LIMS Reforms and Equitable Subsidies 20 January 2010 National Health Insurance Policy Brief 17

PMBs, BBPs and LIMS PMBs Source: IMSA NHI Policy Brief 17: LIMS and Equitable Subsidies BBPs = PMBs + additional primary care LIMS PMBs = PMBs for maternity in hospital; PMBs for chronic medicine; PMBs for related visits and tests; and primary care including specialists, as delivered in a capitated setting.

LIMS and Medical Schemes LIMS already on medical schemes – will they migrate to LIMS options /schemes? Would leave only 10.3% of population on medical schemes with 19.7% on LIMS schemes if cover mandatory from LIMS threshold of R2,000 pm Source: IMSA NHI Policy Brief 17: LIMS and Equitable Subsidies

Population for LIMS LIMS has much younger tail so leaves medical schemes with very old profile. LIMS profile will age fast over time as people on LIMS schemes reach retirement age. Source: IMSA NHI Policy Brief 17: LIMS and Equitable Subsidies

Access to Essential Healthcare Proposed … Source: PMB review consultation document. Third draft 25 March 2009

LIMS Reform without REF LIMS helps workers close to tax threshold but worse than staying in PMBs for two lowest income groups. Source: McLeod &Grobler for ASSA Convention 2009 Source: IMSA NHI Policy Brief 17: LIMS and Equitable Subsidies

Risk-adjusted transfers for PMBs National Health Solidarity Fund Private Health Insurance Funds Employer Direct contributions for packages above PMBs Government Direct subsidy per person (total population) Income-based contribution for PMBs less direct subsidy National Health Service Risk-adjusted transfers to Provinces Risk Equalisation Fund Provincial Risk-Adjustment Formula Per capita or risk- adjusted transfers of direct subsidy Public Tax Employee Source: IMSA NHI Policy Brief 16: Universal Coverage and Equitable Subsidies

Risk-adjusted transfers for minimum package Government Direct subsidy per person for total population at level needed for well-functioning NHS Income-based contribution for minimum benefits less direct subsidy National Health Service Risk-adjusted transfers Risk Equalisation Fund Provincial Risk-Adjustment Formula Per capita or risk- adjusted transfers Tax Risk-adjusted or per capita transfers of direct subsidy LIMS Health Insurance Bargaining Council Funds Private Health Insurance Funds Solidarity Fund for Bargaining Council Funds Risk Equalisation Fund LIMS National Health Solidarity Fund Direct contributions for packages above minimum Employer Employee Source: IMSA NHI Policy Brief 17: LIMS and Equitable Subsidies

Innovative Medicines South Africa (IMSA) is a pharmaceutical industry association promoting the value of medicine innovation in healthcare. IMSA and its member companies are working towards the development of a National Health Insurance system with universal coverage and sustainable access to innovative research-based healthcare. Contact details: Val Beaumont (Executive Director) Tel: Fax: Innovative Medicines SA (IMSA) Cell: PO Box 2008, Houghton, South Africa

Material produced for IMSA by Heather McLeod