# Critical assessment of health financing indicators and expenditure in South Africa

## TL;DR

This study examines health financing in South Africa, finding that increased funding has not kept up with population growth and rising healthcare costs.

## Contribution

The study provides a qualitative analysis of health financing trends and pressures in South Africa.

## Key findings

- Real health budgets have increased but not matched population growth rates.
- Medical inflation and CPI show rising costs for medicines and consumables.
- Future healthcare funding needs will grow due to longer life expectancy and public service access.

## Abstract

Despite the increased funding and advancements in providing public health services, the health system continues to be challenged by the high prevalence of diseases.

The objective of this study is to review health sector financing in South Africa by highlighting causes for spending pressures in the health system. The study setting comprised the National Department of Health in Pretoria.

The study employs a qualitative approach by reviewing the literature on healthcare financing and expenditure in South Africa through the analysis of multiple electronic database searches to provide insight into trends and behaviour of health care budgets, expenditure, and health financing indicators.

Health financing indicators reveal that South Africa’s real health budgets have increased over the past years. However, the increase has barely kept pace with population growth rates. Also, the analysis of the consumer price index (CPI) and medical inflation shows that the costs for medicines and other consumables have, over time, remained significantly above the normal consumer inflation.

The rising trend in population growth and life expectancy rates suggests that health care funding will need to rise considerably in the next decade as individuals live longer and are anticipated to be given unrestricted access to public health services.

This study deepens the comprehension that, while reforms in the health sector and mobilisation of additional resources are essential for tackling disparities and access to health care, it is also crucial to examine and improve the efficiencies in the utilisation of these resources.