In the media

Afrocentric group welcomes debate sparked by HMI final report

30 September 2019

JOHANNESBURG, Sept 30, 2019 – AfroCentric Group, South Africa’s largest health administration and medical risk management solutions provider, has welcomed the release of the Competition Commission’s final Health Market Inquiry (HMI) report, its findings and recommendations.  Amongst others, the report outlines some key issues relating to the over-utilisation of health services and facilities.

"We believe the HMI report will stimulate deeper engagement and address key matters on many issues, including the historically  fragmented nature of health coverage", said Dr Lungi Nyathi, Executive Director for Health Management at AfroCentric Group, owners of Medscheme.

The report is a culmination of the process that was started in November 2013 and represents findings and recommendations in relation to the functioning and structure of the private health sector facilities, individual practitioners and funders markets respectively. 

"We believe the recommendations of the report will help us address relationships between various market players in the private health care sector, including contractual relationships between and within different health service providers, escalation of private health care expenditure, and the nature of competition within and between health-care providers.

"We agree that the rising costs continue to affect the affordability of medical scheme cover for millions of South Africans. We also agree that we need to curb over-utilisation of services and address challenges with regards to disempowered and uninformed consumers.

"We also agree that the industry needs to address governance failures and the incomplete regulatory framework governing the medical aid sector.  The recommendation for the establishment of a Supply Side Regulator, to look at the  concentration, licensing and spread of facilities, coding and some of the unregulated suppliers, is a welcome move," said Dr Nyathi.

She said AfroCentric Group and its subsidiaries look forward to participating in the implementation of the HMI recommendations.

Dr Nyathi said that there are aspects and issues that contribute to the increasing costs of healthcare and impact the market forces at play within the health care market that the HMI report touches on. These include:

The impact of the incomplete regulatory environment on balancing the solidarity principles and its impact on the cost of care.  We therefore welcome the recommendation on the implementation of a risk-adjustment mechanism;
The impact of market power in the determination of competitive prices;
The need for review of the regulation of practitioners to enable innovative and integrated models of care, such as value-based reimbursement and multi-disciplinary teams;
Imperfect information regarding quality and health outcomes affects consumers, providers and funders ; and
Impact of Prescribed Minimum Benefits on the cost of care.

The report which was handed to the Competition Commission by Justice Sandile Ngcobo, would be given to Minister Ebrahim Patel, Minister Economic Development who will engage, Dr Zweli Mkhize, Minister of Health to consider policy and legal implications of the recommendations and how best to implement them. It would then be submitted to parliament.

"We look forward to contributing to the work on making the recommendations aimed at making high-quality healthcare accessible and affordable a reality", concluded Dr Nyathi.

 

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