National Hospital Network objects to price regulation

‘Hospitals should not be asked to defend their prices, they should merely have transparent pricing structures so that consumers can make rational decisions,' says Otto Wypkema, CEO of the National Hospital Network.

‘A compulsory cap on doctors' and specialists' fees is no different to requiring lawyers to regulate their fees. Imagine how nice it would be if you could access the top legal brains in the country for the same price as a junior lawyer! And imagine how the legal profession would respond!

Wypkema made his comments in the light of the soon-to-be released National Health Reference Price List (NHRPL) for 2009. This is an annually updated ‘suggested price list' produced by the Department of Health and includes prices for all medical consultations and procedures performed by doctors, specialists and hospitals.

Medical schemes options are distinguished (amongst other factors) by the level at which doctor and specialists are paid. Entry level options provide for 100% of the NHRPL and top options generally provide for payment at 300% of the NHRPL.

The provision of healthcare in South Africa is defined by divisions in quality and affordability. Patients in the public sector have to contend with long queues and shortages of doctors, nurses and medicines. On the other hand, world-class care is available in the private sector, but high costs ensure that it is accessible to only a few.

Healthcare reforms propose that prices charged in the private sector should be regulated and capped. The objective of these measures is to ensure that facilities in the private sector should become more affordable to more South Africans. However, the private sector has raised fears that many medical professions would either leave the profession or the country.

Private hospitals have been asked to justify their costs and margins as a starting point for the implementation for a compulsory fee structure. The Hospital Association of South Africa (HASA) has responded by saying that the increasing regulation of the hospital sector will lead to long term under investment in hospitals and medical infrastructure in the future.

Wypkema says that a transparent pricing structure will go a long way to address the problem.

‘Good doctors should not be bound by price regulations. No one would dream of telling a sought after lawyer what he or she could charge. At the other end of the spectrum cost sensitive patients should be free to take advantage of the services of doctors who are able to charge less.

‘We cannot afford to forget that the backdrop of health reform in South Africa,' he said. ‘This is characterized by a declining number of trained medical professionals per capita of our population, decreasing real levels of investment in healthcare by both the public and private sectors and an increasing burden of disease. The shortage of quality care is forcing even the poorest of families to spend more money on healthcare.

‘In addition, the global demand for increased levels in healthcare due to aging populations is exacerbating the healthcare delivery problems in developing countries. We cannot be blind to these issues when crafting new legislation,' he said.

For more information please contact
Otto Wypkema
Chief Executive Officer
National Hospital Network
Tel: 011 922-1230