In a recent radio interview the Minister of Finance declared that 20 per cent of the population receives private health care while the government is responsible for providing health care to the remaining 80 per cent. We need to be concerned when such an astute minister becomes persuaded by fallacious and persistently quoted figures, especially if the figures are used to formulate budgetary and overall government policy.
The minister rounded off the figures the mantra constantly appearing in government documents has been that government provides health care to 84 per cent and the private sector to 16 per cent of the SA population. This fallacy has its origins in the fact that in 2001 approximately 16 per cent of the population were members of private medical schemes. Since then, governments policy documents have contained the sweeping assumption that anyone who is not a member of a medical scheme can automatically be claimed as a government patient. The many people who do not belong to medical schemes but also do not rely on government-provided health care can attest to the fact that the 84/16 assumption is incorrect.
The Draft Charter of the Health Sector of the Republic of South Africa, published in 2005, repeated the claim that a small minority of South Africans (between 15 and 20 per cent of the population), have a high degree of access to health services and a large majority (between 75 and 80 per cent), have either limited access or no access at all. The high degree of access refers to that proportion of the population who can afford private health care and the large majority to those who, if they need it, obtain health care in the government health sector.
Accurately determining the percentage of the population that is dependent on the government health sector is of vital importance to health policy. It is even more important to determine how many people actually use government health services, the frequency of that use, and nature of the services they utilise. The possibility that some people may, or are entitled to, use a particular service does not mean that they will do so. Future policies based on incorrect figures for the respective quantities of services provided by the government and private health services, will have serious consequences for future health-care delivery. It is thus essential that an effort be made to obtain a better understanding of the existing situation.
A cursory glance at the available hospital and hospital bed statistics appear to support the governments claim that the government sector supplies health-care services to all but a small proportion of the population. In 2004 there were 410 public hospitals with 105,665 beds (79.6%), and 204 private hospitals with 26,593 beds (20.4%). However, on closer examination, and bearing in mind that accurate numbers are not readily available, indications are that the private health sector provides medical services to nearly half of the South African population.
According to official figures, South Africa had a population of 44.8 million people in October 2001. Poverty estimates range from 40 per cent to as high as 60 per cent of the population. Based on a poverty datum line of R800 per month for a household, 52 per cent of households lived in poverty in 1996. It would thus be safe to conclude that in 2001 at least half the population, or 22.4 million people, could not afford comprehensive formal health care.
Research showed that in 1999 about 20 per cent of the population had private medical insurance cover, consisting of medical scheme membership, other forms of health insurance, and workplace health services provided by private firms. At that time it was estimated that potentially 30 per cent of non-scheme members (nearly 25 per cent of the total population) used private health services on a direct payment basis. The implication is that in 1999 nearly 45 per cent of the population used private health care. Furthermore, those who paid out of pocket used either private or government care, while some used both, as did members of medical schemes.
Figures published by Statistics South Africa reveal that annually since 1995 at least one third of households consulted private health providers:
| Place of consultation 1995 2005 |
| Place of consultation | 1995 | 1998 | 2002 | 2005 |
| Government sector | 67.8 % | 69.4 % | 57.8 % | 59.9 % |
| Private sector | 32.2 % | 30.6 % | 42.2 % | 40.1 % |
According to the National Health Accounts, in 1995 28.8 per cent of the population who were not covered by medical aid, made use of private health services. Ten years later the General Household Survey 2005 found that just over 40 per cent of all consultations took place in the private sector in that year and that 55.4 per cent of the consultations in the private health sector were for patients not on medical aid. Clearly the private health sector is used by substantially more than the 16% of the population claimed by government.
Consider also the results of a study on the market potential for medical schemes, undertaken by a private medical insurer, which estimated that in 2001 16 per cent of the population was covered by medical insurance, that a further 30 per cent could afford medical insurance but were not insured, and that 54 per cent were unable to afford medical insurance. Among this last group are some who purchase private health care on an irregular basis and would not automatically become government health-service patients.
An assessment of the available information leads to the conclusion that the government health sector spends taxpayers money on a potential 54 per cent of the population (24 million people in 2001) and not 84 per cent as claimed. The real usage of health services ranges between 16 per cent and 46 per cent of the population using private health care, and potentially between 54% and 84% using the government health sector.
Consider further that relatively few people actually need medical care in any given year, and those who get sick suffer from a wide range of illnesses requiring a range of treatments, which differ in cost of provision. According to the General Household Survey 2005, 10.3 per cent of the SA population consulted a health worker (doctor, nurse or traditional healer) and 6.5 per cent of the population received some form of medical treatment at hospitals and clinics in that year. By comparison, in 2003 in the United States hospital admissions amounted to 10.7 per cent, or 36.6 million people out of a population of nearly 291 million.
Because only a small proportion of a population requires medical treatment in any given year, and considering that many people rarely need medical treatment, claims that the public health system serves 84 per cent of the population and the private sector 16 per cent, misrepresents the actual situation. Clearly, more accurate figures are required on which to base health care policy.
Author: Johan Biermann is a planner and policy researcher and the author of
South Africas Health Care Under Threat, published jointly by the Health Policy Unit of the Free Market Foundation and the International Policy Network (London). This article may be republished without prior consent but with acknowledgement to the author. The views expressed in the article are the authors and are not necessarily shared by the members of the Free Market Foundation.
FMF Feature Article / 19 December 2006