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National Health Act, 2003 (Act No. 61 of 2003)


National Health Insurance Policy towards Universal Health Coverage

Chapter 8 : Purchasing of Health Services

8.4 Provider Payment Mechanisms


286. The existing provider payment mechanisms currently function within the budget and associated accountability. Under NHI the provider payment mechanisms must contribute to a responsive health system by incentivising improved quality in the public sector whilst they also making delivery of healthcare efficient, affordable and sustainable. As a strategic purchaser, the NHI Fund will pay providers in a way that creates appropriate incentives for efficiency and for the provision of quality and accessible care. NHI will pay a uniform reimbursement strategy and there will be no balanced or split billing under NHI.


287. The NHI Fund in consultation with the Minister will determine its own pricing and reimbursement mechanisms. Providers who wish to contract with the NHI Fund must comply with the stipulated pricing and reimbursement mechanisms.


288. Performance will be monitored and appropriate sanctions will be applied where there is deviation from contractual obligations. The contracts will also stipulate the reimbursement strategy that will be applied. Contracts will be reviewed on a regular basis taking into account health system priorities, epidemiological changes and provider performance. The performance of the contracted providers will be monitored and evaluated by the Performance Monitoring Unit of the NHI Fund.


289. The NHI Fund will use its various payment mechanisms to leverage the provision of efficient and quality services through linking provider payment to their performance and compliance with accreditation criteria. The reimbursement system will be regularly reviewed and refined taking into account implementation experiences and budget impact assessments.


8.4.1 Provider Payment at Primary Health Care Level

8.4.2 Provider Payment for ambulatory private specialist services

8.4.3 Provider payment at hospital level

8.4.4 Payment for Emergency medical services (EMS)