Harnessing the private health sector by using prices as a policy instrument: Lessons learned from South Africa

Building an inclusive social protection system in South Africa

“…Moreover, it will play an important role in the NHI framework. OECD analyses found prices in the private sector particularly high for an emerging country (Kumar et al, 2014, Barber et al, 2018, and Lorenzoni and Roubal, 2016. However, spending in the private sector has also been driven by increasing consumption of health services.…”

“…Such a system is necessary for the introduction of the NHI as it will allow comparing public and private providers and defining the reimbursement level for the different types of health care. Across OECD countries, price-setting norms and institutions have developed over a long period of time and are, in many cases, the outcome of negotiations between the health sector and government (Barber et al, 2018). South Africa needs to develop a national coding system combined with disease classifications, commonly agreed with all health actors that serve as the common language by which medical services are recorded and billed.…”

“…South Africa needs to develop a national coding system combined with disease classifications, commonly agreed with all health actors that serve as the common language by which medical services are recorded and billed. Several OECD countries have established hospital pricing schedules that incorporate relative cost weights and allow for the comparison of resource intensity and complexity of most hospitals (and in some cases, out-patient) services (Barber et al, 2018).…”

“…OECD analysis recommends that the process of going from codes to price schedules be entrusted to an independent body to guarantee integrity and independence (Barber et al, 2018). Also the competition commission has recommended to set up such an independent body with the participation of physicians' associations, hospitals and other health professionals, along with medical schemes and the government.…”

Other considerations than: how much will universal health coverage cost?

“…3 However, as the privately insured accounted for only 16% of the population, this high level of expenditure did not benefit everyone equally. 12 In fact, private spending moved South Africa further from UHC by increasing resource inequities between the public and private sectors.…”