HMI panel chair, Justice Ncgobo (left), and Competition Commissioner Bonakele, listen in on yesterday's inquiry presentation proceedings

By guiding
the Health Market Inquiry (HMI) through all its moments and challenges to reach
its comprehensive finality with the presentation of the report to government
this week, the Competition Commission (CC) has made up for the consequences of
its 2004 decision to halt collective bargaining between funders, hospitals and
medical practitioners, commissioner, Tembinkosi Bonakele, light-heartedly
indicated as HMI presentation proceedings due to a close in Sandton yesterday.

“We are now
in full support of the multilateral bargaining forum proposed by the inquiry
panellists!” he stressed.

An embryonic
factor prompting the initiation of the inquiry more than six years’ ago was
government’s, and notably former Minister of Health Dr Aaron Motsoaledi’s
persistent references to unsustainable price escalation in South Africa’s private
healthcare sector.

Counter-arguments
from the private providers, namely the hospitals and medical practitioners, were
that there were no longer regulatory price controls pertaining mainly to
tariffs and fees with the demise of firstly the National Health Reference Price
List (NHRPL) and the subsequent RPL. The absence of controls, therefore, they
claimed, was a major contributing factor to the cost escalations.

Motsoaledi’s
response, simply put, was “let’s see” which ultimately led to the CC being granted
formal powers on 1 April 2013 to conduct a market inquiry based on “reasons to
believe that there were features of the healthcare sector that prevent, distort
or restrict competition”.

“It is
generally known that prices across key segments of the private health care
sector have risen above inflation. The consequences of this,” the CC added in
its inquiry launch statement, “is that only a minority of South Africans can
afford private healthcare services.”

Price
uncertainty, HMI Panel Chair, former Chief Justice of the Constitutional Court,
Judge Sandile Ngcobo, acknowledged when summarising the report yesterday, was
one of the issues that came up frequently during the investigation. This, he added,
was largely due to the cost escalations experienced after the 2004 Competition
Commission banning.

“It therefore
became clear that it was imperative to eliminate what stakeholders described as
a ‘tariff vacuum’ and that a multilateral bargaining forum be established for
this purpose,” said Ngcobo.

Main
difference between this forum and previous initiatives, he noted, would be that
it will operate under the auspices of a regulator to ensure that competition
rules “are not flaunted”.

“Competition,”
Ncgobo reminded his audience, “is based on price, cost and quality, not on
avoidance of risk!”