Challenges and Solutions : Private Healthcare Industry Squaring the Circle Panel Discussion: HPCSA PERSPECTIVE BY ADV. BOYCE MKHIZE CEO AND REGISTRAR : HPCSA 25 JULY 2007 SUN CITY The BHF Southern African Conference 22-25 July’07 Sun City

Challenges and Solutions : Private Healthcare Industry Squaring the Circle Key Question? Should we be talking Private healthcare Industry Solutions to the utter neglect of the totality of the Healthcare Industry? The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City The Scary Picture! Squaring the Circle Everyone feels squeezed - practitioner not compensated adequately - schemes feel drained and overdrawn - patients feel over-charged and unable to meet costs The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City The Scary Picture! Squaring the Circle - hospitals feel practitioners are out to squeeze them - public sector feels like a dumping ground, overloaded and under- capacitated - Govt battling with cost containment strategies - Pharmaceuticals with medicine price Everybody is unhappy! The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City The Scary Picture! Squaring the Circle Private healthcare expenditure increase at rate double that of inflation, as far back as 1996,1998 1998 : increase from R24.7b to R33.3b The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City The Scary Picture! Squaring the Circle Stagnation in numbers of access to private health insurance : multiple factors - failure to match contributions to expenditure - erosion of reserves - reinsurance premiums etc The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City The Scary Picture! Squaring the Circle Problem is bigger than healthcare providers and hospitals (private) Commercial considerations vs ethical behaviour Complicated and intricate web of power play between multiple healthcare players : hospital, practitioner, funder, patient and regulators The BHF Southern African Conference 22-25 July’07 Sun City

Healthcare Providers & Hospitals Squaring the Circle Commerce vs Medicine - hospitals bottom line driven and thus motivated to create schemes that would open gateway to hospital beds optimum occupancy despising the means - healthcare providers enjoy benefits in exchange for meeting targets at the expense of patients The BHF Southern African Conference 22-25 July’07 Sun City

Healthcare Providers & Hospitals Squaring the Circle Commerce vs Medicine - Inducement and influence to act contrary to ethical codes quite strong especially because of a win- win situation : hospital gets its profit while practitioner enjoys the incentive! - Reimbursement model : fee for service [ source of inducement] The BHF Southern African Conference 22-25 July’07 Sun City

Healthcare Providers & Hospitals Squaring the Circle Capacity and Skills - Powerful and untouchable few! - Take it or leave it attitude - Law of Economics : Demand & Supply [Scarcity of resources – determines the rules of play] - Peer review mechanism erosion [quality concerns] The BHF Southern African Conference 22-25 July’07 Sun City

Healthcare Providers & Hospitals Squaring the Circle Reimbursement Methods - Fee for Service - Capitation - Managed health care - Co-payments - Insurance : Restrictions vs PMBs Reality : someone is unhappy irrespective of which method! The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City Billing Practices Squaring the Circle Ethical Tariff vs NHRPL - Ethical tariff provides a guide for determination whether there has been overcharging [it’s not the target] - NHRPL : benchmark for reimbursement by schemes - Above rate payable by schemes obtain patient consent The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City The Ethics Discourse Squaring the Circle ‘The desire for money is a powerful motivator and our special brand of capitalism has relied on this incentive to make our country one of the most prosperous in the world. Most doctors eschew any commercial arrangements that might compromise their professional values, yet some have not resisted the buzz of the marketplace that values a profitable bottomline & promises….. The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City The Ethics Discourse Squaring the Circle ‘enormous personal wealth. Today, the income of many practitioners is several hundred thousand dollars or more and for some joining the ranks of academic medicine can be a ticket to great wealth and privilege. Given the expertise of our practitioners and researchers in diagnosing and curing us and in finding new and better tests and treatments….. ….. The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City The Ethics Discourse Squaring the Circle ……,few of us would begrudge them such wealth as long as we are confident that they are always using their talents and diagnostic tools in our best interest. But are they? …The time has come to ask whether all of the money floating around in medicine has created a pattern of corruption. The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City The Ethics Discourse Squaring the Circle ..’to be a good doctor requires a life-long commitment to good professional and ethical practices and an overriding dedication to the good of one’s fellow humans and society. In essence the practice of medicine is a moral enterprise.’ Pellegrino ED, Medical Professionalism: Can it, should it survive? J AM Board Fam Pract 2000: 147-149 The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City The Ethics Discourse Squaring the Circle Patients must be able to trust that their doctors’ motives are not subverted by financial gain, that their doctors are recommending treatments that benefit them, that their doctors are involving them in research projects for the right reasons….’ The BHF Southern African Conference 22-25 July’07 Sun City

The Challenged Solutions? Squaring the Circle The future - problem of disintegrating the healthcare cycle - problem of different bargaining positions and strength - Disjuncture between Non- regulation and regulated The BHF Southern African Conference 22-25 July’07 Sun City

The Challenged Solutions? Squaring the Circle The future - Stringent regulatory regimes cutting across the value chain [harmonisation] - Rigorous practice protocols - Accountability mechanisms and structures The BHF Southern African Conference 22-25 July’07 Sun City

The Challenged Solutions? Squaring the Circle The future - Review of reimbursement models - Openness and transparency - Cost-cutting measures The BHF Southern African Conference 22-25 July’07 Sun City

The Challenged Solutions? Squaring the Circle The future - State intervention in the provision of healthcare : access, affordability etc - Private Public Partnerships The BHF Southern African Conference 22-25 July’07 Sun City

The Challenged Solutions? Squaring the Circle The future - Review of training modalities: possibly two streams, generalists and mini- specialised (Cuban) - fast-track supplementary professions The BHF Southern African Conference 22-25 July’07 Sun City

The Challenged Solutions? Squaring the Circle Clubbing together of Medical Schemes : Practitioners’ Bargaining Power: patients bargaining power???????? The BHF Southern African Conference 22-25 July’07 Sun City

The BHF Southern African Conference 22-25 July’07 Sun City Squaring the Circle Thank You The BHF Southern African Conference 22-25 July’07 Sun City