Sunday Times (Johannesburg) - September 11, 2005
Adele Shevel and Claire Keeton

"As for providing affordable healthcare to employees, rising healthcare costs mean many individuals are buying down into cheaper options, deregistering some of their dependants or discontinuing their cover"

THE healthcare industry - both public and private - is being hammered by high costs, staff shortages and a seemingly uncontrollable rise in the number of HIV/Aids patients.

The results of three surveys this week reveal a crisis in the health- and disease-control system.

The 2005 Health Systems Trust Review, researched in partnership with the Department of Health, shows that:

*The public sector has 46000 fewer healthcare professionals than it needs.

*With cuts in posts and professionals leaving in droves - the number employed in the public sector has dropped from 197898 in 2002 to 123268.

The report warned that the public health system will need an extra 3200 doctors to reach its HIV/Aids treatment targets by 2009.

In a separate report on the Millennium Development Goals, the government indicated it was "well on course to meet all targets".

But examining the results listed under the health goals, it is clear South Africa still has a long way to go to achieve them.

Infant mortality rates have not improved since the development goals were made public, for instance. And despite increased spending on HIV/Aids, its prevalence among pregnant women has increased.

In a separate report, this time on trends in the private healthcare sector, employers rate costs as the most significant issue they face.

This was determined in Old Mutual's healthcare survey, undertaken every two years and released this week.

An industry benchmark, it includes interviews with about 1.5 million medical scheme members and their employers in the private, parastatal and public sectors.

Lydia Footman, Old Mutual Healthcare Risk Manager, says concerns about high costs are based mainly on the effect of HIV/Aids, but include worries about fraud and over-servicing.

There has been a dramatic shift in the way in which employers have risen to the challenge of dealing with the HIV/Aids pandemic, says Footman.

"We have observed how employers have moved from having no measures in place, to introducing HIV/Aids management programmes, to implementing regular HIV/Aids prevalence testing and monitoring in the workplace."

Far more employers have a documented healthcare strategy than previously. It found that 69% of employers have this in place, a big jump from 20% of employers in 2001 and 2003.

Paul la Cock, actuary and executive at Old Mutual Healthcare, says employers have transformed their approach to dealing with HIV-positive employees.

He says HIV/Aids strategy and policy development is the key focus for nearly 80% of employers. This contrasts with the years prior to 2000, where the focus was largely on education and awareness.

Only 12 of the companies were able to provide the results of recent workplace HIV prevalence studies.

But among these companies, employing a total of about 300000 people, nearly 20% of the workforce tested positive for HIV/Aids.

For the first time the survey shows that member education - at number four - is rated among the top strategic issues for employers.

As for providing affordable healthcare to employees, Footman says rising healthcare costs mean many individuals are buying down into cheaper options, deregistering some of their dependants or discontinuing their cover.

"Many employees simply cannot afford to fund the rest of the contribution from their own pockets."

Pensioner pre-funding as a crucial strategic issue dropped from third to sixth place in 2003, and remains there.

Employers no longer rate this as a critical issue largely because 42% of employers surveyed do not fund pensioners.

The survey also finds that all employers want to be consulted on the implementation of social health insurance, though many do not understand its effect on the healthcare industry. The social health insurance is an initiative to provide affordable cover to the lower income groups.

Thabiso Buku, managing director of Old Mutual, says employers are more positive about the sustainability of medical schemes than they were in 2003.

More people in the industry think it is over-regulated than previously.

This is attributed to the fact that: *the regulation of medicine pricing and impact on pharmacists remains unresolved;

*because of the licensing of dispensing doctors and the impact on people in the rural areas;

*and the cost of the implementation of the extended prescribed minimum benefits.
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