Date: 17/06/2004
Source: Ministry of Health
Title: M Tshabalala-Msimang: Media briefing on Health Department Budget Vote
MEDIA BRIEFING BY THE MINISTER OF HEALTH, DR TSHABALALA-MSIMANG ON HEALTH DEPARTMENT BUDGET VOTE, 17 June 2004
Introduction
The aim of this briefing sessions is not to duplicate my speech in the budget debate, but to give you more information on the parts of the speech that are likely to be most newsworthy. I am not going to dwell on the first half of the address -- which is largely a review of the last term of government. Instead I have selected a few items from the latter part. And of course you are all free to ask questions on any topic arising from the speech.
The budget itself
The national health budget for the current year is R8, 7-billion which represents an increase of 4,8% on last year. As you will note, very little of this money goes to running the national Department as 88% of it comprises conditional grants to provinces for particular programmes.
The combined health budgets of the national Department and the nine provinces will exceed R40-billion in the current year.
From this figure you will realise that provinces get most of their health financing through the equitable share that is voted directly to provinces and apportioned by provincial legislatures. The decisions of these legislatures are crucial in determining the adequacy of health financing for the year. I am pleased to be able to report that the trend towards equity in health spending across provinces is sustained in the current year. The biggest increases are being effected in those provinces that have the lowest per capita health spending - and so the gap continues to narrow, as it has done for several years.
Community service for nurses
It is our intention to introduce community service for professional nurses -- that is, for nurses with four years of training -- in January 2005. The process for nursing is a bit more complex than for the other professions for a number of reasons:
* Some nurses do the four-year training in one go, while others train initially as enrolled nurses (which takes two years) and after a period of service do a bridging course to get the professional nursing qualification
* Some nursing training is provided by public sector nursing colleges and universities and some is provided by private hospital groups
* Nursing training is funded quite differently from other training, with most students earning an income throughout their training.
The numbers that we are talking are quite large -- in 2003 about 1 500 student nurses completed the four-year course and about 1 800 the bridging course. So there really does have to be thorough preparation over the next six months.
I am certain that with the cooperation of all stakeholders, including nursing trade unions and private hospital groups, we should be able to address these challenges in time for the introduction of community service next year. The Nursing Council is fully involved in the planning process and has joined the Department in setting up a consultative forum. The forum will look into the distribution of community service nurses, conditions of service, adequate mentoring arrangements and the legal foundation for the process.
In my speech I link the introduction of community service with the Nursing Bill. But I should mention that there is an alternative, interim route if the Nursing Bill is not passed in time. And that would be to pass a small amendment to the existing law.
Finally on this subject, I would like to point repeat that community service has brought enormous benefits to areas that have lacked professional health services. Since we began this programme in 1999, about 11 000 new graduates have done community service. In many areas they have alleviated severe staffing shortages. Many have persevered in difficult working conditions and I really wish to recognise their work. I would also like to indicate that we are working with the provinces to improve the conditions of work for community service professionals. And, of course, those who work in rural areas are eligible for the rural allowances that were introduced from July last year.
Comprehensive Plan for Management, Care and Treatment of HIV and AIDS
The major part of our work of this financial year is the continued implementation of all the elements of the Comprehensive Plan. This includes emphasising the centrality of prevention in response to HIV and AIDS, strengthening of the national health system that should be able to provide continuum of care and sustain a series of interventions aimed at mitigating the impact of the disease. Provision of nutritional support particularly to those who are food insecure and promoting research and development of traditional medicine are some of the areas that are going receive much attention in terms of resource allocation.
As we began the implementation of the Plan, I requested the Medicine Control Council to fast track the registration of all medicines for AIDS related treatment including those for treatment of opportunistic infections. XXX (number) have since been registered through this fast track process. The MCC is meeting again on 02 July to finalise registration of XXX (number) that have been submitted for registration.
The process of finalising the tender for a long-term supply of antiretroviral drug to support the Comprehensive Plan for Management, Care and Treatment of HIV and AIDS is underway. We had about 40 companies that expressed interest in supplying these drugs. We short-listed them to 10 companies. We have already interviewed these companies and we are left with eight (8) suppliers that should receive request for quotations soon. These suppliers include both research based and generic companies.
The suppliers will have two weeks within which to submit their quotations. The prices will be discussed with Department of Health and tender should be awarded by the end of August. This process has taken longer than we expected. However, this has been necessary for us to achieve our main objective, which is a sustainable supply of ARVs at the best possible prices.
The interim measure through which ARV are current being supplied to provinces will continue until the main tender has been awarded. The challenges with regard to supply of drugs through this measure have to a great extent been resolved as we pass through the lead times needed to procure ARV's including paediatric version of these drugs. Provinces can therefore scale up their uptake of patients depending on the demand for treatment.
This year's Health Vote also provides for a major increase in conditional grant funding for the HIV and AIDS Programme. The allocation increases from R333-million in 2003/04 to R781-million in 2004/05. These funds are to be used to finance all the element of the Comprehensive Plan. Please note that these funds do not include substantial amount of resource allocated through equitable share to provinces to deal with burden of diseases in our facilities.
Medicines legislation
In my address I intend to highlight the policy of objectives of the Medicines and Related Substances Amendment Act and its regulations-namely to ensure that medicines become more affordable to South Africans and that they are more safely and effectively used.
On the issue of licensing of dispensing health professionals, let me say categorically that the intention of this policy is to ensure that health professionals who dispense are competent to do so and adhere to minimum standards of practice. This is why we have put in place a licensing system that requires every health professional who wishes to dispense to undergo training in order to be eligible for a licence.
Certain prominent members of the medical profession have stated that the training requirement is an insult to doctors. But the information that we have received from institutions providing the training is that some doctors who have been dispensing for years have failed the course by a wide margin. Clearly there is a need for specific training and dispensing is not something that is simply picked up on job.
You are aware that an organisation that calls itself the Affordable Medicines Trust has challenged the constitutionality of the licensing provision in the High Court. The matter has been heard and judgment is to be given on July 2. We are urging health professionals not to gamble with the care of patients and to complete the licensing requirements before that date. If the court rules that the provision is constitutional, it will come into effect immediately and any health professional who dispenses without a licence from that point onward will be acting unlawfully.
Let me turn now to the issue of transparency in medicine pricing. Our research indicates that large profits are being made on the sale of medicines. Indeed, it is widely admitted that medicine prices are often higher in South Africa than in many developed countries. What is bitterly disputed is who benefits from unjustifiable profit margins. Permit me to explain why the issue has been so clouded that every party in the supply chain could safely point fingers at the rest:
Until recently manufacturers charged different prices to different customers, using a complicated system of rebates, discounts and other incentives. Some companies did this to a much greater extent than others. As a result it was very hard to know the price of a drug as it left the factory gate.
Wholesalers and distributors added their mark-ups to the manufacturer's price and retailers then added their mark-up. These amounts were totally unregulated. The consumer knew that the price of medicines differed hugely depending on which pharmacy you went to. But nobody could say for sure who was taking excessive profits.
The medicines pricing regulations have tackled the challenge of reasonable pricing in a number of ways.
* They have scrapped and outlawed all discounts, rebates and other incentives
* They require manufacturers to set a single exit price for each product and to sell to all their customers at that price. The level of the single exit price is regulated through a prescribed formula
* They regulate the wholesalers' and distributors' fee indirectly by incorporating it into the single exit price
* They set a maximum dispensing fee for pharmacists and other health professionals who dispense medicines.
Some of these provisions - namely, those relating to dispensing and distribution fees -- are being challenged in court. But the single exit price is already in operation and has not been affected by the application that is currently being heard in the High Court here in Cape Town.
The Department has received 22 lists of single exit prices from various manufacturers and importers. We are currently analysing the impact of this provision on prices. Business Day recently quoted an analyst who suggested that prices of medicines have dropped by 16% to date. We should soon be in a position to give our own assessment. What I must point out is that the basis for calculating the single exit price will change early in 2004, when we will require companies to benchmark against an international average price for each product.
I would prefer to steer clear of the issues involved in the Cape High Court action, as we will be arguing before a full Bench today and tomorrow. Unlike some of the applicants, we do have respect for the sub-judice rules and we do not go about cynically disguising ourselves as consumers in order to argue our case through expensive adverts in the national press.
Cooperation with the Private Health Sector
As we begin this term of office, we are putting more emphasis on cooperation with all stakeholders to achieve the goal of better health for all. To improve interaction between public and private sectors, we have agreed with the private health sector that we need to develop a Health Charter. The Department of Health is drafting the framework for this Charter and we should be able to meet with other stakeholders to discuss the details of Charter by the end of July. The Charter will also lay out the core values that the private health sector should seek to uphold, including the ownership of private health services, Black economic empowerment and how the public and private sectors should cooperate and complement each other.
The role of local government
I will be referring this afternoon to the need for the national health Department to increase its support not only to provinces but also to local government. As you are aware, the National Health Bill envisages that local government will play a significant role in the delivery of primary health care services in the future.
The process will be phased in. Some functions are directly devolved to local government through various laws, while other functions will be contractually decentralised to the local sphere. The first step in this process occurs in July when environmental health services become a responsibility of metropolitan and district councils. We regard this as a positive measure and we believe that environmental health can be tackled very effectively by the authority that coordinates local development plans and the provision of essential services.
The practical implications - in terms of resources and personnel transfers - differ from province to province, and even from district to district. Our real concern is to ensure that the restructuring does not cause any disruption in services and that any difficulties that may crop up are flexibly dealt with by the relevant parties in a spirit of co-operative governance.
As I mentioned earlier, this session has been facilitated to allow the media to get more information and engage on some of the main issues contained in the budget speech. I would therefore like to end here and allow for questions that might which, I am sure; the health team that is gathered here will be able to attend to.
Thank you
Issued by: Ministry of Health
17 June 2004
Source: Ministry of Health
Title: M Tshabalala-Msimang: Media briefing on Health Department Budget Vote
MEDIA BRIEFING BY THE MINISTER OF HEALTH, DR TSHABALALA-MSIMANG ON HEALTH DEPARTMENT BUDGET VOTE, 17 June 2004
Introduction
The aim of this briefing sessions is not to duplicate my speech in the budget debate, but to give you more information on the parts of the speech that are likely to be most newsworthy. I am not going to dwell on the first half of the address -- which is largely a review of the last term of government. Instead I have selected a few items from the latter part. And of course you are all free to ask questions on any topic arising from the speech.
The budget itself
The national health budget for the current year is R8, 7-billion which represents an increase of 4,8% on last year. As you will note, very little of this money goes to running the national Department as 88% of it comprises conditional grants to provinces for particular programmes.
The combined health budgets of the national Department and the nine provinces will exceed R40-billion in the current year.
From this figure you will realise that provinces get most of their health financing through the equitable share that is voted directly to provinces and apportioned by provincial legislatures. The decisions of these legislatures are crucial in determining the adequacy of health financing for the year. I am pleased to be able to report that the trend towards equity in health spending across provinces is sustained in the current year. The biggest increases are being effected in those provinces that have the lowest per capita health spending - and so the gap continues to narrow, as it has done for several years.
Community service for nurses
It is our intention to introduce community service for professional nurses -- that is, for nurses with four years of training -- in January 2005. The process for nursing is a bit more complex than for the other professions for a number of reasons:
* Some nurses do the four-year training in one go, while others train initially as enrolled nurses (which takes two years) and after a period of service do a bridging course to get the professional nursing qualification
* Some nursing training is provided by public sector nursing colleges and universities and some is provided by private hospital groups
* Nursing training is funded quite differently from other training, with most students earning an income throughout their training.
The numbers that we are talking are quite large -- in 2003 about 1 500 student nurses completed the four-year course and about 1 800 the bridging course. So there really does have to be thorough preparation over the next six months.
I am certain that with the cooperation of all stakeholders, including nursing trade unions and private hospital groups, we should be able to address these challenges in time for the introduction of community service next year. The Nursing Council is fully involved in the planning process and has joined the Department in setting up a consultative forum. The forum will look into the distribution of community service nurses, conditions of service, adequate mentoring arrangements and the legal foundation for the process.
In my speech I link the introduction of community service with the Nursing Bill. But I should mention that there is an alternative, interim route if the Nursing Bill is not passed in time. And that would be to pass a small amendment to the existing law.
Finally on this subject, I would like to point repeat that community service has brought enormous benefits to areas that have lacked professional health services. Since we began this programme in 1999, about 11 000 new graduates have done community service. In many areas they have alleviated severe staffing shortages. Many have persevered in difficult working conditions and I really wish to recognise their work. I would also like to indicate that we are working with the provinces to improve the conditions of work for community service professionals. And, of course, those who work in rural areas are eligible for the rural allowances that were introduced from July last year.
Comprehensive Plan for Management, Care and Treatment of HIV and AIDS
The major part of our work of this financial year is the continued implementation of all the elements of the Comprehensive Plan. This includes emphasising the centrality of prevention in response to HIV and AIDS, strengthening of the national health system that should be able to provide continuum of care and sustain a series of interventions aimed at mitigating the impact of the disease. Provision of nutritional support particularly to those who are food insecure and promoting research and development of traditional medicine are some of the areas that are going receive much attention in terms of resource allocation.
As we began the implementation of the Plan, I requested the Medicine Control Council to fast track the registration of all medicines for AIDS related treatment including those for treatment of opportunistic infections. XXX (number) have since been registered through this fast track process. The MCC is meeting again on 02 July to finalise registration of XXX (number) that have been submitted for registration.
The process of finalising the tender for a long-term supply of antiretroviral drug to support the Comprehensive Plan for Management, Care and Treatment of HIV and AIDS is underway. We had about 40 companies that expressed interest in supplying these drugs. We short-listed them to 10 companies. We have already interviewed these companies and we are left with eight (8) suppliers that should receive request for quotations soon. These suppliers include both research based and generic companies.
The suppliers will have two weeks within which to submit their quotations. The prices will be discussed with Department of Health and tender should be awarded by the end of August. This process has taken longer than we expected. However, this has been necessary for us to achieve our main objective, which is a sustainable supply of ARVs at the best possible prices.
The interim measure through which ARV are current being supplied to provinces will continue until the main tender has been awarded. The challenges with regard to supply of drugs through this measure have to a great extent been resolved as we pass through the lead times needed to procure ARV's including paediatric version of these drugs. Provinces can therefore scale up their uptake of patients depending on the demand for treatment.
This year's Health Vote also provides for a major increase in conditional grant funding for the HIV and AIDS Programme. The allocation increases from R333-million in 2003/04 to R781-million in 2004/05. These funds are to be used to finance all the element of the Comprehensive Plan. Please note that these funds do not include substantial amount of resource allocated through equitable share to provinces to deal with burden of diseases in our facilities.
Medicines legislation
In my address I intend to highlight the policy of objectives of the Medicines and Related Substances Amendment Act and its regulations-namely to ensure that medicines become more affordable to South Africans and that they are more safely and effectively used.
On the issue of licensing of dispensing health professionals, let me say categorically that the intention of this policy is to ensure that health professionals who dispense are competent to do so and adhere to minimum standards of practice. This is why we have put in place a licensing system that requires every health professional who wishes to dispense to undergo training in order to be eligible for a licence.
Certain prominent members of the medical profession have stated that the training requirement is an insult to doctors. But the information that we have received from institutions providing the training is that some doctors who have been dispensing for years have failed the course by a wide margin. Clearly there is a need for specific training and dispensing is not something that is simply picked up on job.
You are aware that an organisation that calls itself the Affordable Medicines Trust has challenged the constitutionality of the licensing provision in the High Court. The matter has been heard and judgment is to be given on July 2. We are urging health professionals not to gamble with the care of patients and to complete the licensing requirements before that date. If the court rules that the provision is constitutional, it will come into effect immediately and any health professional who dispenses without a licence from that point onward will be acting unlawfully.
Let me turn now to the issue of transparency in medicine pricing. Our research indicates that large profits are being made on the sale of medicines. Indeed, it is widely admitted that medicine prices are often higher in South Africa than in many developed countries. What is bitterly disputed is who benefits from unjustifiable profit margins. Permit me to explain why the issue has been so clouded that every party in the supply chain could safely point fingers at the rest:
Until recently manufacturers charged different prices to different customers, using a complicated system of rebates, discounts and other incentives. Some companies did this to a much greater extent than others. As a result it was very hard to know the price of a drug as it left the factory gate.
Wholesalers and distributors added their mark-ups to the manufacturer's price and retailers then added their mark-up. These amounts were totally unregulated. The consumer knew that the price of medicines differed hugely depending on which pharmacy you went to. But nobody could say for sure who was taking excessive profits.
The medicines pricing regulations have tackled the challenge of reasonable pricing in a number of ways.
* They have scrapped and outlawed all discounts, rebates and other incentives
* They require manufacturers to set a single exit price for each product and to sell to all their customers at that price. The level of the single exit price is regulated through a prescribed formula
* They regulate the wholesalers' and distributors' fee indirectly by incorporating it into the single exit price
* They set a maximum dispensing fee for pharmacists and other health professionals who dispense medicines.
Some of these provisions - namely, those relating to dispensing and distribution fees -- are being challenged in court. But the single exit price is already in operation and has not been affected by the application that is currently being heard in the High Court here in Cape Town.
The Department has received 22 lists of single exit prices from various manufacturers and importers. We are currently analysing the impact of this provision on prices. Business Day recently quoted an analyst who suggested that prices of medicines have dropped by 16% to date. We should soon be in a position to give our own assessment. What I must point out is that the basis for calculating the single exit price will change early in 2004, when we will require companies to benchmark against an international average price for each product.
I would prefer to steer clear of the issues involved in the Cape High Court action, as we will be arguing before a full Bench today and tomorrow. Unlike some of the applicants, we do have respect for the sub-judice rules and we do not go about cynically disguising ourselves as consumers in order to argue our case through expensive adverts in the national press.
Cooperation with the Private Health Sector
As we begin this term of office, we are putting more emphasis on cooperation with all stakeholders to achieve the goal of better health for all. To improve interaction between public and private sectors, we have agreed with the private health sector that we need to develop a Health Charter. The Department of Health is drafting the framework for this Charter and we should be able to meet with other stakeholders to discuss the details of Charter by the end of July. The Charter will also lay out the core values that the private health sector should seek to uphold, including the ownership of private health services, Black economic empowerment and how the public and private sectors should cooperate and complement each other.
The role of local government
I will be referring this afternoon to the need for the national health Department to increase its support not only to provinces but also to local government. As you are aware, the National Health Bill envisages that local government will play a significant role in the delivery of primary health care services in the future.
The process will be phased in. Some functions are directly devolved to local government through various laws, while other functions will be contractually decentralised to the local sphere. The first step in this process occurs in July when environmental health services become a responsibility of metropolitan and district councils. We regard this as a positive measure and we believe that environmental health can be tackled very effectively by the authority that coordinates local development plans and the provision of essential services.
The practical implications - in terms of resources and personnel transfers - differ from province to province, and even from district to district. Our real concern is to ensure that the restructuring does not cause any disruption in services and that any difficulties that may crop up are flexibly dealt with by the relevant parties in a spirit of co-operative governance.
As I mentioned earlier, this session has been facilitated to allow the media to get more information and engage on some of the main issues contained in the budget speech. I would therefore like to end here and allow for questions that might which, I am sure; the health team that is gathered here will be able to attend to.
Thank you
Issued by: Ministry of Health
17 June 2004
Advertisement
EMAIL THIS ARTICLE SAVE THIS ARTICLE FEEDBACK
To subscribe email subscriptions@creamermedia.co.za or click here
To advertise email advertising@creamermedia.co.za or click here
