News Flash 17 May 2024 – SOUTH AFRICA – National Health Insurance Bill signed into law

On Wednesday, 15 May 2024, the President assented to the NHI Bill (the National Health Insurance Act) which will take effect on a date proclaimed by the President in the Government Gazette. This Act’s purpose is to create and preserve a national health insurance fund in the republic that is financed by mandatory prepayment.

Last year both the National Assembly (NA) and the National Council of Provinces (NCOP) passed the NHI Bill, which is meant to guarantee cost-free healthcare services for all South Africans, regardless of whether they seek treatment in public or private health facilities.

This Act does not apply to members of the National Defence Force and the State Security Agency. The health care services will be available to South African citizens, permanent residents, refugees, inmates and certain categories or individual foreigners determined by the Minister of Home Affairs. Asylum seekers or illegal foreigners will only be entitled to emergency medical services and services for notifiable conditions of public health concern.

South Africans are very concerned about the NHI, particularly those in the middle class and higher income groups who bear the greatest portion of the tax burden. They are worried about the impact this will have on their medical insurance, healthcare, and the taxes they will have to pay to fund the government’s ambitious objectives.

That the NHI has been signed into law does not mean it is operational, however, and members of medical aids should not cancel their memberships.

The plan is to roll out the NHI gradually over time, but no timeline is mentioned in the bill. Additionally, owing to the uncertainty, it is expected that there will be legal challenges which could drag on for a long time.

It is likely that the NHI will be delayed for many years, possibly even decades.

Once the NHI is fully implemented, medical aids will not be allowed to cover services that the NHI pays for. In its current form, the bill does not explain what fully implemented means or which services the NHI will cover.

Ultimately in the future, the full implementation and operation of the National Health Insurance Act may have tax and medical health cover benefits implications for employees and employers.

To view the NHI Bill, follow the link.