State steps up pressure on private healthcare

Tamar Kahn

Mbeki signs new law to compel all medics to obtain certificates of need With the dust not yet settled on the health department's bid to regulate medicine prices, another messy conflict over state regulation of private healthcare looms large.

A decade-long attempt to provide a unified health system that includes both public and private sector providers took concrete form on Friday, when President Thabo Mbeki signed the long-awaited National Health Bill into law.

The move is set to spark loud protest from doctors and private hospital groups, anxious about clauses in the legislation designed to regulate their services.

The proposed law provides for certificates of need, which will compel doctors and healthcare facilities such as private hospitals to apply for permission to practise in a specific geographic area By this mechanism, government intends to correct the skewed allocation of healthcare resources, with most of SA's hospitals and doctors concentrated in more affluent urban areas.

Section 36 of the act prohibits anyone from operating, buying or modifying a health establishment unless they have obtained a certificate of need from the director-general for health.

They will have two years from the commencement of the act in which to obtain one, or be liable for prosecution. No date has yet been set for its implementation, which will only be possible once the health department has promulgated accompanying regulations.

The department's chief director for legal services, Debbie Pearmain, said draft regulations would soon be published for public comment, but she declined to give a date.

Doctors are worried they may be forced to work in rural settings or townships, which have relatively few health facilities, and private hospitals want assurances that their certificates will be valid for periods long enough to protect their investments.

Jackie Shevel, CEO of Netcare, SA's largest private hospital group, said he was concerned that government, as the provider of public healthcare services, was writing the rules for its competitors in the private sector.

The state health sector runs about 100000 hospital beds, as against the 22000 managed by the private sector. The act's provisions outlining the scope of regulations that may be issued by the health minister are also worrying players in the private healthcare sector, as they may open the way for further state intervention in pricing.

Government's efforts to regulate medicine prices have had a bumpy ride so far, after a legal challenge from NuClicks, Netcare and various pharmacy groups succeeded in suspending part of the regulations until the court makes a final decision.

The act empowers the director-general to publish reference price lists for the services performed by health establishments and health workers, such as general practitioner consultations, although these would not be mandatory. (Source: Business Day, 16 August 2004)