17 May 2017

South Africa: Minister Eyes R20 Billion in Med Scheme Tax Credits for NHI Fund

Cape Town — Health Minister, Dr Aaron Motsoaledi, says the tax credits that are being earmarked for the establishment of the National Health Insurance (NHI) Fund amount to R20 billion.

The Minister said this when he tabled the Department of Health's Budget Vote in the Old Assembly Chamber in Parliament on Tuesday.

This comes after former Finance Minister Pravin Gordhan announced in his February Budget Speech that government was looking at setting up a NHI Fund and that in setting up the proposed fund, a number of options would be explored, including possible adjustments to the tax credit on medical scheme contributions.

"... The tax credits mentioned in the February 2017 Budget Speech by Treasury is a whooping R20 billion. Yes, R20 billion that in 2015 and annually will leave the fiscus through the SA Revenue Service [and] back to the pockets of people simply because they are members of a medical aid scheme (sic)," the Minister said on Tuesday.

Addressing Members of Parliament, the Minister said returning these tax credits back to medical aid schemes, instead of using it for universal health coverage, did not make sense.

The Minister said the time has come to use the fund to level the playing fields and provide services that would benefit the less privileged.

"This is the worst form of social injustice committed in the name of the cream of the South African society with our full participation... We believe the time to change and move towards economic equity as O.R Tambo had declared, has now arrived.

"We are proposing that the first step towards implementation of NHI is to pick up those who are outside the system of medical aids and provide services for them through the NHI Fund, which must be created from, among others, the R20 billion tax credits," he said.

What the NHI can be used for

Minister Motsoaledi said, meanwhile, that in a massive reorganisation of school health during the first phase of the NHI pilot, the department has completed the screening of 3.2 million school kids for physical barriers to learning, including eyesight, hearing, speech and oral health.

He said a total of 500 004 school kids were found to have several problems. This includes 8 891 children with speech problems that will need a speech therapist; 34 094 children with hearing problems that will need an audiologist or maybe hearing aids; 119 340 with eyesight problems that will need an optometrist, ophthalmologist or maybe spectacles, and 337 679 children with oral health problems that may need a dentist, dental therapist or oral hygienists.

Minister Motsoaledi said the NHI Fund will, once established, be used to help the 500 000 children that have been screened.

"We will provide free antenatal care in the form of eight visits to a doctor to each of the 1.2 million women who fall pregnant annually. We would also provide them with family planning, provide for breast and cervical cancer screening as well as treatment where appropriate," he said.

The Minister said through the fund, the department would also be able to provide better services for mental health users including screening and subsequent services.

The elderly would also benefit by being given assistive devices like spectacles, hearing aids and wheelchairs. The department would also be able to provide assistive devices to people living with disabilities.

"We will also deal with the backlog of blindness caused by cataracts. The backlog is now 270 000 elderly people who are presently blind and are awaiting cataract removal.

"We can perform 90 000 operations a year for the next three years to clear the backlog. This to us will be the beginning of revolutionising the way healthcare is provided in our country," Minister Motsoaledi said.

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