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This report is part of the SHIELD (Strategies for Health Insurance for Equity in Less Developed countries) project, which was initiated in 2006 and is funded by a grant from the European Commission under its Sixth Framework Program and a supplementary grant from IDRC.  The aim of SHIELD is to critically evaluate existing inequities in health care in Ghana, South Africa and Tanzania and the extent to which changes in health care financing mechanisms could address equity challenges. The first phase of SHIELD involved undertaking detailed financing incidence analyses (i.e. an evaluation of the distribution of the current health care financing burden between socio-economic groups relative to each group’s ability-to-pay) and benefit incidence analyses (i.e. an evaluation of the distribution of the benefits of using health services across socio-economic groups relative to each group’s need for health care) as a means of identifying existing health system inequities and the factors contributing to these inequities in each of the three countries. The second phase of SHIELD relates to identifying and critically evaluating options for the future development of health care financing mechanisms in relation to their potential equity impact and their feasibility and sustainability given attitudes of key stakeholders. This report focuses on aspects of this phase of work in South Africa, namely the feasibility and sustainability of alternative health financing reforms in relation to their respective resource requirements.

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