Medical Healthcare funds in the country are buckling under the pressure of increased cost of healthcare with five out of the eight registered funds currently operational, it has been revealed.
The operational five medical funds include the Renaissance Health Medical Fund, Nammed, Namibia Health Plan (NHP), Namibia Medical Care (NMC), and Heritage Health Medical Aid Fund Namibia.
The closed medical aid funds are reported to be Napotel, GemHealth Medical Scheme, with BankMed Namibia, a medical aid provider for banks in Namibia reported to be winding down operations.
The distressing trends affecting Namibia’s healthcare system have been brought to light by a comprehensive study conducted by the Namibian Competition Commission (NaCC) titled “A Study into the Namibian Private Healthcare Sector, 2000-2021.”
The study reveals a concerning 320% increase in the cost of private healthcare services in Namibia between 2005 and 2021.
The average beneficiary on a medical scheme spent just over N$5 395.71 annually on all medical benefits in 2001 and by 2021 this has increased to around N$21 449.54 per year – a 298% increase in costs, the study found, the largest chunk of cost being seen in hospitals (35%), followed by pharmaceuticals (16%), and specialists (11%).
In terms of cost pull and push factors, the annual medical aid fund premium increases according to the NaCC study are mainly driven by other costs such as doctors’ costs, technology enhancements, over utilization, facilities, and medication (pharmacies).
The study revealed that the main funders in Namibia’s healthcare system, which includes medical schemes, medical scheme administrators, and brokers, play a crucial role in providing healthcare financing to individuals in the country through monthly contributions.
The Namibia Financial Institutions Supervisory Authority (NAMFISA) Corporate Communications Practitioner, Joanette Eises said supervision cannot guarantee protection against unforeseen factors that may impact a fund’s fate.
She further highlighted the importance of swift intervention when a medical aid fund faces non-compliance with prudential supervision requirements.
“Namifisa plays a critical role in overseeing the medical aid funds industry, ensuring compliance with the Medical Aid Funds Act, 1995, and other relevant regulations. Our rigorous monitoring and enforcement approach involves regular inspections, risk assessments, and tailored corrective measures for each fund’s specific circumstances,” said Eises.
As a result, she noted that Namfisa, therefore, expects the medical aid fund industry to comply with both the letter and spirit of the above-mentioned applicable legislation, as well as take into account Namfisa’s supervisory assessment of a medical aid fund’s prudential status, which includes its financial condition, governance and risk management.
Regarding recent speculation surrounding BankMed Namibia, one of the registered medical aid funds under Namfisa, the organization clarifies that due to legal constraints, the regulator cannot disclose any details regarding the Fund’s financial status or future sustainability.
According to the NaCC study, the dramatic rise in the cost of healthcare has placed significant financial pressure on operational medical aid funds, making it challenging for them to cope with the mounting burden.
The study also delves, “into the barriers faced by healthcare professionals, facilities, and funders in the private healthcare sector. Structural, regulatory, and behavioural barriers have added to the challenges encountered by medical aid funds, making it difficult for healthcare facilities to provide quality services”.
The study notes that with the continuous increase in healthcare costs, industry stakeholders are expressing concerns about the equitable distribution of profits and benefits within the sector.
“Addressing these challenges will require collaboration among healthcare funders, regulatory authorities, healthcare professionals, and policymakers.
Implementing transparent and effective measures is vital to mitigate the impact of escalating healthcare costs and ensure the continued provision of quality medical services to Namibian citizens,” the expert noted.
