An inflated, opaque and anti-competitive pricing system in the healthcare industry is excluding the majority black South Africans from accessing decent healthcare.
For example, between 2002 and 2014, the cost of private healthcare rose from ZAR42 billion to ZAR142 billion annually – an increase of 300%. Today, the average South African spends 42% of their income on healthcare.
So high is the cost of this system, that only 17% of South Africans are able to afford the sky high costs. The remaining 83% – most black South Africans – are forced to use public healthcare which is chronically understaffed and underfunded.
How we compare to other countries
Commenting on the scandal, the World Health Organisation pointed out that South Africa has one of the most expensive healthcare systems in the world – on par with the UK, Germany and France.
Attempting to defend the indefensible, the Hospital Association of South Africa (HASA) suggested international comparisons are unfair due to the dominance of public health systems in countries like the UK.
However, the UK, Germany and France have average annual incomes ranging from ZAR 482,738 to ZAR 584,367, whereas South Africa’s average income per year stands at just ZAR 152,423.
More strikingly, StatsSA reports that the average income of black South Africans is ZAR 92,893, whilst the average income of white South Africans is ZAR 444,446 – much closer to the average incomes of the UK, Germany and France.
In short, a healthcare system priced on par with countries like the UK, Germany, and France, will only be affordable to people whose earnings are also on par with citizens of those countries.
Who are these people? White South Africans.
According to Health Minister Aaron Motsoaledi, if these trends are to continue, South Africa’s private healthcare system will cost as much as half a trillion rand by 2026 – a shocking figure given just 17% of the country has access to these services.
Responding to the crisis, Competition Commission SA is currently investigating if the shocking rises in the cost of healthcare is driven by market collusion.
Unrepentant however, South Africa’s biggest healthcare companies continue to announce above inflation, bonanza increases in the cost of healthcare.
This scandal simply could not happen anywhere else in the world. And if the Health Minister’s prediction is anything to go by, the trends are set to get worse unless action is taken.