Big blow to NHI

The government’s National Health Insurance (NHI) scheme has been dealt a significant legal blow, with the court declaring certain provisions invalid and unconstitutional.

On 24 July 2024, the Pretoria High Court handed down judgment in trade union Solidarity’s case against the Minister of Health, the President, and the Health Department’s Director General.

The sections the court declared invalid relate to the legislation’s provision for a “Certificate of Need”, which the National Department of Health wants to adopt to exert more control over where doctors and medical professionals can practice in the country.

In its application for this case, Solidarity argued that the requirement of a certificate of need infringes unlawfully on the right of health practitioners to practise their profession.

Solidarity said that had these sections come into effect, it would have amounted to the expropriation, as it were, of health practitioners’ businesses and their property at the expense of both the practitioners and those who are currently using their services.

This reasoning was validated in the High Court, which ruled that sections 36 to 40 of the National Health Act (NHA), which gives the government power to determine where medical practitioners practise, are invalid and unconstitutional. 

In its judgement, the court declared that sections 36 to 40 of the NHA are invalid in their entirety and are consequently severed from the Act.

This conclusion was reached because the certificate of need regime was “objectively not rational,” gave the director general of health wide-reaching powers, and could lead to removing healthcare services from those who depend on them.

The judge said the ruling would need to be confirmed by the Constitutional Court and will, therefore, be filed with the Registrar of the Constitutional Court.

If the Constitutional Court confirms the ruling or parts of it, lawmakers typically have two years to amend the country’s laws to address the unconstitutionality.

Solidarity CEO Dirk Hermann said this ruling means parts of the NHI are likely illegal.

Legal experts at Werksmans previously explained that the NHA’s provisions for a certificate of need would ensure that no person may operate an existing health establishment, increase the number of beds in such an establishment, or construct or open a new health establishment without having one of these certificates.

“The definition of a health establishment is incredibly wide and would easily include almost any place where a health service is available, including pharmacies, a general practitioner’s consulting rooms and hospitals,” the firm said.

“Accordingly, the certificate provisions of the NHA have universal application to all places where health-related services may be obtained in the country.”

Solidarity launched a constitutional challenge against the certificate of need in December 2021. The following June, the court ruled in its favour, declaring relevant sections invalid and unconstitutional.

However, this decision was overturned when the Health Department successfully argued it had not been notified of the proceedings. The department had neither opposed the challenge nor participated in the case.

Subsequently, the matter was referred to the Constitutional Court, which, in December 2022, remitted it back to the lower courts. The case was reheard in March 2024, with the Health Department now involved.

Solidarity contends that the certificate of need unlawfully restricts healthcare practitioners’ right to practice. 

It argues that implementing these sections would have amounted to expropriating practitioners’ businesses and property, harming practitioners and patients.

Hermann explained that these provisions would have granted the government excessive control over medical practices, potentially leading to irresponsible use of power. He asserted that the government should not possess such authority.

In a press statement released after the judgement was handed down, Solidarity said the state’s goal with these sections was clearly to pave the way for the NHI and compensate for the bankruptcy of the state coffers.

“The government wants to change to a system in which health care is nationalised, and health care practitioners become servants of the state so that the provision of all health care can be centrally controlled by the state. This victory thwarts those disastrous plans,” said Hermann.

“In essence, these sections would have empowered the government to capture medical practices almost entirely and to manage them at will – rather than them being run at the discretion of the doctors.”

“We cannot simply hope that the government would simply always apply its wide discretions responsibly. A government should not have such powers at all.”

More blows to come

Solidarity’s challenge is not the only legal battle the government faces in its implementation of NHI.

The second-largest party in the Government of National Unity, the DA, has always staunchly opposed the ANC’s NHI plan.

When the Bill was signed into law earlier this year, the DA vowed to “challenge the ANC’s NHI all the way to the Constitutional Court”.

“Our legal team was briefed months ago already and will file our legal challenge against this devasting legislation without delay.”

DA leader John Steenhuisen added that the party will “not stop there”. 

“I furthermore pledge today before the nation that if this country elects the DA into national government on the 29th of May, we will immediately repeal the NHI Bill and prevent it from destroying this country,” he said.

Several other institutions have also threatened legal action against the government regarding the implementation of NHI.

Cas Coovadia, the CEO of Business Unity South Africa, said that, in response to the NHI becoming law, the organisation would consider its options, including legal action.