Outsourcing costs National Lab R18m a month

HEALTH Minister Aaron Motsoaledi said building the capacity of the National Health Laboratory Services (NHLS) in terms of staff and equipment was more cost-effective than outsourcing tests to private laboratories.

- MAYIBONGWE MAQHINA

Motsoaledi said while it was financially advantageous for the NHLS to in-source, such a move required sufficient budget and cash flow to compete with the higher salaries of private laboratories and high-cost equipment.

"This requires additional funding either through increased fees or an allocation from the National Treasury," he said.

Motsoaledi was responding to parliamentary questions by DA MP Michele Clarke about the NHLS partnering with private sector company, PathCare, to tackle the delays in cancer testing at its Johannesburg facility.

According to Motsoaledi, the provincial Health departments are under severe financial strain.

"So an additional increase in fees will not be accepted by provinces and is likely to result in accruals. The National Treasury has been reducing health budgets and has not been accepting bids for budget increases," he said.

The minister also said the strategy was to incrementally direct surplus funds towards equipment and staff salaries.

"The use of private laboratories will then be scaled down and reserved only for exceptional surge scenarios once NHLS staffing levels are back to full strength," said Motsoaledi.