How the 2024 National Budget (Hopefully) Indicates a Pragmatic Approach to NHI

How the 2024 National Budget (Hopefully) Indicates a Pragmatic Approach to NHI

As the impending National Health Insurance (NHI) bill looms large on South Africa's political horizon, it’s critical that we take a pragmatic approach to its implementation. President Cyril Ramaphosa’s remarks at SONA followed by Minister Enoch Godongwana 2024 Budget, coupled with the palpable urgency within government structures to use the bill for its electioneering, indicate a swift progression towards its enactment. But, we must not overlook the daunting constraints that accompany such a monumental undertaking, writes Yugen Pillay Head of Public Sector at BDO South Africa.

Undoubtedly, the NHI represents more than just a healthcare reform bill; it’s a symbolic assertion by the governing party of its commitment to address the nation's healthcare disparities. But amid the fervour surrounding it, we cannot afford to ignore the elephant in the room — the budgetary constraints that threaten to stifle its realisation.

At the heart of the matter lies a simple yet important question: Can we afford the NHI?
Despite its noble intentions, the stark reality is that our current fiscal landscape is ill-equipped to shoulder the financial burden it entails. With a burgeoning budget deficit, less than desirable growth, and dwindling tax revenues, the prospect of financing the NHI through conventional means appears increasingly untenable.

In his 2024 Budget Speech, however, Minister Godongwana set aside R1.4 billion for the next financial for the scheme. This reiterates the government’s intention to begin rolling out NHI, but to what extent? While some estimate NHI to cost around R200 billion in total, it’s true cost remains unknown. Then there’s the matter of the state of our current healthcare services.

Consider that almost 800 qualified doctors are currently without jobs in the country due to budget constraints. So even if we have the necessary facilities, we can't even afford to place the doctors we currently have, let alone the many more we’ll require. That’s not to mention the exodus of skilled medical practitioners, which presents a further obstacle. How can we hope to implement a comprehensive healthcare scheme when we lack the necessary workforce to sustain it?

Healthcare is the heartbeat of the nation, and there’s no point having a system that doesn’t work, leading to a population that’s continuously sick. That in turn impacts productivity and the economy, creating a vicious cycle.

So instead, to navigate these challenges, we must adopt a multifaceted strategy that prioritises economic growth and human capital development. Rather than rushing headlong into NHI implementation, we should focus on laying the groundwork for its success. This entails devising a comprehensive budgetary plan, at least a three-year phased implementation strategy, and concerted efforts to retain our medical talent.

In his speech, Minister Godongwana did identify several areas where the NHI still needed to be developed before its rollout. This should provide some comfort as it indicates a realisation by government that in its current form they cannot afford to fully implement the scheme.  But what are some of the ways the country can better prepare itself for the inevitable rollout of NHI?

Crucially, we must engage with healthcare professionals to understand their concerns and address the systemic issues driving their departure. By fostering an environment conducive to their growth and development together with the Health Professions Council of South Africa (HPCSA), we can stem the brain drain and fortify our healthcare infrastructure from within.

Furthermore, we cannot afford to overlook the invaluable expertise of our senior specialists. Their mentorship and guidance are indispensable in nurturing the next generation of healthcare professionals and optimising the utilisation of our existing resources.

Although the Minister acknowledges that further developments are required before NHI can be rolled out at scale, the incoming seventh administration — even if it’s a coalition government — may be more aggressive in implementing the scheme, in a show to radically transform the health sector. That said, for now reason and logic prevails.   

Ultimately, the success of the NHI hinges not only on its legislative passage but on the concerted efforts of all stakeholders to address the underlying constraints and seize the opportunity to redefine the future of healthcare in South Africa. It’s incumbent upon us to rise to the occasion and ensure that the promise of universal healthcare becomes a reality for all South Africans, without compromising the fiscal integrity of our nation.