Medical schemes have become increasingly unaffordable and unattractive, said Christoff Raath, joint CEO of Insight Actuaries and Consultants, at the recent Board of Healthcare Conference (BHF). - Smart about Money, 15 May 2025
A "broken, incomplete and unsustainable” regulatory system has made medical schemes increasingly unaffordable and unattractive resulting in over 4.5m younger South Africans opting out, creating significant financial strain on open medical schemes.
Meanwhile, discussions about low-cost medical scheme benefit options (LCBOs) to bring them under medical scheme regulation and boost cross-subsidisationhave dragged on since 2005.
Raath described the current situation as a "slow death spiral" for schemes, forced to compete through hybridisation due to an incomplete regulatory framework.
“Actuaries had predicted this when the Medical Schemes Act was implemented in 2001, introducing community rating (charging everyone on an option the same rate regardless of health/age) and open enrolment (must accept applicants) principles without mandatory membership or a risk equalisation fund.”
A collapse of medical schemes within the next 10 – 15 years would leave 9m members unprotected and overburden the public healthcare system, said Vishal Brijlal of the Clinton Health Access Initiative.