The future and sustainability of private medical care in South Africa

Loubser, Petrus Abel (2007-12)

Thesis (MBA)--Stellenbosch University, 2007.

Thesis

ENGLISH ABSTRACT: This study provides an overview of the medical aid industry in South Africa and highlights the impact of the formation of the Council for Medical Schemes through the implementation of the Medical Schemes Act of 1998. The regulatory framework that governs the medical aids in South Africa is analysed. In this study. different medical aid funds are compared in terms of administration costs, required solvency levels and membership numbers relative to the acceptable industry averages. The main cost drivers of medical aid funds that could also threaten the future of private medical care are identified, as these services may not be affordable to most South Africans in the future. The new vision of government in terms of healthcare is outlined, and the regulations that will be implemented to transform the healthcare sector into a Social Health Insurance system, and ultimately into a National Health Insurance system. are analysed. The proposed mechanisms, such as the Risk Equalisation Fund, the Government Employees Medical Scheme and lowincome medical schemes, are discussed, highlighting all their advantages as well as the associated risks for the sustainability of private medical care. The proposed new legislation and the potential negative financial impact on the private medical industry are analysed with detailed reference to the Medical Schemes Act of 1998 and the Medicines and Related Substance Control and Amendment Act of 1997. The implications of fundamental changes proposed in private health insurance, such as community risk rating versus the traditional individual risk rating, are discussed. The negative impact of prescribed minimum benefits (which include HIV/Aids) on the financial sustainability of the medical aid industry is highlighted. The impact of HIV/Aids on the sustainability of the medical aid industry is discussed and some conclusions and recommendations are made regarding the financial sustainability of the medical aid industry and hence the future of private medical care in South Africa.

AFRIKAANSE OPSOMMING: Hierdie studie is 'n oorsig van die mediesefondsbedryf in Suid·Afrika, en beklemtoon die impak van die totstandkoming van die Raad van Mediese Skemas deur die impJementering van die Wet op Mediese Skemas van 1998. Hierdie regulatoriese raamwerk, wat mediese fondse in SuidAfrika tans reguleer, word in die studie ondersoek. In hierdie studie word van die grootste mediese fondse in tenne van administratiewe koste, voorgeskrewe fondsreserwes en lidmaatskapgetalle relatief tot die aanvaarde bedryfsnonne met rnekaar vergelyk. Die belangrikste koste-items vir mediese fondse wat die voortbestaan van privaat gesondheidsorg kao bedreig, word ontleed cmdat hierdie dienste in die toekoms vir die rneeste Suid-Afrikaners onbekostigbaar kan word. Die regering se nuwe visie vir gesondheidsorg word uiteengesit. asook die regulasies wat germplementeer sal word om die gesondheidsektor na 'n sosiale gesondheidsversekeringstelsel en uiteindelik na tn nasionale gesondheidstelsel te transfonneer. Die voorgestelde meganismes, seos die Risiko-egalisasiefonds, GEMS en laeinkomste-mediesefondse word bespreek, met al die relevante voor- en nadele, tesame met die geassosieerde risiko's vir die voortbestaan van privaat mediese dienste. Die voorgestelde wetgewing en die gevolglike negatiewe finansiele impak op die privaat gesondheidsbedryf, met spesifieke verwysing na die Wet op Mediese Skemas van 1998 asook die Wet op die Beheer van Medisyne en Verwante Middels van 1997, word ondersoek. Die implikasies van fundamentele veranderinge wat in terme van gesondheidsversekering voorgestel word, soos gemeenskapsrisikogradering teenoor individuelerisikogradering, word bespreek. Voorgeskrewe minimum voordele (wat MIV insluit) wat nou ingevolge wetgewing ten volle deur fondse betaal moet word, se potensiele negatiewe impak op die finansiele lewensvatbaarheid van mediese fondse word beklemtoon. Die potensiele negatiewe impak van die MIV-epidemie op die lewensvatbaarheid van die mediesefondsbedryf word bespreek en gevolg deur aanbevelings om die fmansiele lewensvatbaarheid en toekoms van die privaat gesondheidsbedryf in Suid-Afrika te verseker.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/21186
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