A nation’s ability to generate sustainable economic growth and thrive is inherently linked to the health of its population. Alongside skills and education, a country must invest in the physical and mental well-being of its workforce to facilitate meaningful socioeconomic development.
The International Labour Organisation (ILO) has identified a two-way link between productivity and well-being. It states in a working paper that the gains made from interventions aimed at improving the well-being of a population, in turn, generate greater income and government revenues that can boost well-being. This means that “productivity growth and improvements in well-being are closely interconnected and can create positive, mutually reinforcing feedback loops”.
Conversely, absenteeism due to sickness and injury has been identified by researchers as potentially the single most expensive issue impacting business, with estimates suggesting that South African companies are losing up to 17% of their payroll each year due to absenteeism.
Occupational Care South Africa (OCSA) has found that absenteeism costs the country’s economy a staggering R16-billion/year, while the Capital Review puts this figure at an even higher estimate of more than R19-billion annually. This equates to about 15% of employees being absent on any given day.
Inevitably, absenteeism also affects other employees in the workplace who may have to make up for the work not performed by absent employees, which also lowers overall productivity. This also impacts the productivity of managers who must spend time adjusting workflows to keep things moving.
Many employees who do not have access to quality healthcare often do not seek treatment for minor ailments. This is especially the case in workplace environments where there is a fear of a loss of employment or in jobs where there is no protected time off. However, delaying treatment for an ailment or health condition can lead to more serious health problems, driving up the cost of absenteeism in the long run. When left untreated, disease progression could see a mild ailment developing into a serious illness or even a medical emergency, resulting in an employee staying off work for longer periods.
No medical insurance
SAFacts puts the target for absenteeism rate due to illness at 1.5% for any business (three to four days per year). Yet, South African companies’ average absenteeism rate is between 3.5% and 6%, which equates to between eight and 15 days per worker per annum.
Given the significant impact of illness and absenteeism on work and economic development, the issues of public health and productivity are addressed by UN Sustainable Development Goal 3 – “Good health and well-being: ensure healthy lives and promote well-being for all at all ages” – and Goal 8 – “Decent work and economic growth: promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all”. Our social insurance and stakeholder brand strategy at Rand Mutual Assurance (RMA) prioritises productive multi-stakeholder partnerships that advance these two UN SDGs, among others.
While South Africa’s constitution promises everyone the right to healthcare, close to 85% of the nation’s 62 million people have no medical insurance and rely on an overburdened public system with too few doctors, which often results in delayed or inadequate treatment.
According to the National HealthCare Group, a lack of access to healthcare coverage has harmed productivity in South Africa, which is affecting the profitability and ultimately the sustainability of businesses and job security of workers, as well as negatively contributing to the country’s economy.
The healthcare service provider earlier this year noted that the employed but medically uninsured market in South Africa is now estimated at 5.5 million people, with affordability in many ways becoming an impenetrable barrier to accessing quality healthcare services.
On the other hand, many employees who do have medical aid typically exhaust their day-to-day benefits halfway through the year and are left with unaffordable co-payments. This means that many are forced to delay needed procedures and treatments to the next financial year because they cannot afford to pay the excessive charges set by private service providers.
At this stage, South Africa does not offer quality universal healthcare, but rather two separate public and private healthcare systems that both struggle to provide access to affordable and quality care to the country’s population.
More than 84% of the public, mostly the working class, depend on public healthcare. The state-funded public healthcare system has over 400 hospitals and clinics, but it still suffers from a significant lack of resources, including critical staff vacancies, long queues and shortages of medication. Patients are largely frustrated by the service they receive at the hands of an over-extended and strained public health system lacking adequate funding, personnel and maintenance of facilities.
While the public health system is funded by taxation, South Africa is grappling with an official unemployment rate of 32.1%, or 7.9 million people, as of the fourth quarter of 2023, and an expanded unemployment rate of 11.7 million. This is the number of working-age people who rely on the public healthcare system yet are unable to contribute to its funding.
Further strain is being placed on the already over-stretched public healthcare system by a rapidly growing population, with South Africa’s current population of 62 million expected to grow by 4.9 million between now and 2029, according to Statista. Migration is placing an additional strain on the public healthcare system, with an estimated 2.9 million migrants residing in South Africa in mid-year 2020. By law, migrants are afforded access to healthcare in the country.
Given these factors, South Africa needs to urgently develop a sustainable and universal healthcare system. While the country spends a significant amount collectively on healthcare a year, combining these private and public resources into one pot would ensure a universally accessible and sustainable healthcare system for all citizens.
Successful implementation
Similarly, by combining personnel and infrastructure resources, South Africa could establish a system where critical vacancies are filled and an equal distribution of patients to public and private healthcare facilities is achieved, without compromising the quality of care. RMA, a leading social insurer with 130 years of best-of-breed administration capabilities, is part of a network of world-class organisations with the capacity to contribute to the successful implementation of the proposed universal access healthcare system.
At the same time, central to developing a functional and universally accessible healthcare system is the building of new healthcare facilities by both the private and public sectors and higher levels of maintenance of existing infrastructure.
Instead of being seen as an economic risk, South Africans should consider a universal healthcare system as an investment in human development which will enable the country to achieve greater socioeconomic development. The large-scale reform of South Africa’s healthcare system will not be possible without strong leadership and robust political and social commitment. Ultimately, as a country, we should not be asking whether we can afford to implement a universal healthcare system, but rather whether we can afford not to.
- The author, Mandla Shezi, is group CEO, Rand Mutual Assurance
- This promoted content was paid for by the party concerned