South Africa’s private hospitals are ‘profit-driven hotels for patients’

(This article was published in the Weekend Argus, a weekly newspaper in the Western Cape province, South Africa, on March 12 2016.)

Written by Yazeed Kamaldien

Private hospitals were yesterday depicted as profit-driven hotels for patients who were often sent to public hospitals once their money had run out.

This was part of the national health department’s presentation the Competition Commission’s ongoing inquiry into the reasons for the private health sector’s rising costs.

The inquiry’s public hearings were held for three days this week and also last week at the Cape Town International Convention Centre.

Health minister Aaron Motsoaledi told the commission about his run-ins with the private health sector and how he prefers to use public health services.

Motsoaledi said he spent R14,000 a month for his medical aid plan but was told in October already that his funds had been depleted.

He also recalled how he once needed an ambulance to take his son to a private hospital, but was told he needed to pay an extra R5,000 in cash for that service.

“And the person on the phone told me they didn’t believe that I could pay the R5000,” said Motsoaledi.

He added: “The impression is often that the private sector comes to the rescue of the public sector, but this is not necessarily so.

“Private hospitals charge so much that patient plans can’t even afford it. Patients are then transferred to public hospitals.”

Motsoaledi said private hospitals meanwhile could pay professionals high fees and employed 80% of the country’s specialists for 16% of the population – the amount that can afford private healthcare. This left the public health sector with much fewer specialists for more patients.

Motsoaledi said the fundamental problem was that the private and public health sector had “completely different” ideas about healthcare.

“Our definition of health is completely different to theirs,” he said.

“I’ve been accused man times of fighting the private health sector. It’s been said NHI (government’s National Health Insurance plan) is meant to kill the private health sector. It’s not our intention.”

Anban Pillay, the health department’s deputy director-general for health regulations and sector-wide procurement, meanwhile showed with figures how the private health sector was allegedly ripping off patients.

Pillay said private hospitals were the biggest culprit, having pushed up costs to prioritise profit instead of patients.

Pillay pointed to a number of private hospitals that are publicly listed companies on the Johannesburg Stock Exchange.

“I don’t want to suggest that listing on the stock exchange is a bad thing,” he said.

“But investor expectation needs to be managed when we look at healthcare. The primary objective should be the patient.”

Pillay also showed price differences in the private and public sector for the same medical procedures.

Medical male circumcision, for example, would cost R1,121 when performed by a general doctor. In the private health sector the same procedure cost R7,130.

Pillay showed in many cases the cost of surgery in South African private hospitals was higher than numerous developed countries and second only to the United States in cost for patients.

Relying on statistics from 2010, Pillay showed the private health sector spent R84,7-billion that year. Of that, R30,8-billion went to private hospitals and R1,5-billion went to brokers.

Motsoaledi said brokers needed to be cut out completely to save consumers cash. He said their fees had increased 800% from 2000 to 2005.

The commission’s hearing form part of a three-year investigation into the rising costs of private healthcare in South Africa. The next round of hearings are scheduled for Pretoria from March 29 to 31.

The commission is expected at the end of this year to release its recommendations to address the costs of private healthcare.

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About Yazeed Kamaldien

Self-employed journalist and photographer from South Africa.

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