Cablegate: South Africa Public Health March 4 Issue

This record is a partial extract of the original cable. The full text of the original cable is not available.




E.O. 12958: N/A


1. Summary. Every two weeks, USEmbassy Pretoria publishes a
public health newsletter highlighting South African health
issues based on press reports and studies of South African
researchers. Comments and analysis do not necessarily reflect
the opinion of the U.S. Government. Topics of this week's
newsletter cover: Health funding increases 12 percent in 2005
Budget; HIV spending increases by 30 percent; provincial health
care spending up; Budget 2005's emphasis for poor; MRC study
highlights AIDS impact on South African deaths; Stats SA
releases mortality report; absenteeism costs South Africa R12
Billion; FDA approves South African HIV/AIDS testing
technology; Heart disease spreading in South Africa; Health
Department ready to issue bids for AIDS drugs; and SANBS
unveils new testing methods. End Summary.

Health Funding Increases 12 Percent in 2005 Budget; HIV
Spending Increases by 30 Percent
--------------------------------------------- ----------

2. Consolidated national and provincial spending on health for
fiscal year 2005/06 (beginning April 1) will reach R 48 billion
($8.3 billion using 5.8 rands per dollar) compared to R42.5
billion for FY2004/05, a 12.2 percent increase. The Treasury
Department puts the total budget for fighting AIDS during the
next fiscal year at R4.3 billion ($740 million), a rise of
about a billion rand over current spending and roughly six
times South Africa's FY05 allocation from the President's
Emergency Plan for AIDS Relief. The National Treasury has
allocated HIV/AIDS funds to three social sector departments:
Health, Education, and Social Development. The increase
conforms to medium-term expenditure framework projections, and
is planned to rise to R5.2 million by the 2007/08 financial
year. R1.8-billion of this year's amount is earmarked as
conditional grants to the provinces in the fields of health,
social development (which includes a R60 million increase in
home-based care, to about R139 million) and education. The
education component includes a R137 million allocation for life-
skills programs. The Health Department faces several key
challenges: services, particularly for primary health care;
programs for maternal and child health need expansion;
infectious disease, chronic diseases and trauma need
improvement; and quality of care also needs to be improved. A
total of R3.4 billion has been set aside for rehabilitating 59
hospitals over the next three years. Seventy seven percent of
the Health Department's HIV/AIDS budget will be sent to
provinces through conditional grants. The remainder of the
budget will be spent and transferred by the Department to non-
profit institutions. In real terms, the total Health HIV/AIDS
budget has grown by 18 percent in 2005/06, from R1.2 billion in
2004/05 to R1.5 billion in 2005/06. Source: Sapa, February
24; IDASA HIV and AIDS Allocations: A First Look at Budget
2005, February 25.

3. Comment. The budget speech by Trevor Manuel, Finance
Minister made no mention of HIV/AIDS problems facing South
Africa. Health Minister Tshabalala-Msimang cited TB, HIV/AIDS,
diabetes, hypertension and cancer as the main health challenges
facing South Africa and the Department plans to promote health
promotion campaigns focusing on the major factors underlying
the high burden of these diseases along with promotion of
healthy lifestyles. During a press briefing on February 18,
the Health Minister said the department did not have reliable
figures as to how many people were on ARV treatment or how many
had dropped out. In several recent press interviews, Dr.
Nomonde Xundu, the new Chief Director for the HIV and AIDS, TB
and STI's Department of Health cluster, also refused to discuss
actual targets or numbers of people on treatment. Provincial
government statistics collected by the AIDS Law Project shows
23,000 patients on anti retroviral treatment nationally, short
of the government's goal of 53,000 patients by the end of March
2005 and the Treasury Department's Estimates of National
Expenditure 2005 mention that 28,786 people are on ARV
treatment. Budget 2005 makes no direct resource allocation
specifically for the ARV treatment program. Budget 2004
estimated that R600 million will be spent on the ARV program in
2005/06, but Budget 2005 has not indicated if this estimate is
still operative and how it would be adjusted to meet increased
need and demand for treatment. End comment.

Provincial Health Care Spending Up

4. Consolidated provincial health expenditure is budgeted at
R45.8 billion ($7.8 billion), rising to R49.9 billion in
2006/07 and R53.5 billion by 2007/08. A detailed provincial
breakdown will be available in the intergovernmental fiscal
review, released after the Budget Review, but Mark Bletcher,
Treasury's Health Director indicated that significantly more
money for health would be available for Limpopo and KwaZulu
Natal provinces. An additional R600 million is allocated to
the national Health Department over the next three years to
improve its management of the hospital revitalization program,
which is funded through conditional grants. (Conditional
grants are funds that must be spent on a designated purpose.)
Source: Business Day, February 24.

Budget 2005's Emphasis for Poor

5. A priority over the decade ahead will be to ensure that a
caring and competently managed health service is available in
every community, Finance minister Trevor Manuel told Parliament
during his presentation of the 2005 budget. A large portion of
the Budget was allocated to government expenditure and tax
changes designed to benefit the poor. Tax changes to medical
scheme contributions, more money for primary health care and
tertiary hospitals, increases in taxes of tobacco and alcohol
products are some of the varied highlights in Budget 2005.
Manuel announced a change to the tax treatment of medical
scheme contributions, which will have the effect of reducing
the cost of medical scheme membership to lower income families.
The present allowance for two-thirds of a medical scheme
contribution to be paid tax-free will be replaced by a capped
tax deduction, having the effect of limiting the tax loss
associated with more expensive medical scheme options, while
increasing its monetary benefit to lower income taxpayers,
thereby enabling more people to afford medical aid. These
changes will take effect in 2006: (1) the Budget makes
available funds to enable provinces to fulfill their
responsibility for primary health services formerly provided by
non-metropolitan municipalities, and an additional R180 million
a year for tertiary health services; (2) Old age, disability
and care dependency grants will increase by R40, to 780 per
month, foster care grants by R30 to R560 per month and child
support grants by R10 to R180 per month; (3) the Budget also
provides for improved salaries for social workers; (4) the
Budget allocates R2 billion and R1.7 billion to municipal and
sanitation infrastructure in the comprehensive housing
strategy. As in previous years, taxes on alcohol and tobacco
were increased, raising R1.6 billion in additional revenue. In
keeping with these health-related fiscal measures, Manuel
announced the abolishment of excise duties on sun protection
products at a cost of R10 million a year. Source: Health E
News, March 1.

MRC Study Highlights AIDS Impact on South African Deaths
--------------------------------------------- -----------

6. "Identifying deaths from AIDS in South Africa", published
in the journal AIDS by Medical Research Council (MRC) and
University of Cape Town (UCT) researchers, confirms that there
has been a massive increase in AIDS deaths in South Africa.
The researchers found that 61 percent of the estimated 153,000
AIDS deaths in 2000 were misclassified, described instead as
deaths due to TB, pneumonia or meningitis. The researchers
compared the 1996 and 2000 death rates for 22 conditions and
found that death rates for nine of them rose in tandem with
recorded AIDS deaths, showing the same distinct age and gender
pattern. The nine conditions were TB, pneumonia, other
respiratory diseases, diarrhea, meningitis, gastroenteritis,
other infectious and parasitic diseases, deficiency anemia and
protein malnutrition. There was a disproportionate number of
deaths among young children, sexually active young men and
women, with the peak death rate for women (30-34) coning about
five years before the peak for men (35-39). The study shows
that HIV had become the largest cause of death in women by 2001
and that a pattern of mortality had emerged in which young
adults (aged 15-49) were dying in increasingly large numbers
relative to the rest of the population. MRC and UCT released
this study before Statistics SA released its mortality report.
Source: Business Day and Financial Mail, February 1; Health E-
News, February 22; Sunday Times, February 27.

STATS SA Releases Mortality Report
7. Statistics SA released "Mortality and Causes of Death in
South Africa", a study of approximately 3 million death
notification forms received by the Department of Home Affairs
between 1997 and 2002, and noted that South African adult death
rate increased by 62 percent over the five-year period, from
272,221 in 1997 to 441,029 in 2002. Tuberculosis, influenza,
pneumonia and strokes are the leading causes of death. Pali
Lehohla, Stats SA's chief, said that the data provided indirect
evidence that the HIV epidemic is raising the mortality levels
of adults, but that the death notification forms did not allow
one to determine HIV infection or AIDS-related mortality. The
report also found that the proportion of deaths in the age
group 20 to 49 was increasing and the proportion of deaths of
females was increasing relative to the total. HIV dropped in
the ranks of the underlying causes of death when comparing 1999
to 2001, a period in which deaths from TB and influenza
increased by more than 50 percent. In 1997, TB accounted for
25,640 deaths, rising to 56,985 in 2001. Influenza and
pneumonia deaths rose from 24,698 to 55,115 during the same
period. Deaths specifically attributed on death notification
forms to HIV fell by 10 percent to 9,000, pushing HIV out of
the top 10 causes of death in 2001. Representatives from Stats
SA acknowledge that analyzing death notification forms does not
give a true reflection of HIV fatalities given that most HIV
deaths are due to other opportunistic infections. David
Bourne, an epidemiologist with the University of Cape Town,
noted that the HIV status of the deceased must be known if
accurate HIV death statistics can be discovered from death
notification forms, which is almost impossible given the vast
majority of South Africans not able to afford private health
care. In addition, he stated that HIV deaths are severely
undercounted for reasons of confidentiality and prevention of
stigmatization. He argued that the Stats SA analysis
demonstrates the high costs of AIDS in South Africa and that
the debate should feature delivery of health interventions
rather than the statistics. Source: Sunday Times, February 20
and 27; Sunday Independent, February 20; Business Day, February
21; Health Systems Trust News, February 23.

Absenteeism Costs South Africa R12 Billion

8. According to a study commissioned by AIC Insurance,
absenteeism costs South Africa R12 billion per year, of which
roughly R1.8 to R2.2 billion can be attributed to the effects
of HIV/AIDS. Companies were losing as much as a month's work
each year for each employee with advanced HIV/AIDS. The study
showed that the absenteeism rate for people living with
HIV/AIDS was three times higher than that of people not
infected with the virus. People with HIV/AIDS were absent 32
days per year on average. The data are predominantly from 60
companies in the motor and textile manufacturing industry in
the Eastern Cape. Source: Business Report, February 9.

FDA Approves South African HIV/AIDS Testing Technology
--------------------------------------------- ---------

9. The U.S. Food and Drug Administration approved a South
African AIDS technology that reduces the cost of monitoring
immune levels in AIDS patients. Dr. Deborah Glencross
developed a new approach to CD4 testing that provides a 70-80
percent cost savings over the traditional HIV testing methods.
Glencross developed a simpler method of counting CD4 cells,
called "PanLeucogating" or "PLG CD4" test, which reduces the
number of steps involved in counting CD4 cells and is accurate
on blood samples up to five days old. The PLG CD4 test uses
the white cell count as the reference point, a parameter that
is generally stable. Traditionally, CD4 cells are referenced
to total lymphocytes, a subset of white cells, which is
notoriously unreliable and several additional tests are needed
for quality control, adding substantially to costs. The PLG
CD4 needs one quality control test, compared to up to five
tests required by the conventional CD4 testing methods.
Beckman Coulter, an international biomedical testing system
manufacturer, obtained the exclusive license for the technology
and arranged the process for FDA approval. Source: Sunday
Independent, February 13.

Heart Disease Spreading in South Africa

10. The Medical Research Council (MRC) is finalizing two
research proposals that would identify and manage risks of
heart disease among South Africans. The first is a three-to-
six month study testing the feasibility of evaluating risk
factors for heart disease among black, coloured and Indian
South Africans. The second proposal would look at a much
larger sample over a longer period of time (three years).
South Africa has had one of the highest incidences of heart
disease among the Indian population in the 1970s and 1980s,
among coloureds during the 1980s and 90s and now heart disease
is growing in importance among black South Africans. During
2000, 12 percent of the 500,000 deaths in South Africa were
from heart disease. Another 8 percent of deaths were caused by
strokes. Approximately 25 percent of the South African
population suffers from hypertension and about 20 percent is
obese. Ten years ago, estimates of the cost of heart treatment
on the economy were R4 billion per year; recent estimates reach
R10 billion per year. At Chris Hani-Baragwanath Hospital in
Johannesburg, over half of the patients experiencing heart
attacks are black. Source: Pretoria News, February 17.

Health Department Ready to Issue Bids for AIDS Drugs
--------------------------------------------- -------

11. Health Minister Manto Tshabalala-Msimang announced that
the government completed its negotiations with drug companies
to supply anti-retroviral drugs in state hospitals and will
issue tenders shortly. Facing the world's biggest HIV caseload
with more than five million people infected with the virus that
causes AIDS, South Africa launched a program in late 2003 to
provide life-prolonging anti-retrovirals free to the public.
But the state tender for the drugs has long been delayed and
the government has been criticized for dragging its feet in
rolling out the program. Tshabalala-Msimang said lack of
capacity and infrastructure in the public health care system
had stalled distribution of interim drug supplies. The bid,
initially expected to be granted in August 2004, would be
awarded shortly. The government last year short-listed eight
drug companies to supply the medicines. Source: Business Day,
February 18.

12. Comment. A February 1 article in Financial Mail suggests
that the main reason for the bid delays lies in application of
the Department of Trade and Industry's (DTI) regulations that
state that any government or parastatal contract with an
imported content of $10 million or more is subject to the
National Industrial Participation (NIP) program, which requires
a thirty percent reinvestment back into South Africa.
Provincial health departments have been bypassing the state
tender process and procured AIDS drugs directly from
pharmaceutical companies on short-term contracts. The drug bid
is different from most state bids, where the government is
negotiating prices with the short-listed firms instead of the
companies submitting closed bids. No additional comments were
forthcoming from the Department of Health regarding the
application of the NIP program's reinvestment regulations on
the drug bid. End comment.

SANBS Unveils New Testing Methods

13. The new method of testing whether donated blood is safe
will be based on whether a donor has a transmissible infection,
and not on race, according to the Department of Health. Based
on the goal of keeping blood supplies as safe as possible, the
first-time donor will donate for the purpose of screening for
transmissible diseases. The plasma will be quarantined and
only issued after the donor has donated for a second time and
is shown to be free of infectious diseases. Disease-free blood
after a third donation places a donor in a low risk category.
Those who have donated more than seven units of blood in the
previous 24 months are regarded as very low risk and their
donations can be used for all types of treatment. Blood from
all the three risk groups will be tested for diseases after
every donation. In addition, a Nucleic Acid Technology (NAT)
screening of all donations will be introduced which reduces the
current window period in the transfusion service. On average,
in the low-risk group, zero to nine donations per 100,000
tested positive for HIV; in the high-risk group, between 200
and 3,000 donations per 100,000 tested positive. The new model
was developed after it became publicly known that blood
donations from black people were treated as high risk based on
HIV/AIDS prevalence statistics. Health Minister Manto
Tshabalala-Msimang ordered the South African National Blood

Service (SANBS) find another way of making sure blood was safe
and a committee consisting of representatives of both parties
was given until the end of January to find an alternative. The
new model will be implemented within six months. Source:
Sapa, February 15; The Star, February 16.


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