Restructuring the National Health System for Universal Primary Health Care

Official Policy Document Issued by the Department of Health Restructuring the National Health System for Universal Primary Health Care

1. Background/Introduction

The Department of Health and the nine provincial health administrations recently released a report titled Restructuring the National Health System for Universal Primary Health Care that discusses their plans for restructuring the health system in South Africa. This document updates an earlier report submitted by the Committee of Inquiry into a National Health Insurance System to Minister NC Dalimini Zuma in June 1995. Approximately 250 written submissions were received on the Committee of Inquiry's report. These comments were analysed and included in this document. There are two major sections to the policy document: policies and funding of the public national health system and proposed regulatory reforms in the private health sector.

2. Implementation

Implementation of the transformation of the entire health system is expected to take up to eight years. Some parts of the plan will be implemented sooner. This is a national policy framework. It is not a detailed implementation plan. Further work must be done at the national and provincial levels to operationalise these plans. In addition, provinces have the competency and the authority to modify these recommendations to meet local needs and conditions.

3. The New Primary Health Care System

The report briefly reviewed the current situation of the health system and justified the need for major restructuring. According to the Department, the health policies set out to achieve:

• Substantial visible and sustainable improvements in publicly funded primary care services.
• Improvements in the funding efficiency and governance of the public hospital system.
• Improvements in the equity and efficiency of the private system and the relationship between the public and private sectors

• 3.1 Principles

  In designing the new system, the Department adopted the following principles:

  • • Universal access
    • Strengthen the public health sector
    • Strengthen the district health system
    • Comprehensive Primary Health Care (PHC) approach
    • Mix of public and private services
    • Choice of individuals to use private providers and buy insurance
    • Emphasize the needs of the users and empower them to participate in governance
    • Outcome driven and emphasis on quality of care
    • Decentralised management

  3.2 Primary Health Care Package

  The document presents a target set of primary care services that should be provided in each district when the new system is in place in 8-10 years. Until then, the services available may be more limited in some districts than other districts depending on available resources. The level of services should expand over time, but decisions on whether specific services are provided or not will be taken at the provincial and district levels. The target list of primary care services includes both personal and non-personal services. Many non-personal services, such as water, sanitation, and environmental health services will be provided in collaboration with other government Departments.

  Access to all primary level personal services and non-personal services provided by the public health service will be free of charge effective 1 April 1996. Medicines included on the Essential Drug List will be available at a low cost at all primary care facilities. Patients, who bypass primary care facilities and go to hospital outpatient departments for primary care, will be charged a R 50 penalty. Patients will still be charged a user fee for public hospital inpatient services. The amount of these charge will be determined at the provincial and district levels.

  3.3 PHC Delivery Model

  The health district will be the building block of the new PHC system. Each health district will be managed by an integrated team, known as the district health authority (DHA). The DHA will be responsible for all primary care and district hospital services, and it will control the district's health budget. The first model district should be introduced in May 1996, but it will take 5 years or more for working districts to be in place throughout the country. The exact structure and authority of health districts is still being discussed within the Department of Health. Once the districts are functioning, communities are expected to play an important role.

  In order to meet the health needs of the population, the public sector health system urgently needs to be improved. The delivery of quality, comprehensive primary care services is constrained by a shortage of suitably trained health personnel. According to the document, more than 10,000 primary health care (PHC) nurses and more than 1,000 doctors are needed nationally to provide quality primary care services. To increase the number of PHC nurses over the long-term, professional nurses will be retrained to provide primary care services. For now, professional nurses with limited clinical training will be moved from hospital to primary care facilities. They will be responsible for delivering primary care services.

  The Department is also attempting to attract more health professionals to the public service and to underserved areas by improving their conditions of service, filling vacant posts, moving posts, and entering into agreements with foreign governments. The Department's first priority is to fill positions with full-time staff members. In the event that this is not possible, the Department accepts the possibility of sessional contracts and referral contracts with private practitioners. Beyond medical staff, there is a serious shortage of qualified health managers. The document proposes intensive management training programmes to build managerial capacity.

  Within a district, health services will be provided by a team of health professionals. Teams should include a mix of medical practitioners, PHC nurses, community health nurses, rehabilitation workers, oral health worker, dentist, pharmacist, nutritionist, optometrist, psychologist, social worker, health promotion specialist, radiographer, laboratory technician, pathologist, and environmental health officer. The specific members of the team in a district will be determined locally depending on health priorities and available resources. Although the Department recognises the important contribution that Community Health Workers (CHWs) can make, it recommends that they not be included in the formal health sector at this time. NGOs and CBOs can continue CHW programmes, which may be contracted for services at a local level by the DHA.

  In the long-term, the district will begin to purchase services from both public and private health care providers, including NGOs and CBOs. This should promote competition between them, providing incentives for public providers to improve their service.

  3.4 Essential Drug Policy

  The high cost and lack of availability of medicines are recognised as two major problems affecting the health system. In response to these problems, the Department has developed an Essential Drug List (EDL). The EDL contains the names of medicines to treat 9 out of ten common and important health problems in South Africa. These medicines will be of high quality, safe, and low cost. They will be available at all primary health care facilities, district hospitals, and private providers. In addition, there will be a set of treatment guidelines that instruct doctors and nurses how to best use the medicines on the EDL.

  3.5 Financing PHC Services

  In order to implement these proposals, it is projected that government funding for PHC services would increase from R 4.7 billion in 1996/97 to R 7.0 billion in 2000/01, increasing 8 percent each year. The Department is planning to limit spending on hospital services, administration, and emergency services to make more money available for primary care services. Additionally, the Department proposes to use international donor and RDP funds to build and upgrade facilities and recover more money when people use public hospitals. Even with these changes, the Department will require more money from the central government's budget. If this additional money is not made available, the Department may consider a dedicated payroll tax to pay for public health care service.

4. Private Sector Reforms

The Department has proposed a series of reforms for the private health sector. The details of these proposals need further consultation and negotiation with relevant stakeholders before they are implemented. Once agreement has been reached, the Department plans to draft framework legislation in the National Parliament. Specific details will be added later through regulations issued by the Department.

According to the plan, all formally employed persons would have to purchase private health insurance for at least inpatient services at public hospitals. The Department estimates that this insurance would cost about R 400 per person per annum, R 34 per month. The amount of money paid by employers and employees would have to be negotiated by those parties. It is envisaged that the amount paid would increase with a person's income, the less money one earned the lower amount they pay.

The Department also proposes changes in the medical aid market. Private medical aid schemes will not be able to exclude individuals because of their health status. People will be able to sign up for medical aid schemes at any time, their contracts must be renewed, and they should be able to switch schemes without penalty. Insurance coverage should continue for a limited time after people retire, lose a spouse, or lose their job. Generally, people will not be charged more for medical aid because they are sick. Employers may be required to offer medical aid coverage to a worker's dependents. The Department also proposes a series of legal changes to make the insurance market more efficient and competitive.

The Minister of Health should be responsible for the construction of new private hospitals and purchase of expensive technology in both the public and private sectors. Pharmacies can be owned by anyone, but all issues related to the dispensing of medicines must be controlled by a registered pharmacist. Dispensing of drugs by doctors will be prohibited in areas where pharmacies are easily accessible. Payment of pharmacists and dispensing doctors should be not be related to the cost of prescription or over-the-counter medicines. They should be paid a professional fee and their dispensing costs.

All health professionals will be required to work in the public sector for two years before they are allowed to enter private practice. Financial and non-financial incentives will be provided in exchange for this mandatory service. The Department plans to limit certification and licensing in areas with too many health professionals to encourage people to practice in underserved areas.

All contributions to medical aid schemes by employers and employees will be taxed with a fixed amount being allowed as tax deductible. The current 5 percent threshold for the tax deductibility of medical costs should be increased. The private sector reform proposals will be debated in consultation with the Katz Commission and NEDLAC in the coming months.

For more information about this document or other health policy issues, please e-mail phila@wn.apc.org. The PHILA Programme is supported by a grant from the Henry J. Kaiser Family Foundation, Menlo Park, California, USA.

Last updated: 14/12/98
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