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Private health market overcharging consumers with no clear outcomes - report

The findings of the inquiry into private health recommended a new tariff regime and a regulator to set prices in consultation with practitioners, hospitals and funders.

Stethoscope. Picture: Pexels

JOHANNESBURG - The Competition Commission on Monday said the findings of the inquiry into private health would play a crucial role in the formation of the National Health Insurance (NHI).

The inquiry released its report with recommendations that will be tabled to Parliament for implementation.

The report said the private health market was failing consumers by overcharging them with no clear outcomes.

It recommends a new tariff regime and a regulator to set prices in consultation with practitioners, hospitals and funders.

The commission's Thembinkosi Bonakele said: “We have a caution, for example, that excluding competition from NHI is a mistake because we know that NHI is going to be a very big buyer for services and goods from the private sector. And of course, as a big buyer, it is possible that it is able to fend for itself and drive down prices.”

The commission has called for a new regulator to be established to keep health funders, facilities and practitioners in check.

The commission’s inquiry has found that health practitioners had been sending patients to private hospitals unnecessarily, just because medical schemes would pay.

It also found that various role-players had been colluding to rob consumers.

Professor Sharon Fonn said: “Our Caesarean sections in South Africa are through the roof. It’s 300% higher. Of course, the individual pays for it, but it pushes up the package of care so all pay more.”

The inquiry has recommended that a supply-side health regulator be established to manage a multilateral price negotiating forum and set prices that no medical scheme or service provider will go above for prescribed minimum benefits.

Dr Ntuthuko Bhengu said they would address pricing in the medical sector.

“Our approach is that there will be three levels for pricing. The first level is the unilateral negotiation forum which caters for practitioners. The second level is the bilateral negotiation while the third will be focused on provider networks.”

The inquiry has recommended that prices be reviewed every three years.

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