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5 things we know so far about how NHI will be financed

 15:28 29/08/2019  Lameez Omarjee, Fin24

Health crisis as 40% of Gauteng’s public hospitals don’t have CEOS

The Gauteng Department of Health has revealed that at least 12 of the province’s hospitals do not have permanent chief executive officers. The province has 32 public hospitals under the department’s authority.

The National Health Insurance Bill is not a money bill and the finance minister is ultimately responsible for determining how the programme will be funded, Health Minister Zweli Mkhize has said.

Mkhize and other officials from his department on Thursday briefed Parliament’s portfolio committee on health on the fund set to underpin NHI.

NHI, which government wants to have fully implemented by 2026, will see South Africans subscribing to a national health insurance fund in a bid to provide comprehensive healthcare services equitably at private and public healthcare facilities.

Mkhize tabled the bill in Parliament earlier in August. As News24 previously reported, the DA has questioned the constitutionality of the bill. 

Briefing the committee on Thursday, Mkhize said that the bill was overseen by the State Law Adviser before being tabled and was consistent with “Constitutional principles”. Committee chairperson Sibongiseni Dhlomo added that Parliament would hold public hearings on the bill to ensure it was in line with the Constitution.

On the issue of finances, Mkhize said the health department had been holding engagements with Treasury.

“There has also been continuous interaction between Department of Health (DoH) and Treasury when it comes to the management of the bill.

“Those issues have been taken care of. We will obviously have ongoing interactions at that level,” Mkhize said.

He added that the DoH had taken into account Cabinet’s request to indicate possible sources of funding.

“It is not a money bill. Only the finance minister has the competence to table such a bill. That is not what we are doing here,” Mkhize said.

The bill contains a section on financial matters, which Deputy Director General on NHI Anban Pillay unpacked.

This is what we know so far:

1. Where will the funding be sourced?

Funding will come in the form of appropriations, fines, interest and bequests.

2. Who decides on funding?

The chief source of income will be appropriations from Parliament.

3. What does it mean for my taxes?

Funding will be derived through general tax revenue; shifting funds from the provincial budgets and conditional grants, and reductions in medical scheme tax credits; payroll taxes; and a surcharge on personal income tax, said Pillay.

4. Who audits the fund?

The Auditor General of South Africa will audit annual reports.

5. Who has oversight of the fund?

The fund must produce annual reports to be submitted to Parliament and the Health Minister. The audited finances must also form part of the report. Additional reporting elements include the activities undertaken and progress made.