Netcare litigation won’t slow health inquiry

Netcare litigation won’t slow health inquiry

A process to secure a replacement for KPMG in the Competition Commission’s inquiry into private health care costs is well under way following a Netcare court case, according to the inquiry’s chair former Chief Justice Sandile Ngcobo.

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The UK concluded a similar private health care inquiry in 2013 that found that some private hospitals faced little competition. One of the groups owned in part by Netcare may be forced to sell some hospitals, according to Section27

In early 2014, KPMG released a statement confirming Netcare Hospitals had taken it and the Competition Commission to court just days after KPMG’s appointment as a technical service provider for the commission’s Market Inquiry into the Private Health Care Sector. Netcare alleges that KPMG’s appointment is a conflict of interest given the firm’s prior consultant work for the hospital group. KPMG has denied the allegations and litigation remains on going.

To avoid unnecessary delays in the inquiry, the commission has begun identifying replacements for KPMG, said Ngcobo speaking at a Johannesburg press conference yesterday.

According to Ngcobo, public hearings as part of the inquiry will begin in March 2015 in Pretoria, however further cities may be added at the public’s request.

Spurred by concerns regarding private healthcare pricing, the inquiry will evaluate private healthcare competition. Led by a five-person panel including Ngcobo, the inquiry will examine issues like price increases, fee parity among medical aid users and those paying out of pocket and hospitals’ influence on the demand for health goods and services.

Almost one in five South Africans use the private healthcare sector, according to statistics cited by the public interest non-profit, Section27. Between 2000 and 2010, the increase in spending on private hospitals grew by more than double headline inflation.

The inquiry is also expected to examine the pharmaceutical and medical devices markets to a lesser extent before ultimately making recommendations regarding the private health sector, or related legislation and policy. The body can also choose to conduct further investigations or initiate a complaint against a company to a higher authority, specifically the Competition Tribunal.

Health care confidential 

Companies and the public can submit information to the inquiry, but the body can also subpoena information.

Many are hoping the inquiry will provide never before seen information on the inner workings of private health care but there are fears that private companies may use sections of the Competition Act to argue information presented to the panel is confidential and may not be made public.

“When (companies) provide information to us, they will have to indicate as t whether or not any part of that information is a of a nature that is confidential,” Ngcobo told Health-e. “However, we – as a panel – have the responsibility to not merely accept those statements as fact and we need to be satisfied ourselves that that information is indeed confidential.”

“If we are not satisfied, we will refer that to the Competition Tribunal,” said Ngcobo, adding that draft documents outlining the timeframe and procedures for the inquiry’s work should be made available for public comment by 31 May.

Key dates announced, subject to change:

31 May 2014 Draft documents outing the inquiry timeline, procedures and “statement of issues” released for public comment. The “statement of issues” frames the market investigation by indicating the central issues in the inquiry
June 2014 Public comment period for released documents
1 August 2014 Final timelines, procedures and statement of issues released
1 March to end April 2015 Public hearings held in Pretoria and possibly other cities. Interpreters will be made available to the public
May 2015 Panel reviews and analysizes information, may make targeted requests for additional information