11 January 2008
The Department of Health held a meeting in Pretoria today with the CEOs of the Private Hospital Groups to discuss concerns around the excessive increases in private hospital tariffs for 2008 - well above the general inflation rate.
The meeting was attended by MECs for Health, policymakers and at least 22 representatives of various private hospital groups.
The purpose of the meeting was to give the private hospital sector an opportunity to explain why the increases were necessary and to the extent possible to explain how they arrived at the increases. We were concerned that these increases came soon after the Indaba I had with the private sector in September last year in which the industry raised several concerns, including issues of affordability, access and sustainability.
The groups indicated that contractual agreements had already been signed with individual schemes and that the tariff increases had been implemented with effect from 1st January 2008. They also reported that on average the rate of increase was around 9% - which is above the consumer price index (CPIX).
When challenged by the government to consider the issue of affordability by members of medical schemes, representatives of the hospital groups committed themselves to reconsidering the tariff increases and at best increase tariffs to the current CPIX level pending further discussion between the Department and individual hospital groups.
These individual meetings are necessary because issues of confidentiality and in order to comply with the Competition Commission ruling on price setting. We committed to having these meetings with individual hospital groups within the next two weeks and asked that in their presentations to the Department, be transparent so that we fully understand their justification of the increases.
The private hospital sector was also directed by the Department to ensure that they comply with the law with regard to charging for anaesthetic gasses by the minute instead of per millilitre. In the event that any group transgresses the law we will have no alternative but to prosecute.
The Hospital Association of South Africa (HASA) has been working on presenting a comprehensive report arising from issues raised during the last indaba held with the private sector. We have requested a copy of the report and will engage with it at a meeting with HASA that will take place within the next few weeks.
In order to understand all sides of the issue we shall also be speaking with the medical aid schemes, notably the Board of Healthcare Funders. Government will engage with all parties to seek a solution to the increasing cost of private health care in South Africa. The private health sector plays an important and complementary role to the public health sector within the national health system. We therefore need to ensure that it is sustainable in the long term.
I thank you.
Dr Manto Tshabalala-Msimang
Minister Of Health
For more information contact Charity Bhengu 083 679 7424