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Cabinet gives go ahead for shake-up of health-care sector
Business Day
2005-07-29

The cabinet has agreed to the creation of a risk equalisation fund to ensure access to health care for all South Africans, President Thabo Mbeki said yesterday.

While only a minority (of South African citizens) had access to private medical aid, larger amounts of money were spent in the private sector than in the public sector, Mbeki told a media briefing in Pretoria, following this week's three-day cabinet lekgotla.

There was a need to rearrange the financing of the sector, he said.

The cabinet said it had reaffirmed the principle of a health system in which all South Africans were adequately cared for.

This requires ... the creation of structural linkages between public and private sectors, minimum guaranteed packages to all, and the prevention of unfair exclusion of low-income groups, the cabinet said. It was agreed ... that in the immediate measures should be introduced to ensure risk equalisation among the various private medical schemes.

Mbeki said the matter would be discussed with labour unions.

Last month, the health department said it had started trials in the private sector to evaluate a risk equalisation fund. This was aimed at reducing monthly medical aid payments to R193 for all.

The initiative seeks to balance medical aid premiums between the chronically ill and the healthy through risk balancing and cross-subsidisation. The fund is one of three pillars of the government's social health insurance policy. (Source: Businessday, 25 July 2005)

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