During the apartheid years, “whites” used to mostly go to private general practitioners in a fee-for-service arrangement, before being referred, if necessary, to specialists or for admission to “whites-only” public hospitals which were funded and managed by the provincial health departments. “Blacks” were expected to do the same, except that they were referred to “black” hospitals, preferably in the homelands and mostly to the mission- or army-hospitals.

However, in light of public health concerns, the apartheid government tasked local government to set up clinics in every municipality to only provide preventive services: immunisations, family planning, treatment for tuberculosis, etc, for free to the full population. No personal primary health care (PHC) services were offered.

There was one medical school (Natal Medical School), with about 100 places per year for “black” doctors to study, resulting in many bright young “black” students having to choose nursing as a career path – along with the likes of teaching and policing.

This PHC deficit was addressed marginally during the 1980s when the apartheid state was being reformed, with some PHC clinics being built and controlled by provinces, especially in “Indian”, “coloured” and some hotspot “African” townships such as Soweto. Progressive doctors in places like Baragwanath Hospital had already started training nurses as clinicians in the 1970s to address the lack of doctors in PHC.

With the release of Nelson Mandela and the unbanning of the ANC, it was obvious in the early 1990s that publicly controlled resources of specialists and hospitals were no longer going to be available for the predominant use of the white population. There were moves, just before 1994, to liberalise the medical scheme environment with open schemes.

The government elected in 1994 prioritised PHC by encouraging municipalities to provide the full range of PHC services in their clinics, mostly hiring nurse clinicians. Provinces tried rationalising public hospitals, with some small ones that were inappropriately positioned converted into community health centres.

In addition, the Reconstruction and Development Programme in 1994 included a provincially managed clinic upgrading and building programme to improve access to PHC.

One can say that substantial universal health coverage was achieved over those first few years of the new South Africa, with the entire population having free access to PHC services. However, the service range was limited by the training of nurses and, increasingly, standards not satisfactory to the majority of people.

A white paper on transformation of health services laid out the thinking of government in 1997, including the development of a national health service that included private sector providers. Considering the growing private sector and an easily compared experience of personal health care by private providers, unions (especially in the civil service) increasingly saw medical scheme membership as a perk of post-apartheid South Africa – partly contributing to ballooning private health expenditure.

All this and more is described in Health and Health Care under Apartheid, The private health care sector, South Africa’s Return to Primary Care: The Struggles and Strides of the Primary Health Care System and in Public Healthcare In A Post-Apartheid South Africa: A Critical Analysis In Governance Practices.

After the Constitution of 1997 set up new national and provincial government structures for South Africa, the National Health Act of 2003 (NHA 2003) formally set up the new health system. This united various apartheid health systems into one national and nine provincial departments of health, with councils and consultative structures at both these levels. The Constitution of 1997 delegated health to local government, but this was reconsidered by 2003 as there were serious capacity challenges at local government level across the country. Laws formally setting up local and district/metropolitan municipalities were only enacted in 2001 and it was felt that adding the substantial burden of PHC services, including district hospitals, to this new layer of government would be challenging.

The NHA 2003 created the district health system in chapter 5, with districts and sub-districts following municipal demarcations. District health councils (DHCs) were created in the NHA 2003 as a governance structure, with appointments by both local government and members of executive committees (MECs) of provinces.

A DHC consists of a member of the district or metropolitan municipal council, a person appointed by the provincial MEC, a member of each local municipality within the health district and not more than five other persons, appointed by the MEC after consultation with the municipalities. The chair of the DHC is from the district municipality.

The function of the DHC is to promote cooperative governance, ensure coordination and advise the MEC. However, the functioning of DHCs, including the approval of health budgets and performance targets, requires provincial regulation, which is not in place in provinces and render most DHCs of little consequence.

Actual operational control of health districts is vested in the MECs of provinces.

District managers are appointed by provinces with some devolution of operational control to district and sub-district level, depending on local capabilities and political balances. It is up to the MEC to ensure that health districts and sub-districts are effectively managed. Money flows from National Treasury straight to provinces, who allocate funds to their provincial departments of health as they see fit. This is in the form of line-item budgets down to facility level.

However, procurement and human resource management of facilities is often closely managed by provincial officials. Sub-district and facility managers are often constrained by the district-provincial bureaucracy.

While NHA 2003 allows municipalities to provide health services, this is supposed to be under a service-level agreement with the province. Provinces pursued a “provincialisation” strategy, transferring many local government facilities and staff to provincial control.

Most municipalities transferred control. However, politically strong metropolitan municipalities resisted this and continue to provide PHC services, citing better management capabilities in local government-run facilities than provincial government-run health facilities. Provincialisation has been in abeyance since the idea of National Health Insurance was introduced in 2008.

The National Health Insurance (NHI) Bill supposedly changes the public service, mostly by creating a purchaser-provider split. Hence the development of an NHI Fund as a body separate from the Department of Health.

Strategic purchasing by the NHI Fund, i.e. actively purchasing health care services from accredited and contracted providers on behalf of the population, is supposed to provide for equity, efficiency and quality of services, through competition and consequence management. Funds for PHC services are expected to flow from National Treasury to the NHI Fund, which then contracts with public and private providers.

The NHI Bill amends NHA 2003 in clause 31 by creating a new structure under the DHC – namely the District Health Management Office (DHMO) (31A), as a component of the national Department of Health. The objective is to facilitate and coordinate the provision of personal and non-personal PHC services at a district level.

The DHMO is expected to manage provision of non-personal health services in the district; improve access; facilitate certification and accreditation of providers; control quality of service; ensure a functional referral system between levels of care and public and private providers; facilitate integration of emergency medical services (excluding ambulances); provide information on disease profile; develop and procure health technology; liaise with the NHI Fund on needs and challenges; and cooperate with NHI investigation units; interact with DHCs; liaise with provincial and municipal health authorities; and prepare and submit annual strategic health and human resource plans for the health district to the national Department of Health. The director-general of the national department must now, together with DHMOs, ensure the health district is effectively and efficiently managed.

The NHI Bill amends NHA 2003 in clause 21 by changing the national Department of Health’s function of coordination of services “by” provinces to the co-ordination of services “through” provinces and the newly created DHMOs.

The NHI Bill amends NHA 2003 in clause 21 by adding a number of functions to the national department that are currently managed by provinces: promoting adherence to norms and standards for human resources training; planning the development of public and private hospitals; and developing and managing a national health information system.

Other new functions added to the Department of Health include controlling and managing the cost and financing of public health; developing a national policy for procurement and health technology; developing guidelines for the management of health districts; and, together with the DHMO, promoting community participation in a health district.

Provision of port health services and facilitating research on health services are also removed from provinces – and apparently placed under the central government. The amendment to clause 21 also moves the following functions from provinces down to DHMOs: provision of comprehensive primary health care services and community hospital services; promoting health and healthy lifestyles; and preparing and submitting strategic, medium-term and human resource plans annually.

Provinces are expected to assist DHMOs to control of the quality of all health services and facilities in an amendment to clause 25, rather than provinces controlling it.

The NHI Bill amends NHA 2003 in clause 27 such that provincial councils will no longer be advising MECs on policy regarding responsibilities for health; targets, priorities, norms and standards within the province; development, procurement or use of health technology within the province; the design and implementation of referrals or integration of public and private health establishments; financial assistance received; norms and standards for health establishments; and guidelines for the management of health districts.

The NHI Bill amends NHA 2003 in clause 31 relating to the district health council (DHC) in that the MEC will consult with municipalities and DHMOs in making additional appointments to the DHC. It also adds the promotion of community participation to the function of the DHC. This is in addition to the DHC currently ensuring coordination of planning, budgeting, provisioning and monitoring of all health services in the health district.

The NHI Bill amends NHA 2003 in clause 31 by creating a new structure under the DHC and DHMO, a contracting unit for PHC (CUP) (31B). The DHMO is expected to establish CUPs within a framework stipulated by the NDOH. CUPs will manage the provision of PHC services. CUPs must be comprised of a horizontally integrated network of district hospital, clinics or community health centres and selectively contracted private providers. CUPs will be the preferred organisational unit with which the NHI Fund will directly contract.

The NHI Fund will transfer funds directly to the CUP to ensure the provision of PHC services, including prevention, promotion, curative, rehabilitative ambulatory, home-based and community care in the geographical area of a subdistrict (ranging from Soweto (with about two million people) to rural districts (150,000 people).

The amount of funds received by CUPs will be guided by district health resource allocations or capitation formulae. Each CUP will be responsible for the population in its designated sub-district. These 180+ CUPs across South Africa will be expected to identify certified and accredited public and private providers in their sub-district to contract with and then fund them to provide PHC services.

DHMOs will perform CUP functions until CUPs are adequately capacitated. It appears the CUP will be a proxy for the NHI Fund. Further regulations are expected to spell out the functions and powers of the DHMO and CUP, the relationship between public and private providers, and the optional contracting in of private providers.

The NHI Bill amends the NHA 2003 in clause 41 by removing clauses around fee setting and fee retention by public health establishments, as these are now shared between the NHI Fund and providers.

The NHI Bill creates an Office of Health Products Procurement within the NHI Fund that is responsible for the centralised facilitation and coordination of functions related to procurement of health-related products, including medicines and equipment. It is expected to determine and develop a national list of products; coordinate the supply chain process and price negotiations; facilitate cost-effective, equitable and appropriate public procurement; support the process of ordering and distribution of products nationally, and at district level with DHMOs; support DHMOs in concluding and managing contracts with suppliers and vendors; manage risk in public procurement; and facilitate the procurement of high-cost equipment. An accredited provider is expected to procure according to a formulary, and suppliers listed in the formulary must deliver directly to the accredited and contracted provider.

The NHI Bill sets out the accreditation of service providers in clause 39. A provider must be in possession of certification from the Office of Health Standards Compliance, and meet the needs of users, including a minimum range of service; appropriate number and mix of healthcare professionals; adherence to guidelines and referral pathways; submission of information to the national health information system; and adherence to national pricing.

Once accredited, the NHI Fund will sign a legally binding contract with the PHC service provider, through the CUP. There will be a clear statement of performance expectation and provision of details of care via the Health Patient Registry System. The NHI Fund will renew provider accreditation every five years and may withdraw or refuse renewal of accreditation.

Chapter 9 of the NHI Bill lays out a complaints and appeals mechanism for both users and providers. The NHI Bill speaks of the need for a number of regulations in clause 55, including payment mechanisms; registration of users; accreditation etc.

The NHI Bill sets out population coverage in clause 4, with the NHI buying services for all South African citizens, permanent residents, refugees and correctional service inmates. Asylum seekers and illegal foreigners are only entitled to emergency medical services and notifiable conditions of public health concern.

In clause 5 of the NHI Bill it states that a member of the eligible population must register as a user of the NHI Fund at an accredited provider. The user is expected to produce an identity card, original birth certificate or refugee identity card and then provide biometrics (and possibly fingerprints, photographs and proof of residence), to be registered.

The NHI Bill sets out the rights of users in clause 6, including the right to receive quality care; information; access to records; access to care in a reasonable time period; to submit a complaint etc. The medically necessary and cost-effective benefits package will be determined by the NHI Benefits Advisory Committee (as per clause 7) and priced by the NHI Health Care Benefits Pricing Committee.

It is expected that services for occupational injuries and diseases, road accidents, correctional service patients and substance abuse will be paid for via the NHI Fund.

Anyone seeking health services from an accredited provider must provide proof of registration with the NHI Fund to that provider. Users are expected to access healthcare services at a PHC level and must adhere to referral pathways.

Access to NHI services will be free. However, a user must pay (either cash or with complementary medical insurance) if the NHI Fund does not cover a service or treatment or the patient seeks to bypass the referral pathway.

There will be some prescribed “portability” of health services. Should a user be unable to access services with the provider they are registered with they will be “transferred” to another provider.

The transition to NHI is in two phases. Phase 1 (2017-2022) is expected to continue with health system strengthening; NHI legislation; building NHI institutions (including structuring of CUPs in a cooperative arrangement with the district hospital linked to PHC facilities); accreditation of providers; purchasing of personal PHC services from contracted public providers and from private providers (selectively) for vulnerable groups such as rural communities, children, women, people with disabilities and the elderly. It will also include purchase of hospital services and other clinical support services. Phase 2 (2022-2026) is an expansion of this.

Hopefully, this overview of NHI for PHC will assist constructive engagement with issues. DM

Professor Shabir Moosa is a family physician working in the public health service in Soweto and a professor at the Department of Family Medicine and Primary Care, University of Witwatersrand. He is also president of the African region of the World Organisation of Family Doctors.