Health Financing – Presidential Health Compact

The Presidential Health Compact (PHC) was launched at the Presidential Health Summit (PHS) in October 2018 to diagnose and propose solutions to end the identified crises in the health system that are hampering South Africa’s progress towards creating a unified, people-centred and responsive health system that leaves no one behind. The Presidential Health Compact document has 10 pillars with Pillar 6 focusing on improving financial management and systems to realise greater impact and efficiency. Dr. Fareed Abdullah, unit director of the Office of AIDS and TB Research (OATB) at the SAMRC, is the lead of the pillar 6 Task Team and is supported by the rest of the OATB as well as Dr. Kim Jonas from the Health Systems Research Unit.

The SAMRC collaborated closely with colleagues from the University of the Witwatersrand and the Southern Centre for Inequality Studies on a Public Economy Project to publish a working paper entitled - Financial Directions and Budget Trends in Government Healthcare. This report provides evidence and analysis that can assist in taking forward the agenda of the Presidential Health Compact. It does so by reviewing the financial performance of the government healthcare system over the last decade. After assessing the financial management performance, it looks at the “financial health” challenges facing the system, including the problems of accruals and medico-legal claims. The report then examines the budget pressures faced by provincial healthcare departments, as well as the different allocation of resources and levels of care across provinces. It ends with a conclusion and tentative reflections informed by the evidence.