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Friday, December 1, 2006
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South Africa’s social environment and persistent economic inequity is in dire need of redress, no more so than in the healthcare sector. While there are plans for a social health structure, Alan Fritz, general manager of corporate affairs at BESTmed, says the industry still has a long way to go.

“It is ironic that companies and organisations at the heart of the healthcare industry continue to lag behind in transformation. But they need to realise that if transformation is carried out properly and successfully, it will gain a lot of added value from the process,” says Mr Fritz.
He points out that income distribution is still skewed by race to the extent that previously disadvantaged individuals (PDIs), who constitute 78,7% of the population, earn only 46,7% of total income. This, he says, is a recipe for more legislation. “Unemployment is also skewed: 48,8% of PDIs are unemployed; and this tells you that the haves will have to fund the have-nots in the healthcare sector. The immediate consequence of poverty is huge inequalities in access to healthcare, productive assets, land, basic infrastructure, education, and skills.
“The government is not going to sit back and do nothing. I predict that the Council for Medical Schemes will have to manage schemes more strictly in its role as a watchdog for an industry seemingly unable to transform itself,” he continues.
“Strategic alignments should be managed beyond mere fronting. Business strategies will fail if they do not build value. This will require careful attention to people management, business culture, and organisational processes.
“The healthcare industry must accept that there can be no half measures if we want to survive in an economic environment that will largely be influenced by the emerging market,” Mr Fritz adds.
Job creation in South Africa is increasing, and he says the positive spin-offs will be felt in healthcare as long as there is compliance with Broad-Based Black Economic Empowerment imperatives. “The emerging market up until 1970 saw whites receive more than 50% of fiscal expenditure. In 1997 this figure dropped to 9%, which shows a fundamental shift that must be taken into account. The change in spending patterns and the accumulation of wealth in today’s emerging market makes this group attractive to the healthcare industry, and to take advantage of this market the sector’s leadership must take the initiative to develop more skilled professionals from previously disadvantaged groups. There can be no benefiting from change in an industry which is not prepared to change itself.”

Copyright © Insurance Times and Investments® Vol:19.6 1st December, 2006
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