Study reveals 300% rise in Namibia’s private healthcare costs – Business Express

The private healthcare market in Namibia has experienced systemic cost increases of nearly 300% between 2005 and 2021, study on the Namibian Private Healthcare Sector has revealed.

Initiated by the Namibian Competition Commission (NaCC), the study was made possible through the funding of the United Nations Development Programme, and through the use of a consultant, Health Development Systems.

“In 2005, the average beneficiary on a medical scheme spent just over N$5 395.71 annually on all medical benefits in 2001 prices. By 2021 this has increased to around N$21 449.54 per year – a 298% increase in costs. The largest chunk of cost is seen in hospitals (35%), followed by pharmaceuticals (16%), and specialists (11%),” findings of the study show.

The study was born out of a need to better understand the dynamics and the workings of the Namibian Private Healthcare sector.

“Over the past years, the NaCC received several complaints in the private healthcare sector. These complaints raised concerns of anticompetitive practices which may impede competition and increase the cost of healthcare services. It was against this background, the Commissioners expressed the need for the Secretariat to conduct a study in order to understand the structure and provision of private healthcare in Namibian with a specific focus on analysing the cost trends over the years.

“A study into the provision of private healthcare would assess the state of competition as well as provide policy advice and competition guidelines that would promote fair competition amongst the different players in the sector,” Taimi Amunkete, Senior Researcher at NaCC said.

The study also found that the majority of Medical Aid Funds (MAFs) recorded significant profits over the years but it is currently unclear how it benefits the members.

“In terms of cost pull and push factors, the annual medical aid fund premium increases are not significantly determined by administration fees (as this is fairly constant and contributes minimally). They are mainly driven by other costs such as doctors’ costs, technology enhancements, over utilization, facilities, and medication (pharmacies).

“Competition analysis has indicated the funders industry is highly concentrated (two MAFs take up over 60% of the market) albeit with a marginal decline. The facilities market was found to be less concentrated,” results further show.