South African public workers face bad news after the Council for Medical Schemes (CMS) rejected the Government Employees Medical Scheme’s (GEMS) lower price adjustment for 2026.
The medical scheme had initially proposed a 9.8% price adjustment.
Denied
In comparison, News24 reports that major medical schemes in the country — including Discovery Health Medical Scheme, Medshield, Bestmed and Bonitas — all implemented contribution adjustments under 9%.
After objections from the Public Servants Association, GEMS asked the CMS to reduce the previously approved weighted average contribution adjustment from 9.5% to 7.5%.
The CMS has not approved the proposed adjustment.
As a result, the scheme will maintain the previously approved weighted average contribution adjustment of 9.5%.
Solvency concerns
Business Day reports that CMS registrar Musa Gumede highlighted GEMS’s actuary’s point that the scheme was unable to support the 7.5% reduction.
“The scheme has not demonstrated that the proposed contributions are actuarially accurate,” said Gumede.
Gumede also indicated that the 7.5% price adjustment could leave GEMS with a shortfall and push its solvency ratio down to 22.9%.
In South Africa, the Medical Schemes Act requires medical schemes to hold a solvency ratio of at least 25%.
Gumede added that the medical scheme hadn’t demonstrated a clear plan for restoring its solvency.
Affordability
In response, Dr Stan Moloabi, principal officer of GEMS, said the scheme wanted to drop the contribution adjustment to reduce its members' financial burden.
“The proposal to reduce the contribution adjustment was informed by the scheme’s commitment to easing the financial burden on members wherever possible,” said Moloabi.
“We recognise the cost-of-living pressures many of our members continue to face, and affordability remains a key consideration in every decision we make.”
Having accepted the CMS’s decision, the scheme says it is currently finalising the necessary implementation arrangements to ensure members — who, according to the Department of Public Services and Administration, are around 890,000 principal members and more than 2.4 million dependents — are informed and supported throughout the process.
