (global) annual amount to cover all operating expenses,

· Fund capital costs through separate appropriations,

· Pay for health professional services and ambulatory services in any of three ways – through fee-for-service payments with a simplified fee schedule and mandatory acceptance of the NHI payment as the total payment for service or procedure (assignment), through global budgets for hospitals and clinics employing salaried doctors, or on per capita basis (capitation),

· Be funded, at least initially, from the same sources as at present, and

· Contain costs through savings in billing and bureaucracy, improved health planning and the ability of the NHI, as a single payer for services, to establish overall spending limits.

The NHI’s structure and financing mechanism is meant to be self-funding, as it will be raised as a levy. The funds raised through the levy would be ring-fenced, and used for medical care for all South Africans.

3.1 SHI vs NHI

COSATU is opposed to the notion of Social Health Insurance (SHI), but advocates for a National Health Insurance (NHI). The SHI is an option being forwarded by cabinet and the DoH as an alternative to the NHI. Table 2 captures the differences between these two systems. COSATU strongly urges for progress in this regard.

Table 2: Main differences between NHI and SHI

NHI	SHI
Will provide the necessary financial base for a National Health System including an employer and employee contribution	Will continue to drain state resources into private health sector, R 8 billion per annum subsidisation through tax relief currently
Funding through a payroll levy tax and progressive taxation system	Co-payment: system of deductibles at point of payment
Establishes a single provider of health care in the country at different levels	Private health system will be entrenched in place, promoting dual system of health care delivery
Coverage is universal for necessary medical services irrespective of ability to pay	Provides for hospital cover – a minimum cover
One single administrative system, but decentralised	Different administrative systems and administrators, problems or rising costs, exclusions, brokerage and re-insurance are not dealt with

Source: p.21 - People’s Budget 2003-4, Proposals from COSATU, SACC and SANGOCO, published in 2002

In a post-Cabinet Lekgotla Media Briefing on 31 July 2003, it was frustrating to learn that ‘a policy approach on Social Health Insurance (SHI) was noted and the implementation strategy will be submitted in detail to Cabinet for approval after the Lekgotla.’ Discussions with senior officials within this Cluster suggesting that this is a staged approach towards a National Health Insurance scheme remain unconvincing. Given the stark differences as outlined in Table 2, an SHI appears to be the inadequate in addressing the huge inequalities in the health sector. COSATU and NEHAWU remain diligent in their attempts to engage government and Parliament in this matter.

4. What constitutes an emergency?

This Bill is by far the most important bill in the health sector. [5] By implication, it is also one of the key pieces of legislation to ensure the progressive realisation of human rights enshrined in the Constitution. Yet we are surprised that the DoH found that ‘emergency treatment is too complex and were advised that it should be defined in regulations section of the Bill.’ Whilst acknowledging in the Preamble that ‘section 27(3) of the Constitution provides that no one may be refused emergency medical treatment’, the Bill does not outline the conditions and specific situations where this must be provided.

Access to emergency treatment is too important an issue to relegate to a mere regulation. Emergency medical treatment means treatment that must be provided immediately on demand by a health care provider or a health care establishment (definition used in Bill)

to a person who has an emergency medical condition, as provided for in section 27(3) of the Constitution.

A shortcoming of the Bill is the absence of a definition for an ‘emergency medical condition’ that could be used to identify the conditions when emergency medical treatment must be provided.

A suitable definition should be provided for an emergency medical condition that would include the following elements, namely:

· an event threatening or causing acute injury or illness which requires immediate preventative or remedial medical intervention; and

· where failure to provide immediate preventative or remedial treatment would result in serious impairment to bodily functions or a serious dysfunction of a bodily organ or part, or death. [6]

It is imperative that the above definitions be defined in law, since it would allow the state to deal with the illegal, but common practice of private hospitals and clinics turning away persons that have emergency medical conditions, such as a heart-attack, poisoning or serious trauma injury. It is immoral to turn away persons requiring such treatment, if they are unable to provide a substantial deposit for private care, are not contracted in to a medical aid scheme that would cover the hospitalisation costs, or have exhausted their medical benefits.

5. Specific recommendations and amendments

Joint submission by Cosatu and Nehawu to the Public Hearing on the National Health Bill