It will cost government an additional R296-billion to implement the highly contested National Health Insurance Bill (NHI).
This is contained in Solidarity Research Institute’s (SRI) latest report that seeks to highlight financial hurdles and answer feasibility questions.
Since it was introduced in parliament, the bill has been met with scrutiny, with questions raised whether government will be able to fund the project.
The bill also caused an uproar among those with medical scheme covers, as they wondered how it will affect their policies.
Solidarity strongly asserts that the NHI Bill is financially untenable and should be reconsidered, arguing that its implementation will result in increased costs for citizens and potentially lead to a decline in healthcare services.
According to Theuns du Buisson, economic researcher at SRI, one of key concerns highlighted in the report is a lack of transparency.
He said indications from government suggest that funding will come from the income tax surcharge and a payroll tax.
However, according to Du Buisson, this approach will excessively impact individuals with lower incomes.
“For most salary earners, this means an increase of approximately 40% on your personal tax burden,” he said.
“If you are currently paying R5 000 towards income tax, you will pay R7 000 in the future.
“Minimum wage employees will be hit the hardest because they are currently not paying any tax, but will now be taxed at a rate of approximately 14%.
“At present, these workers already qualify for free healthcare in state hospitals. This gives us an indication of how absurd the NHI plans are.”
He stressed that while there is an acknowledgment of a need for healthcare reform, the shortage of healthcare professionals and the quality of services in the public sector should be a priority.
“Indeed, there is a need for reform in the country’s healthcare sector, however, the focus must first be on training more doctors, and second on improved quality of services.
“Only then can the state begin to have input in the private medical sector.”
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