Sakeliga, a South African business advocacy group, has lodged formal objections to the Draft Interim Block Exemption for Tariffs Determination in the Healthcare Sector, gazetted on February 14, 2025 by Minister Parks Tau.

The government frames this as a seamless bridge to the National Health Insurance (NHI) framework under section 10(10) of the Competition Act, 1998, exempting agreements on tariffs, codes, and quality metrics from sections 4(1)(a), 4(1)(b)(i), and 5(1).

In practice, it vests the Department of Health with authority to fix maximum tariffs for private healthcare services, a move Sakeliga deems overt price control. Price controls are widely regarded as an extremely dangerous and foolish economic policy in any sector, let alone a vital sector like healthcare.

Sakeliga contends that this "a clear attempt to start introducing NHI via ancillary regulatory mechanisms", per executive director Russel Lamberti. He contends that the unbudgeted NHI plan, in context of the current looming fiscal cliff, and the splits in the ruling coalition over national budget, is unwise, and potentially catastrophic: "As the fiscal noose tightens and tolerance for more tax hits the wall, the magnitude of the NHI's impossibility becomes clear. But this doesn't mean the state will give up trying to break healthcare. Allowing the NHI to anchor healthcare negotiations is a losing game."

The regulations establish a Tariffs Governing Body (TGB), led by a Chief Tariffs Manager appointed by the Director-General of Health, and a Multilateral Negotiating Forum (MLNF) with representatives from government, practitioners, funders, and regulators like the Council for Medical Schemes (CMS). The TGB sets guidelines and assesses costs, while the MLNF proposes tariffs for Prescribed Minimum Benefits (PMBs) and non-PMBs, validated by the CMS and published for transparency. Exclusions cover collusive practices, medicine tariffs, and specific practice codes (47, 49, 55-59, 76-79), leaving them to bilateral talks.

Sakeliga contends this stifles healthcare providers’ ability to negotiate rates with hospitals and medical schemes, disregarding expertise or circumstance. Specialists and rural practitioners, facing elevated costs, stand to suffer most. Unable to cover expenses, some may shutter practices, downgrade care, or exit the sector. The group warns of an exodus—retirements, emigration—exacerbating shortages, lengthening queues, and eroding care quality. Far from reducing costs, scarcer services could drive up prices for quality healthcare.

The exemption, effective for three years from February 14, 2025, with extension possible, mandates quarterly reporting to the Competition Commission and others. Comments closed March 31; as of April 4, its fate is undecided. The Health Funders Association sees transparency gains, but the Democratic Alliance flags parliamentary overreach. Sakeliga deems the draft irredeemably flawed, demanding its withdrawal and pledging to resist both it and the NHI Act’s rollout. Efficacy remains untested, but scrutiny is sharp.

They encourage businesses to sign up and support their efforts to block these regulations at their website.

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