The Competition Commission’s private healthcare market inquiry is a “ruse” set in place by Health Minister Aaron Motsoaledi as a “justification to control prices” in the sector to facilitate the implementation of the National Health Insurance (NHI) scheme, the director of the Free Market Foundation, Jasson Urbach, said on Tuesday. 

The inquiry was launched in early 2014 and is set to hold public consultations beginning next month.

Urbach also accused Motsoaledi of creating a public “narrative” of unaffordable private healthcare in order to manipulate future prices in the interests of the NHI. “Comparatively to other countries, private healthcare in South Africa is not excessively expensive.
If it was, why would we have such a big medical tourism industry?” Urbach asked. 

But the health minister has slammed these comments. Talking to the Mail & Guardian from Davos in Switzerland, where he is attending the World Economic Forum’s annual meeting, Motsoaledi said: “I approached the commission with my hypothesis that private healthcare is too costly and they launched the inquiry to test this hypothesis.

“I did not create the inquiry, it was under the commission’s discretion to launch it. Why don’t they give the commission a chance to reach its conclusions? What are they scared of?”  

Motsoaledi said, while private healthcare may not be too expensive for Europeans earning in pounds or euros, the situation is entirely different for South Africans earning in rands. “To use medical tourism as a way to measure the affordability of private healthcare is unscientific and makes me doubt the credibility of the Free Market Foundation,” he said.  

Following a waiting period of four years after the publication of the green paper, the NHI white paper was released on December 10 last year. It provided a plan of significant reforms to both the public and private sectors with the aim of making affordable good quality healthcare accessible to all South Africans.

The white paper suggests that the NHI will contract healthcare services from the private sector where the government lacks facilities and staff and that medical schemes, in their current form, will cease to exist. Instead, by 2025, medical schemes will only be allowed to provide top-up cover to pay for services such as elective cosmetic surgery that will not be covered by the NHI.

According to Urbach, if the white paper’s suggestions are implemented, the quality of private healthcare will drastically decline, as it is currently funded through medical scheme payments. “The already squeezed middle class will no longer be able to afford medical scheme contributions on top of suggested NHI contributions,” Urbach said. 

But Motsoaledi responded: “This argument merely protects the interests of the 8-million people [out of a population of 52-54 million] who are currently able to afford medical schemes. What about the rest of South Africans who have no choice?”