AfriForum served a summons on President Cyril Ramaphosa and health minister Aaron Motsoaledi on Wednesday, as part of the organisation’s legal action to challenge the constitutionality of the National Health Insurance (NHI) Act.
The act, signed into law in 2024, establishes a single, state-run fund to provide universal, free and quality healthcare for all South African citizens and residents.
AfriForum instructed the sheriff of the court to serve the combined summons on the president, Motsoaledi, the minister of finance, the speaker of the National Assembly and the chair of the National Council of Provinces, informing them it had instituted action against them in the Pretoria high court.
In the particulars of claim, AfriForum seeks to have the NHI Act declared unconstitutional based on various grounds.
“The plaintiff foresees material factual disputes, requiring cross-examination to arise in the action,” the organisation said in its particulars of claim.
It said this will require the presentation of both factual and oral evidence.
One of the grounds of the constitutional challenge was that there will be a diminution of the constitutional powers of provinces.
It was within the constitutional purpose and design that certain governmental competencies and authorities, such as health services and basic education, were decentralised and devolved upon and delivered through provincial governments, AfriForum said.
It said to achieve this constitutional design, a substantial portion of nationally raised taxes was allocated to provincial governments and distributed using the provincial equitable share (PES) formula.
“The act, by centralising the funding of healthcare services and the purchasing of healthcare services, medicines, health goods, health products and health-related products, undermines the constitutional powers of provinces to budget, finance, plan and run healthcare services.”
It said the centralisation of the PES to the fund in terms of the act constituted an intrusion by the national government into the legitimate tax revenue of provinces allocated to the performance of their constitutionally mandated functions in respect of healthcare and ambulance services.
This was because these health services were constitutionally and legitimately the domain of provincial governments, inclusive of financing, planning, organising and service delivery required for the execution of these services by provincial hospitals, clinics and transport services.
“In the premises, and to the extent that the act adversely affects the constitutional functional areas of healthcare services and ambulance services rendered by provinces, the act is unconstitutional.”
Effect on medical schemes
AfriForum also said there were adverse effects on the private sector, patients and the clinical independence of practitioners. It said the act stipulates that once the NHI has been fully implemented, medical schemes may only provide complementary cover.
“This places the future existence of medical schemes and private health care at risk and creates financial uncertainty, thus undermining investment and adversely affecting the economy.”
It said the combined effect of the provisions of the act will eliminate the present available range of coverage options, substantially narrow the range of healthcare providers that patients may access without incurring prohibitive out-of-pocket expenditure, and limit the choice of patients when it comes to healthcare service providers and health establishments.
“The abovementioned represents a material reduction in freedom of choice, both in relation to medical cover arrangements and in relation to the selection of providers.”
In a media briefing announcing the action on Wednesday, AfriForum said although other institutions have already instituted legal proceedings against the act, this action was the first of its kind against this law.
Wian Spies, AfriForum’s legal representative in the case, said other points of unconstitutionality that AfriForum objected to include the restriction of the clinical independence of health practitioners and the lack of rationality of the NHI framework due to its economic unworkability.
AfriForum’s spokesperson on health, Louis Boshoff, said NHI was completely unworkable.
Boshoff said the worst thing that could happen to taxpayers was the allocation of funds — equivalent to 10% of South Africa’s GDP — to a health system that “will never function effectively”.
“The true cost of NHI will be much more than its mere rand value. The loss of, among other things, constitutional rights and patients’ freedom of choice will ultimately result in a much higher price being paid,” Boshoff said.
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