Health care is redistributive. Those of us who are healthier and wealthier always subsidize the care—in some way—of those who are sicker and poorer. (Students in my courses hear me say this dozens of times every semester.) What happens when the gap between those who have wealth and access to care is vast? Will those with the resources share with those who lack them? South Africa is the test case. Wealth in South Africa is less equitably distributed among the population than in almost any other country. The Gini Coefficient is about .69 (the higher the number the less equitable the distribution of wealth).

The Constitution of South Africa includes an explicit right to health care for all as a core responsibility of the government. In 2011 the government set the country on a 14 year path to National Health Insurance. The plan has been most completely described in an official White Paper issued in 2016. The goal is to provide equitable access to quality care for everyone by pooling all the money now spent for health care into a National Health Insurance Fund controlled at the National level. All citizens will be required to enroll in the program. Care will be largely free at the point of service. The White Paper calls for the National Fund to purchase clinical services through contracts with reorganized primary care and hospital networks. Public primary clinics that are now run entirely by nurses are expected to expand their scope of services to meet new national standards by hiring or contracting with physicians now in the private sector. The clinics  will be paid capitation fees for the individuals who select them. Hospitals, both public and private, will be paid on a uniform DRG based system. The effect will be an increase in resources for public clinics and hospitals and a significant decrease in prices to private doctors and hospitals who will be expected to make up these losses by serving many more people. The current private insurance companies will have no or minimal roles in future according to the White Paper. Costs will be managed and quality improved through implementation of a sophisticated electronic medical record system. The White Paper includes calls for greater attention to upstream determinants of health and prevention, but the focus is on curative medical care because, as one senior official said: South Africa has an extraordinarily high burden of disease.The tone of the White Paper is aspirational. It calls for a huge transformation but provides no details on how to get from here to there.

Some economists and public health experts think South Africa spends about enough money and has enough health professionals to care for the population if resources can be reallocated.  South Africa spends  8.8 % of its GDP on health, which is about the average for OECD countries. However, 84% of the population relies on a public sector delivery system that consumes about 4.1% of GDP. 16% of the population relies on an entirely separate private insurance and delivery system that consumes 4.4% a bit more than the public sector.

This inequity plays out in stark terms and is the core of the current debate about national health reform in South Africa.  Virtually every conversation, policy paper, newspaper or taxi-cab interview starts with some version of this inequity. For example the Minister of Health recently noted that 80% of medical specialists are in private practice, serving only 16% of the population. He said that one private hospital in Johannesburg has 30 affiliated gynecologists while the entire province of Limpopo in the Northern part of the country has seven South African gynecologists for its 40 public hospitals. (Cape Times, Feb 21, 2017) He said the private gynecologists earn more than five times what the public sector specialists earn but that under National Health Reform, their excessive fees would be reduced and they would take care of more poor people.

How reallocation is supposed to happen is completely unsettled. There are small government sponsored work groups developing specific proposals but none of the issues of governance, finance, operations or professional autonomy have been settled. New policy development is already stalling out in anticipation of a national election that will bring new leadership to the country in 2019.

Every government official and professional level person I met in my recent trip to South Africa has private insurance and uses the private system exclusively. Some shuddered at the thought of their doctors’ offices and hospitals being crowded with new patients. These senior people had considerable sympathy for the plight of those who rely on the public system but in the same breadth indicated that they didn’t want to give up what they now had.

Virtually all public employees and their dependents have some form of private medical insurance. Public employees will have to implement national health insurance policies but  concern for themselves and their families may be more powerful than political appeals for “solidarity” in health reform. They are already moving very slowly on health reform.

Not one of the craftspeople, workers, and small business owners I met has private insurance. Almost all said they “don’t get sick” or use the public system. They said it was “ok”. Spending the whole day waiting on lines was just part of going to clinic or hospital. Residents of a shanty town in Soweto told me they would go to a clinic nearby or to the big hospital—but they have to walk the several miles to get there because they can not afford a taxi. Only one uninsured person told me he had a private doctor whom he paid out of pocket. There was virtually no awareness that the government had proposed something called national health insurance and therefore no expectation that their own access to care might change. For them, South Africa has universal health care. It just doesn’t work very well. My questions to experts about consumer expectations for health reform were met with blank stares.

There is deep and mutual distrust between the public and private sector leaders at the national and provincial levels. However collaboration among the actors is a core component of the proposed reforms. High level government officials argue the distrust can be managed and resolved through stringent contracts. Academics who have studied provincial and district operations on the ground dismiss the possibility of writing and enforcing sophisticated contracts. One of them said: “The people promoting contracting have no idea what actually goes on at the operating level. They have never been there.”

All of the people I interviewed were deeply skeptical that progress would be made toward national health insurance anytime soon. One very senior official who was a prime author of the White Paper suggested I stop thinking about health insurance. Rather, think about delivery system reform. Nevertheless, there was a very strong feeling of optimism that  health equity could be improved among most of my interviewees. They pointed to the successful implementation of HIV/AIDS testing and treatment throughout the country in the public sector. We did that, they all said, so maybe we can fix health equity as well. I hope they are correct.