It took the National Health Insurance (NHI) project eight years from achieving green paper status in 2011 to becoming a bill presented to Parliament in 2019. Any project whose implementation affects all three spheres of government, and the private sector must be regarded as massive in scale. Add to this the wide-ranging scope covering a spectrum stretching from public health research to the payment for health services and you have a complex project that requires skilful navigation. 

Operational obstacles

While it might be difficult to predict and prepare for possible legal challenges ahead, the same can’t be said about possible operational obstacles. Knowing the current status of the health system, operational challenges are fairly easy to predict which makes it possible to develop plans for mitigation. Not doing so will be a dereliction of duty and it would significantly increase the risk of project failure.  

Also, concluding that implementation failure risks are much higher at district than at national operational level, would be entirely justified when considering variability in constraints experienced. It would therefore make sense to skew any mitigation interventions in favour of districts in order to ensure a sufficient level of readiness in anticipation of the NHI roll-out.  

Moreover, tailored mitigation interventions should go beyond differentiating only between national and district operational levels. It should also account for urban-rural capacity inequalities. It doesn’t take much skill to predict that implementation failures have a higher likelihood of occurring in rural districts than in their urban counterparts. With a large number of people in South Africa accessing health services in rural areas, failure in these geographics will constitute a major setback for the NHI. 

Drastic changes

Not only is the importance of the district operational level founded on its primacy in the healthcare service delivery value chain, but also on the drastic changes envisaged by the NHI at this level.  

The NHI Bill, in section 37 provides for the establishment of a Contracting Unit for Primary Care (CUP) which will be responsible for managing the provision of primary healthcare services within a sub-district area. The CUP will comprise a district hospital, clinics or community health centres and ward-based outreach teams and private providers. Furthermore, the CUP will also be the preferred organisational unit with which the NHI Fund will contract to purchase health services. 

This represents a major shift in the funding of healthcare services currently funded by the provinces to the NHI Fund. 

The shift in funding also implies a shift in function. From a district point of view, the NHI functions will be executed through the CUPs. These functions are listed in section 37 (2) of the Bill. 

It is expected that CUPs will not be able to fully execute their mandates from day one. For this reason, the Bill provides for transitional arrangements in terms of which a CUP is allowed to work in a “cooperative management arrangement” with a district hospital. This effectively means that district hospitals will be required to assist the fledging CUPs until the latter is fully capacitated. This assumes that district hospitals themselves are in a position to provide this support, a scenario which is highly unlikely. For this reason, it would make sense to direct the bulk of the readiness efforts at district hospitals. 

Assessments of the readiness of a district hospital to provide the needed support must be based on an understanding of the nature and scope of the functions assigned to a CUP.  Besides the function related to the “integration of public and private healthacare services within the sub-district”, all CUP functional areas are covered by the role and functions assigned to district hospitals as contained in the National Norms and Standards for District Hospitals (NNSDH). This, however, does not mean that the functions are exactly the same nor does it mean that the district hospitals are currently in compliance with these standards. 

To illustrate this point, the NHI Bill requires a CUP to monitor all payments it makes to service providers. On the other hand, the NNSDH assigns some financial management functions to district hospitals but does not list payments explicitly. In reality, most financial functions are centralised at the provincial level including the processing of payments. Similarly, whilst the NNSDH requires the district hospitals to carry out contract management functions, it is also carried out at a centralised provincial level.

Three mitigating steps 

The general pattern that emerges is that many of the functions assigned to district hospitals in terms of the NNSDH are in fact not carried at this level, but that they are rather centralised provincially. In short, it appears that most district hospitals are not in compliance with the national norms and standards which puts them at a disadvantage with regards to being able to support a CUP. 

The inability of the district hospitals to support the CUP during the transitional phase of the NHI roll-out will lead to further delays. This can be prevented through the implementation of a targeted mitigation intervention consisting of three distinct steps. 

The first step is a readiness assessment to determine a district hospital’s capacity to assist a CUP, specifically in relation to the functions assigned in terms of section 37 (2) of the Bill. This can be facilitated by using the Office of Health Standards Compliance (OHSC) to establish compliance with the NNSDH. Using the OHSC will accelerate the process as it obviates the need to develop a new programme. It will also utilise existing capabilities, significantly minimising the need for additional resources. 

The second step consists of rolling out capacity building initiatives aimed at addressing the issues identified during the assessment. As in the previous step, it would be advisable to leverage existing processes and programmes as this would significantly decrease the costs as well as the turnaround times required for the intervention. A vast amount of experience has been gained through the Ideal Clinic programme that is funded through the National Health Insurance Indirect Grant. It should not be difficult to adapt the strategies, methodologies and tools used during this programme to capacitate district hospitals.

As noted previously, a lot of the functions assigned to district hospitals are currently centralised at provincial level. This prevents hospitals from developing the experience and the competence in critical functional areas such as financial, contract and supplier management, all core CUP functions under section 37 of the Bill. Most district hospitals will therefore not be in a position to support the CUPs with reference to these functions, even after capacity building initiatives have been concluded. As a final step, it is, therefore, necessary to gradually devolve the previously centralised functions down to the district hospital so that it can develop the necessary competencies. 

Experience and innovation

South Africa has gained a lot of knowledge, experience and expertise in the implementation of tailored interventions in its response to the HIV pandemic, and more recently in the early response to the Covid-19 pandemic. 

Many of the successes recorded can be ascribed to innovations introduced at district operational level. A successful NHI will likewise rely heavily on effectiveness at this level.  

The NHI Bill correctly identifies district hospitals as key during the early transitional NHI phases. Failing to capacitate them could prove disastrous. DM/MC

*Rensburg  is Director of the Rural Health Advocacy Project and Botha is an independent health economist.

This article was published by Spotlight — health journalism in the public interest.