Mr. J. Cronin
The Chairman
Portfolio Committee on Transport
Friday, October 24, 2003
Dear Sir,
RE: The Road Accident Fund Second Amendment Bill, 2003 (Hospital Association of South Africa). Second Submission.
Introduction.
HASA represents the views of the private hospital industry in South Africa. This industry plays a key role in the delivery of health services in the private sector, and therefore in the country's health system as a whole. Therefore, the views contained in this response are those of an industry that:
Has a market capitalization of R10,5 billion, which represents the value of monies invested by pension funds, life insurers, unit trust funds, corporate and other private investors in the listed hospital groups. This does not include the investment made by shareholders in a further 22% of private hospitals that are not listed. (Based on 2001 figures).
- Provides inpatient services to about 1,6 million patients per annum, involving 4,5 million bed-days
- Supports the services of approximately 4000 medical doctors who in many cases would have left the country if they did not have an opportunity to pursue careers and skills development in the private sector. Of these a meaningful proportion have academic appointments in the public sector.
- Employs and trains over 60000 nurses and other support staff
- Pays about R4 billion to the pharmaceutical and medical supplies industries
- Invests about R1,3 billion per annum in the maintenance and upgrading of medical technologies and service infrastructure.
- Generates R1,2 billion per annum in taxes (including VAT)
- Generates an increasing amount in foreign currency revenue from foreign and expatriate patients
- Generates employment in labour intensive outsourcing service organizations including laundry services, cleaning, catering, and maintenance for example.
Without diminishing our support for the goal of "access to health care for all", and our acceptance of the need to shift the paradigm towards alternative models of health care delivery, HASA offers its perspectives in the interest of the following key stakeholders that depend on the industry in one-way or another:
- Local and international private (self-funding) patients.
- Employers including the State as employer.
- Medical scheme beneficiaries.
- Private hospital stockholders
- Persons employed by the hospital industry.
- Professional practitioners and their staff.
- Suppliers of pharmaceuticals, medical supplies and consumables, and their staff.
- Government in its role as representative of the interests of the electorate.
The Membership of HASA.
- The private hospital sector is made up of three major groups, namely: Afrox Health Care, Netcare and Mediclinic.
- 26% of HASA membership can be allocated to Afrox Health Care, and amounts to 6471 beds in total.
- 30% of HASA membership can be allocated to Netcare, and amounts to 7129 beds in total.
- 22% of HASA membership can be allocated to Mediclinic, and amounts to 5485 beds in total.
- 16% of HASA membership is made up of 'independent members' (hospitals not owned by a group), and amounts to 3969 beds in total.
- The remaining 6% is constituted of 'Associate Members' (members of HASA who do not have voting powers), and amounts to 1372 beds in total.
- The total number of private beds in terms of HASA membership for South Africa is 24042, and constitutes 182 hospitals.
- See table for geographic location.
The Public Sector.
- The National Department of Health is responsible for the allocation of licences, unless a particular province in terms of its own law has a dual competence in this regard.
- There has been a moratorium in regards to new hospital licences for approximately three years.
- The total number of beds in the public sector (as of July 2002) is 106563, and constitutes 405 hospitals.
- No reference is made to 'private beds' in public sector facilities, and accordingly there is no clarity in this regard.
- See table for geographic location.
TOTAL NUMBER OF PATIENT BEDS. |
Private sector (HASA) 24042
No. of hospitals 178 |
Public Sector 106563
No. of hospitals 405 |
TABLE.
|
Number of HASA hospitals / beds per national province June 2002 |
Number of hospitals / beds in public hospitals per province December 2001
|
Province |
Beds |
Hospitals |
Beds |
Hospitals
|
Eastern Cape |
1 327 |
14 |
19 453 |
91 |
Free State |
1 233 |
9 |
7 075 |
34 |
Gauteng |
11 770 |
76 |
16 845 |
30 |
KwaZulu-Natal |
3 515 |
26 |
827 795 |
73 |
Limpopo |
193 |
1 |
11 582 |
44 |
Mpumalanga |
824 |
6 |
4 826 |
29 |
Northern Cape |
346 |
5 |
6 522 |
22 |
North West |
1277 |
11 |
1 608 |
26 |
Western Cape |
3 829 |
32 |
10 857 |
56 |
RSA Total |
24 314 |
180 |
106 563 |
405 |
Namibia |
72 |
1 |
- |
- |
Swaziland |
40 |
1 |
- |
- |
Southern Africa Total |
24 426 |
182 |
- |
- |
The Road Accident Fund Second Amendment Bill, 2003.
- Consultation.
HASA has not been consulted in regards to the abovementioned Amendment Bill, and is concerned about its far-reaching provisions, in particular as they relate to the delivery of health care in South Africa. Accordingly, we are of the opinion that serious consideration should be given to the potential consequences of such law, as well as the potential for a legislative inconsistency when compared to the Bill of Rights as contained in our Constitution.
- "Prescribed Tariff".
Reference is made in section 17(5) of the proposed amendment to the compensation of a third party in terms of the medical costs incurred, in accordance to a 'prescribed tariff'. There is no concurrent reference to what constitutes 'prescribed tariff', nor is there any reference to how that tariff would be formulated (if any). HASA objects to the following:
- Section 81 of the Competition Act, specifically stipulates that the State is bound by the provisions of Competition law, and accordingly would have to ensure that section 4 prohibitions are not violated in the publishing of a 'prescribed tariff'. Accordingly, the Road Accident Fund, would have to ensure that the 'tariff' it utilises is effectively negotiated within the parameters of law, and not published in contravention of the aforementioned Act.
- HASA is further of the opinion, that should the Road Accident Fund argue that as a 'non competitor' it would have the right to publish such a tariff, it would still have to ensure that the 'tariff' is reasonable, justifiable and administratively fair. Accordingly, it would have to establish a mechanism by which the provider industry would have the right to 'negotiate' an appropriate fee for medical services rendered in good faith.
- HASA is further of the opinion, that the State is now a competitor with the Private Sector, in that it is rendering services to medically insured patients (or more accurately private patients). It is therefore, our submission that the Universal Patient Fee Schedule (UPFS), as published and utilised by the State, is not a tariff applicable to the private sector, and should it be enforced by the Road Accident Fund, then such sector would have no other alternative but to reserve its rights in terms of Competition law.
- HASA would recommend, that provision be made in law for a reasonable tariff, as determined by the Fund and the provider, through a mechanism of negotiation. Furthermore, that such mechanism be within the provisions of Competition law, and that the Fund ensure that every effort is made to ensure effective representation of the private sector in such determination.
- Cognisance must be given to Section 90(1)(u) of the National Health Bill, 2003 which stipulates that:
90(1) The Minister may after consultation with the National Health Council, may make regulations regarding-
(u) the process of determination and publication by the Director-General of one or more reference price lists for services rendered, procedures performed and consumable and disposable items utilised by catagories of health establishments, health care providers or health workers in the private sector which may be used-
- by a medical scheme as a reference to determine its own benefits; and
- by health establishments, health care providers or health workers in the private sector as a reference to determine their own fees,
but which are not mandatory:
- It is HASA's submission that the current provisions of law, as contained in the Road Accident Fund Second Amendment Bill, 2003, may be inconsistent with national law (as proposed), as well as Competition law as stipulated in the Competition Act, 1998.
- Emergency Medical Treatment.
HASA is concerned that the proposals in regards to 'emergency medical treatment' may be inconsistent with the National Health Bill (as proposed), as well as the Constitution of the Republic of South Africa. Furthermore, the proposed amendments may be inconsistent with the ethical rules applicable to all 'health professions' as registered in terms of the Health Professions Act. In particular, HASA cites the following:
- The Ethical Rules of the Health Professions Council, states that no practitioner 'may refuse to treat "a patient in an emergency." Furthermore, no distinction is made between citizens of South Africa and non-citizens. In addition, no distinction is made between residents of South Africa, and non-residents. Accordingly, in so far as the Amendment seeks to limit the liability of the Fund to 'residents' of South Africa, this may be inconsistent with the ethical rules of the profession, and may also be unconstitutional.
- Furthermore, section 27 of the Constitution of the Republic stipulates that: "no one may be refused emergency medical treatment". Similarly, no distinction is made between citizens of South Africa and non-citizens. In addition, no distinction is made between residents of South Africa, and non-residents. Accordingly, in so far as the Amendment seeks to limit the liability of the Fund to 'residents' of South Africa, this provision may be unconstitutional. Furthermore, should the Fund refuse to compensate for such treatment on the basis of such person being a 'non-resident', may expose the Fund to claims based on constitutional discrimination, as well as denial of emergency medical treatment.
- Furthermore, section 5 of the National Health Bill (as proposed) stipulates that: " A health care provider, health worker or health establishment may not refuse a person emergency medical treatment". Similarly, no distinction is made between citizens of South Africa and non-citizens. In addition, no distinction is made between residents of South Africa, and non-residents. Accordingly, in so far as the Amendment seeks to limit the liability of the Fund to 'residents' of South Africa, this provision may be inconsistent with national health law.
- HASA, is therefore of the opinion that the Amendment as read with the provisions relating to a 'prescribed tariff' may result in situation where the private sector incurs manifest debt, due to its constitutional obligations, and the anomaly of law as contained in the proposed amendment.
- Furthermore, HASA is concerned that the Fund by these amendments is placing an extreme obligation on providers of a health service, who render their services in good faith to patients in need, without providing a reasonable administrative mechanism for fair, reasonable and justifiable compensation.
- Emotional Shock.
HASA is concerned that the proposed Amendment in relation to the non-payment of claims relating to "emotional shock' may be unconstitutional, in so far as it directly discriminates against mental health care users (as defined in the Mental Health Care Act). Furthermore, the proposed amendment may be inconsistent with the provisions of law as contained in the Mental Health Care Act, and the general prohibition of discrimination based on a patient 's (or person's) mental illness. In particular, HASA cites the following:
- The Medical Schemes Act, 1998, expressly states that no Fund may
- Although there has been a plethora of recent legislative intervention around health care delivery in South Africa, mental health remains an area of concern where many argue that there has been insufficient legal emphasis given to the position of mental health, and that of mental health care users. Argument has been mooted for a radical overhaul of South Africa's attitude to mental health, which in would have the effect of encouraging positive legislative change, and the prevention of unfair discrimination and/or treatment of mental health care users.
- In this regard, the Constitution of the Republic of South Africa [Act 108 of 1996] states in section 9(1) that: "the State may not unfairly discriminate against directly or indirectly against anyone on one or more grounds, including race, gender, sex, pregnancy, marital status, ethnic or social origin, colour, sexual orientation, age, disability, religion, conscience, belief, culture, language and birth.". Accordingly all sectors within the jurisdiction of that Constitution, are duty bound to ensure that no person is denied "equal protection and benefit of the law".
- This read together with the new Mental Health Care Act, which in section 10(1) states that: "A mental health care user may not be unfairly discriminated against on the grounds of his or her mental health status".
3.5. These challenges are not unique to South Africa, and internationally there has been a marked move towards eradicating 'discrimination' in regards to mental health benefits, treatments and funding. In particular, the National Association of State Mental Health Programme Directors in the United States found when researching its own medical insurance market that:
Despite growing understanding that appropriately managed mental health benefits can be highly cost-effective, most private insurance remains inadequate. Ninety-eight percent of all plans limit outpatient care, and 80-85% limit inpatient care. Approximately 50% of private plans impose a 30 to 60 day limit on hospitalisation. Three quarters of health plans impose dollar or visit limits for outpatient care. Limits should be based on medical necessity as determined by the appropriate management of care, rather than arbitrary limits that do not recognise the state of today's mental health care.
- Medical advisors, practitioners and other health professions would be wise to consider that health care legislation does not exist in isolation, and that numerous other Acts of parliament provide directly and/or indirectly for the mentally ill, and some expressly prohibit either the 'direct' and/or 'indirect' discrimination of such individuals.
- The Promotion of Equality and Prevention of Unfair Discrimination Act for example provides comprehensive law as it relates to persons with disabilities, and stipulates that such individuals shall be protected against being unfairly discriminated on the basis of their disability. In particular, such individuals shall be protected against being denied 'any supporting or enabling facility necessary for their functioning in society', as well as ensuring that such individuals are afforded the right to 'enjoy equal opportunities'. The aforementioned Act goes even further, by specifically stating that it is an unfair practise to "unfairly deny or refuse any person access to health care facilities or to fail to make health care facilities accessible to any person".
- The Employment Equity Act also provides that employees with a disability shall not be unfairly discriminated against. It defines 'disability' as people who have 'a long-term or recurring physical or mental impairment which substantially limits their prospects of entry into, or advancement in, employment."
3.8. Internationally the United States of America, has introduced specific legislation to eradicate discrimination in regards to the disabled and/or the mentally ill, and promulgated the Medicare Mental Health Modernisation Act, 2001.
- Undertakings.
HASA is concerned about the practical implications of this proposed amendment, and submits that within the context of emergency medical services, as well as future medical expenses, this law may be impractical and difficult to apply.
- Clause 2(a) and 2(b) of the proposed Amendment may have the direct consequence of prejudicing claimants on the basis that such may not be able to pay for hospital expenses, medical practitioners and their services, on the basis that these amounts have not been incurred, and thus makes moot the intentions behind such undertakings.
- HASA's previous comments in this regard remain valid, and reference is drawn to the submission entitled "Assessment of the Road Accident Fund Second Amendment Bill, 2003 and Proposals to be made by the Coalition."
Submission drafted by: Adv. K. Worrall-Clare
For the members of HASA.