Medical insurance a viable alternative

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Approximately 3% of South Africa's population have not made adequate provision for this essential expense, with the misconception that medical cover is either unaffordable or inaccessible.

The long-awaited National Health Insurance (NHI) policy document was approved by Cabinet on in August 2011. The NHI will ensure universal healthcare access to all legal residents of South Africa regardless of how much they earn. But promises made by Minister of Health, Aaron Motsoaledi and Finance Minister Pravin Gordhan have not come to fruition.

Shortcomings at hospitals

Government hospitals need to be radically improved, infrastructure developed, human resources systems put in place and an information technology system developed before it can become a reality. The health budget for 2012/2013 paid from the South Africa's National Treasury was R121bn, while the total health spend in the country was R248.6bn, representing 8.3% of our GDP, which includes contributions by private individuals to medical aid schemes. The World Health Organisation recommends it should be no more than 5%.

Compared to the rest of the world, South Africa has a long road to travel. In March 2010, President Barack Obama officially signed the Patient Protection and Affordable Care Act (PPACA) into law. Nearly four years later, over 100 million Americans are already benefiting from this new health care law. In China, healthcare spending has risen from 1% of GDP in 2002 to more than 5% in 2014, with 95% of the population now having some form of health insurance.
Unfortunate situation

Although the statistics look bleak, it is gratifying to know that for a mere R156.00 per month (R5.20 per day), an individual can be covered for hospitalisation in the event of an accident, disability and death cover. Essential Med is a unique and much needed medical insurance for the majority in the country. Established in 2005, Essential Med is one of the larger players within the health insurance industry at present and is speaking to clients that are looking for a viable and affordable alternative. "Affordable medical care, like food, is a part of our daily lives and must be utilised by all citizens within the country at some stage," says Mike Smit, CEO of Essential Med.

"The unfortunate situation that South Africa finds itself in is the affordability of health services without many viable alternatives available. NHI is at this stage a dream, which would, if it could be implemented as documented, be a great and efficient alternative for persons who cannot afford private healthcare. This, however, with the capacity constraints and realities within South Africa is going to place the NHI system, as an alternative platform, out of reach for majority of South Africans for many years to come," Smit says.