How National Health Insurance will affect you

[wisp]

NATIONAL health insurance (NHI) looks set to cure at least one ill: hypochondria.

The new universal healthcare system may affect you in many ways. For some people, it could hike medical costs considerably, while for others it could curb the tendency to run to health specialists for every ache and pain.

Last month, the ANC gave momentum to the NHI process, announcing when it will be implemented (starting 2012, phased in over 14 years) and giving some indication on how it will be funded (your pocket).

While the NHI has come under heavy criticism, there is consensus that healthcare in SA needs an overhaul.

According to a recent report in the SA Medical Journal, about 8.5% of SA's gross domestic product (GDP) is spent on health.

About 5% of GDP goes towards the 7 million people in private healthcare, while 3.5% caters for the other 41 million people.

The ANC's plan is to give everyone free, improved healthcare.

If you earn an income, you will be required to pay a percentage as an "NHI tax". Other taxes, including a hike in VAT, are also on the cards. Tax deductions for medical contributions ? currently worth R10bn to R15bn a year ? will be phased out.

Government plans to spend billions on revamping hospitals and aims to fill all vacant posts in the public health system by 2012, but private hospitals are also expected to be contracted in to provide NHI services. Some doctors in private healthcare may be accredited with the NHI to treat patients.

You can also choose to remain a member of a medical scheme, but you will still have to pay the NHI tax and will lose your tax deductions on contributions.

While there still are huge uncertainties, particularly over the role of the private sector, there are some steps you can take to safeguard yourself against NHI fallout.

1. Start saving

You should consider putting money away now to make provision for the NHI's impact on your finances, says Len Deacon, CEO of
the Topmed medical scheme. Deacon, a former head of Anglo American's medical scheme and is also an independent consultant,
expects the NHI to certainly hike healthcare costs for many people.

Currently, it looks like a dedicated NHI tax of between 3.5% and 5% will be levied on your salary from 2012.

On a salary of R20 000 that could be under R1 000 ? similar to what most people would be paying now for a comprehensive option, says Heidi Kruger, spokesperson for the Board of Healthcare Funders, a body which represents medical schemes.

However, other taxes, including VAT, will also be hiked to fund the NHI. Also, tax allowances on medical aid contributions will be scrapped. One study has suggested that the income tax rate for high income earners will climb from 41% to 45%.

This makes it important to invest an additional amount to make sure you have enough savings to tide you over, should you decide to remain a medical scheme member and face a squeeze on your disposable income.




For full article click below
http://www.fin24.com/PersonalFinance/Money-Clinic/How-NHI-will-affect-you-20101011

I wonder if national health works the same in the Uk, maybe our UK based members could fill us in.

Do you think that NHI is a good or bad thing , comments please

[Cleric]

****sakes. Adding a further 3%-5% tax on my salary will really **** me the **** off. Gawdammit.

[onona]

I am generally in favour of national health care schemes, except in the case of countries where the majority of the population does not pay tax. Like South Africa. In which case, it's a disaster waiting to happen. There is simply no way the government will be able to effectively and successfully sustain a national health care system in a country like South Africa where only a small percentage of the population contribute tax, while a huge percentage of the population is in dire need of expensive health care for AIDS.

This is a ****ing pipe dream for SA, clearly the government hasn't thought it through. National health care schemes have many flaws, which will become very, very apparent in a country like SA. Even in a comparatively wealthy, first world country like the UK, there are funding shortages and numerous other issues - how the **** is SA going to deal with that? They can't.

And you know what - I don't even care if some of you knee jerk people go and call me a racist for this, but this is just another way that the SA government is going to screw over the whites. Anyone who denies this is kidding themselves.

[Nferno]

And you know what - I don't even care if some of you knee jerk people go and call me a racist for this, but this is just another way that the SA government is going to screw over the whites. Anyone who denies this is kidding themselves.

Agreed.

Off-topic, it's always weird that when white people try to defend themselves, even if it's totally justified, it's considered racist. I'd even go as to say that we've been conditioned to feel guilty when defending the obvious or standing up for ourselves because of wrongdoings in the past.

It's okay that 20 years later appartheid is still being rubbed in white's faces and they have to deal with it, yet they've been getting ****ed for the last, let's say, 10 or so years and every time they open their mouths, ********s like Malema are quick to pull the race card.

[wisp]

And you know what - I don't even care if some of you knee jerk people go and call me a racist for this, but this is just another way that the SA government is going to screw over the whites. Anyone who denies this is kidding themselves.

Agreed , the minority will pay for the majority as is the case with most things in SA.My wife works for a dentist and they have already been told that the large majority of Doctors and Dentists in private practise will be become state Doctors , with salaries and trariffs being dictated by the state. I can see mass immigration of doctors and a drop in health standards

[BattleMoose]

It is honestly the most ridiculous idea I have been exposed to in a long time, I thought it would quietly die away when it was first brought up but looks like it is actually going to become a reality. :-/

As mentioned before, I think social welfare and national sponsored health care are a fantastic idea in first world countries. Unfortunately South Africa can in no way in a position to finance or manage this nonsense. It is going to further **** of people who will still choose to use private health care, which will cost more now and will have to pay more tax for the rest of the population, like South Africans don't need more reasons to emigrate, further exasperating the disproportionately between taxpayers and non-taxpayers.

Also, will this increased taxation actually yield better health care, or will it rather and more likely become a huge opportunity for corruption and fraud?

EDIT: I am so glad I will be out of this country before the end of the year. First world health care for me, non-negotiable, kthxbi.

[cr@zydude]

I am generally in favour of national health care schemes, except in the case of countries where the majority of the population does not pay tax. Like South Africa. In which case, it's a disaster waiting to happen. There is simply no way the government will be able to effectively and successfully sustain a national health care system in a country like South Africa where only a small percentage of the population contribute tax, while a huge percentage of the population is in dire need of expensive health care for AIDS.

This is a ****ing pipe dream for SA, clearly the government hasn't thought it through. National health care schemes have many flaws, which will become very, very apparent in a country like SA. Even in a comparatively wealthy, first world country like the UK, there are funding shortages and numerous other issues - how the **** is SA going to deal with that? They can't.

You are right that this is a pipe dream. SA just doesn't have the tax base to make this work yet. Our goverment hosiptals desperately need an overhaul, but I don't know if this would work. Even in the UK they are closing down hospitals, and the budget deficit just keeps growing.



And you know what - I don't even care if some of you knee jerk people go and call me a racist for this, but this is just another way that the SA government is going to screw over the whites. Anyone who denies this is kidding themselves.

I think that that is a rather simplistic way of looking at it.

[GeometriX]

If 3-5% of my income went to educating poor people - a process that would enrich the country in every possible way, right from the first day it's used - I'd gladly pay it. I might sound like a selfish jackass when I say this, but NHI will do nothing to benefit me now or in the long term, and that's not okay.

[CrashHelmut]

That 3.5%-5% figure seems a bit conservative considering the cost estimates I've read about regarding this scheme. But even at 3.5% it is much higher than what my current medical costs are (I'm on a hospital plan, and take good care of my health).

From the reports I've read, it also seems that NHI facilities will at first only be available in rural areas. So, not only are we forced to contribute to this, but we cannot make use of the facilities. So, those of us that are currently using a private medical scheme will still have to continue to use one in the immediate future.

But wait, there's more. Now we won't even get a tax allowance on private medical aid contributions. Whoo boy.

[Cleric]

If 3-5% of my income went to educating poor people - a process that would enrich the country in every possible way, right from the first day it's used - I'd gladly pay it. I might sound like a selfish jackass when I say this, but NHI will do nothing to benefit me now or in the long term, and that's not okay.

Not to mention all the corruption and "administrative charges" that will dilute the amount before it get's to the intended purpose.

[onona]

If 3-5% of my income went to educating poor people - a process that would enrich the country in every possible way, right from the first day it's used - I'd gladly pay it.

This. The lack of education in South Africa is one of the biggest issues facing the country's development. Better education = better quality of life for all, because people will make better decisions with their lives, and more people will contribute to the economy. Why the government has chosen to focus on healthcare that it can't properly implement or maintain instead of focusing on education of the uneducated masses is really quite beyond me.

[Cleric]

Because comparatively speaking, RSA spends more than enough on education. The problem there lies not in the spending, but in the flawed implementation.

[onona]

Because comparatively speaking, RSA spends more than enough on education.

You think so? I'd say the only time a country is spending enough on education is when education, from primary through tertiary, is free for everyone. That's certainly not the case in SA, or indeed most countries.

[Cleric]

Free education for everyone always? Hmmm, sounds nice.

But I think you're missing the more interesting aspect of my point. Specifically that while RSA is spending a LOT on education (and it is free for people who find themselves in disadvantaged circumstances), it has not translated into results. So clearly the problem lies in implementation, be it flawed sylabi (sp?), lax reporting standards, incorrect focus, or a top to bottom structural problem.

[BattleMoose]

So clearly the problem lies in implementation, be it flawed sylabi (sp?), lax reporting standards, incorrect focus, or a top to bottom structural problem.

This, there are much bigger problems within the educational system than finances or lack thereof, and no amount of money can fix the existing problems.

Namely, uncommitted/striking teachers, mismanagement, fraud.

[vii]

This, there are much bigger problems within the educational system than finances or lack thereof, and no amount of money can fix the existing problems.

Namely, uncommitted/striking teachers, mismanagement, fraud.

Teachers being treated like crap, Being payed little to nothing... the list goes on.

All this can be solved if the money set aside for education would actually go to the schools... Pay the teachers well, and they'll work or lose their nice paycheck. Treat them well and they'll take pride in their work.

We live in a flawed society which won't get better until we fix the basics.

[dislekcia]

Isn't the immediate problem with taxation that people don't see the benefits? If you have an obviously HELPFUL system like healthcare that's openly funded by taxes, then you have a reason to point at people and say "Pay your ****ing taxes and **** will get better!".

It's like everyone assumes people will never START paying taxes if they don't pay them at the moment.

[Cleric]

But that's missing the issue that those who pay the taxes are not the ones who receive the benefits.

[BattleMoose]

It's like everyone assumes people will never START paying taxes if they don't pay them at the moment.

I honestly think that a large portion of the population is actually like this. People living on grants, having children for grants, domestic workers and taxi drivers, hawkers and others.


But that's missing the issue that those who pay the taxes are not the ones who receive the benefits.

Also this.

I also take exception to the point that these monies are not actually fixing the 'problem' but rather maintaining a clearly dysfunctional system.

[wisp]

But that's missing the issue that those who pay the taxes are not the ones who receive the benefits.

Yes but in politics they call that "righting the injustice of the past" for all the PDI , never mind that it will cause most taxpayers to becoming CDI.

[Wesley]

Also, what about those with existing medial aid? The extra taxation won't help me because I'll be getting better healthcare through that. It's like the idea the SABC previously had of making the TV license part of tax - if I don't watch any TV, I don't want to have to pay this tax.

[Cleric]

Yes but in politics they call that "righting the injustice of the past" for all the PDI , never mind that it will cause most taxpayers to becoming CDI.

This is not a "previously disadvantaged" issue. This is a "middle class paying for the lower class" issue, and it exists everywhere.

[dislekcia]

But that's missing the issue that those who pay the taxes are not the ones who receive the benefits.

Every single time that argument is used, I see an opportunity to point out to the people receiving the services that those same services could be so much better if more people paid taxes. It seems a completely logical leap to stress that even harder with a system that basically everyone wants (national healthcare) that simply cannot work with the current tax paying population base. Yes, it seems counter-intuitive to set something up to fail, except when the mechanism to prevent or recover from that failure is something everyone has access to: ****ed off that your clinic sucks? Pay your taxes.


I also take exception to the point that these monies are not actually fixing the 'problem' but rather maintaining a clearly dysfunctional system.

Which system are we talking about here? Corruption in goverment, education as a whole, medicine as a whole or simply the mechanisms of tax collection in general? I'm not following.


I honestly think that a large portion of the population is actually like this. People living on grants, having children for grants, domestic workers and taxi drivers, hawkers and others.

The problems of taxing a cash economy are completely different to what those taxes are earmarked for. How did you start paying taxes? You didn't have a choice, it was in the way you were paid. Most people in SA aren't trying to avoid taxes (that comes with business ownership and threshold income levels) they simply don't factor into their lives. Making taxes a prerequisite for a needed service makes sense as a means to elevate the issue of taxation in national consciousness beyond a retarded whine-session for people who feel hard done by.

[dislekcia]

Also, I want to live in a healthier society because of the benefits of people being healthy: Smaller families, more long term planning, less risky behavior (like gambling or get-rich-quick opportunistic crime), etc. As such, I'm willing to pay taxes in order to help other people be healthier because it benefits me in the long term.

[BattleMoose]

Which system are we talking about here? Corruption in goverment, education as a whole, medicine as a whole or simply the mechanisms of tax collection in general? I'm not following.

The entire economic system. Incredibly high unemployment rate, small amount of tax payers, high amount of people dependent on government grants and a whole host of issues that discourages investment such as degrading road infrastructure, incredibly strained electricity supply, incredibly unreliable rail infrastructure and high telecommunications costs, very lenient labour laws, BEE policies and a largely dysfunctional bureaucracy rampant with corruption, these issues are in direct or indirect control of the government.

Addressing and fixing these issues will have positive knock-on effects throughout the economy. The most important thing that the government can do in terms of growing the economy, is by creating an environment that is indusive to investment and minimization of unnecessary costs to business.

Such things could include:

Reliable rail link between Durban and Gauteng.
Security, so people and business don't have to experience the added costs of private security, or losses from crime or bankruptcy due to crime.
Reliable electricity supply, guarantee of a connection for new developments.
(Every single new office block that I am aware of that is being constructed includes back-up generators, expansion of some developments include very expensive alternative energies because Eskom will not provide and some new developments cannot proceed because of refusal of connections)
Waterproofing traffic lights.
Costs of time spent dealing with incompetent bureaucracies on all levels on all issues.
Competent and reliable national telecommunications company.

It actually makes me really angry when I think on what the government should be doing and what they are actually doing.


The problems of taxing a cash economy are completely different to what those taxes are earmarked for. How did you start paying taxes? You didn't have a choice, it was in the way you were paid. Most people in SA aren't trying to avoid taxes (that comes with business ownership and threshold income levels) they simply don't factor into their lives. Making taxes a prerequisite for a needed service makes sense as a means to elevate the issue of taxation in national consciousness beyond a retarded whine-session for people who feel hard done by.

If I could see really important issues improving I would be whining a lot less. Having a reliable and cost effective rail link between Gauteng and Durban is critically important and the lack thereof is just so bizarre, as well as the acceptance thereof.

TLDR: South Africa cannot afford to be a welfare state and government isn't doing what it needs to in order to grow the economy.

[CraftyDick]

This angers me so much!

These asshats want nationalization of mines, health-care, land, ownership of everything, the list goes on and on. Meanwhile they aren't taking care of the more important issues.

The same month the striking began, the gov heads were excepting ridiculous bonuses and raises for themselves while refusing to resolve a critical matter.

The problem lies in the fact that the majority of the voting public are to oblivious and ignorant to realize what's going on. They think that, just like they thought in the 1994 elections that when the thing they are pushing for comes to realization, that they all will be given a mansion the very next day.

I pay an amount for private health-care. I am a healthy person and only go to the Dr. when absolutely necessary. I kinda feel guilty when I go for anything less then life threatening. I have a medical scheme to ensure that when I am in a big car accident for instance, I can go to an adequate health care facility.

But, because a lot of sickly sponges have private health care, I have to pay more for my scheme to support them and their inevitably doomed bodies. I remember a time when I didn't even think about health care on a private basis.(I did belong to one) and having to pay a surplus amount for my medicine was not even heard of. Now I have to pay for things I hardly ever need to support the majority. Best part of all, is that with this tax thing, I might even be losing more money than before.

I can't take this anymore. Can't wait for 12-21-12! This world must come to an end!

[CraftyDick]

And another thing. Back in the day, public health care was top notch. Some public hospitals had even more state-of -the-art machines than did the private hospitals. But in the past 16 years, no attempt to better the public health sector has been made. Now they want to do it when it is already too late, just like with the electricity, and this is what causes the heavy taxing.


What about the issue of our drinking water? This isn't even a real concern to them. They think that you open the faucet and water comes from the magic land.

Mismanagement, nepotism, and hiring of incompetent swine is rampant in this country.

[SC(+)PE]

I'd quite happily pay if I could put on a sign on every hospital's door, "no tax number, no service".

I personally see no problem in people (adults) dying because they do nothing to sustain their existence. I know that sounds harsh, but it's actually rather conservative, since anyone attempting to find work, successful or not, is excluded from the statement.

This attempt of our government to succeed where first world countries have failed reminds me a lot of our education system. Government fatcats that are doing their best to out-greed the apartheid fatcats of old will get more money.

As far as I'm concerned, it simply means my spending stays the same, 5% extra tax and VAT might go up, oh well.

[CraftyDick]

This attempt of our government to succeed where first world countries have failed reminds me a lot of our education system. Government fatcats that are doing their best to out-greed the apartheid fatcats of old will get more money.
.

Well said.