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Medical Aid Funding Updated Report Available
BY Carole Veitch
South Africa
11 April 2016
R 2 040.00 (ZAR)  
estimated $ 143.91 (USD) *
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Medical Aid Funding Sector


This report focuses on South Africa’s medical aid funding industry. The sector comprises 83 registered medical schemes, 23 open and 60 restricted, and currently serves almost 8.8 million beneficiaries. With scheme contributions of R140.2bn and healthcare expenditure of R124.1bn for the financial year ending 31 March 2015, the industry plays a critical role in South Africa’s private health sector, which is currently the subject of a Competition Commission inquiry.


Consolidation and Growing Pressure


During the past fifteen years, the South African medical aid funding industry has consolidated, with numerous small medical schemes amalgamating with larger schemes. Between 2000 and 2015, the total number of registered medical schemes decreased by 42%. According to the Council for Medical Schemes (CMS), consolidation is viewed as “a response to market forces and is not necessarily a negative development or an indication of instability in the South African medical schemes environment.” However, the medical aid funding industry is a sector under increasing pressure. Regulatory uncertainty continues to undermine the industry. Challenges identified by stakeholders include demarcation regulations and regulations governing Prescribed Minimum Benefits (PMBs). Many role players have called for a review of regulations relating to solvency calculation, risk equalisation and governance. While the number of beneficiaries receiving treatment for chronic diseases rises, the number of new members is decreasing, a trend that is expected to continue. Role players have cited unemployment and the lack of disposable income as the major contributing factors.


Report Coverage


The report on the medical aid funding sector describes the current market, the latest regulatory developments and discusses factors influencing the success of the sector. The report profiles nine medical fund administrators and 23 medical aid companies including market leader, Discovery Health which increased its market share in the open medical schemes segment from 52.4% in 2013 to 53.4% in 2014, and the Government Employees’ Medical Scheme (GEMS), the largest of the restricted medical schemes.


Page
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Value Chain 3
2.2. Geographic Position 4
3. SIZE OF THE INDUSTRY 6
4. STATE OF THE INDUSTRY 11
4.1. Local 11
4.1.1. Corporate Actions 15
4.1.2. Regulations 16
4.1.3. Enterprise Development and Socio-Economic Development Initiatives 19
4.2. Continental 21
4.3. International 22
5. INFLUENCING FACTORS 24
5.1. Economic Environment 24
5.2. Government Intervention 25
5.3. Input Costs 26
5.4. Commercial Health Insurance 28
5.5. Managed Health Care 28
5.6. Technology, Research and Development (R&D) and Innovation 29
5.7. Labour Resources 31
5.8. Environmental Concerns 33
5.9. Cyclicality 34
6. COMPETITION 35
6.1. Barriers to Entry 36
7. SWOT ANALYSIS 37
8. OUTLOOK 38
9. INDUSTRY ASSOCIATIONS 39
10. REFERENCES 39
10.1. Publications 39
10.2. Websites 40
APPENDIX 1 42
Registered Medical Schemes – 2014/2015 42
APPENDIX 2 44
Medical Scheme Administrators 44
APPENDIX 3 45
Managed Care Organisations (MCOs) – 2014/2015 45
COMPANY PROFILES – OPEN MEDICAL SCHEMES 48
BESTMED MEDICAL SCHEME 48
BONITAS MEDICAL FUND 51
DISCOVERY HEALTH MEDICAL SCHEME 53
FEDHEALTH MEDICAL SCHEME 56
KEYHEALTH MEDICAL SCHEME 58
LIBERTY MEDICAL SCHEME 60
MEDIHELP MEDICAL SCHEME 62
MEDSHIELD MEDICAL SCHEME 64
MOMENTUM HEALTH 66
SIZWE MEDICAL FUND 68
SPECTRAMED MEDICAL SCHEME 70
COMPANY PROFILES – RESTRICTED MEDICAL SCHEMES 72
BANKMED MEDICAL SCHEME 72
CHARTERED ACCOUNTANTS MEDICAL AID FUND 74
GOVERNMENT EMPLOYEES MEDICAL SCHEME 76
LA-HEALTH MEDICAL SCHEME 79
MOTO HEALTH CARE 81
NEDGROUP MEDICAL AID SCHEME 83
PLATINUM HEALTH 85
PROFMED MEDICAL SCHEME 87
SAMWU NATIONAL MEDICAL SCHEME 89
SASOLMED MEDICAL SCHEME 92
SOUTH AFRICAN POLICE SERVICE MEDICAL SCHEME 94
TRANSMED MEDICAL SCHEME 96
COMPANY PROFILES – FUND ADMINISTRATORS 98
AGILITY HOLDINGS (RF) (PTY) LTD 98
DISCOVERY HEALTH (PTY) LTD 100
MEDSCHEME LTD 103
METROPOLITAN HEALTH CORPORATE (PTY) LTD 106
MMI HEALTH (PTY) LTD 108
PROFESSIONAL PROVIDENT SOCIETY HEALTHCARE ADMINISTRATORS (PTY) LTD 110
PROVIDENCE HEALTHCARE RISK MANAGERS (PTY) LTD 111
SECHABA MEDICAL SOLUTIONS (PTY) LTD 113
STRATA HEALTHCARE MANAGEMENT (PTY) LTD 115
UNIVERSAL HEALTHCARE ADMINISTRATORS (PTY) LTD 117
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