The starting point for medical scheme contribution increases is 3.8%, as recommended by the Council for Medical Schemes (CMS). However, the CMS also notes that this price point is subject to other influences, such as changes in utilisation. That matters because it sets the context for why contribution increases can move above inflation.
Until we address utilisation and other pressures that drive above-inflationary increases, affordability will remain a challenge.
Inflation input
Many assume medical aid increases should track the Consumer Price Index (CPI).
Inflation pushes up healthcare prices, but it isn’t the only driver. Utilisation is also a major contributor.
Utilisation means how often members use healthcare services.
Take a scheme that pays for 100 hospital procedures in 2026 and expects to fund 103 in 2027.
Its costs have increased 3% before even considering inflation.
Now assume, purely for illustration, that those procedures become 5% more expensive in 2027.
Simplistically, that’s an overall increase of 8%. Schemes aren’t just paying more for healthcare; they’re paying for more of it.
Age makes this harder. It also shapes the next pressure on affordability.
Older members generally need or utilise more healthcare, while high unemployment and low medical scheme uptake among younger people mean the risk pool is ageing.
Annual contribution increases cannot solve a problem that stems from an ageing membership, and reforms to improve the overall age of the medical schemes risk pool have remained outstanding for years.
Delayed reforms
Part of today’s pressure comes from reforms outstanding for more than 20 years. One of the clearest examples is community rating.
Community rating was a significant step: schemes can no longer set contributions according to age or health status.
But it was meant to form part of a wider package covering prescribed minimum benefits (PMBs), low-cost benefit options and mandatory membership.
The idea was a more balanced risk pool, with younger, healthier members helping carry the cost of an ageing membership.
Mandatory membership could potentially reduce overall medical scheme rates by as much as 30%.
The Competition Commission’s Health Market Inquiry raised these same issues a decade ago, yet no reforms have materialised. That delay leads directly to the current review process.
Another panel is reviewing PMBs, yet many review panels have come before; two decades later, no changes have been implemented.
Schemes are past the need for guidance; what we need is implementation of the outstanding legislation.
Rather than waiting for a flawed reform like the NHI, we should implement the outstanding reforms recommended by the Health Market Inquiry to improve affordability now.
Pay less, get less
When money is tight, a cheaper option looks sensible.
But a lower monthly contribution doesn’t necessarily mean lower healthcare costs. That distinction matters when people choose between options.
People often focus on what they can afford today and think less about what their scheme will need to pay for tomorrow.
Cheaper options can come with fewer benefits, higher co-payments and tighter limits.
Schemes regularly fund individual cases that run into millions of rands, with some exceeding R10m.
In some cases, members discover too late that their cover falls short, leaving them to find money for expenses that could have serious financial consequences.
This is also why medical scheme cover and health insurance aren’t the same thing. The distinction matters when comparing what each protects against.
Health Insurers may pay out for specific events, but shouldn’t be treated as a replacement for comprehensive medical scheme cover.
They usually carry extensive exclusions and can risk-rate individuals based on age and healthcare risks, attracting younger, unsuspecting, under-covered healthcare consumers.
The better question isn’t simply whether consumers can afford the monthly contribution. It’s whether they can afford what happens if their cover isn’t enough, which brings the affordability issue into focus.
Contribution considerations
As the review period approaches, I encourage South Africans to look beyond the percentage on their contribution notice.
Affordability matters, but it cannot be separated from health risks and treatment costs.
Members should understand what they’re paying for, review their benefits, and invest in their health by accessing appropriate preventative care benefits.
For schemes and policymakers, recognise that annual guidance cannot replace the long-term reforms needed to address the real drivers of cost.
The conversation ahead of 2027 isn’t only about what medical aid will cost. It also needs to consider whether people can still access the care they need, when they need it.
It’s about whether people can still access the care they need, when they need it.
Looking after your health is the best place to start. Consider it a step that may save you money and may save your life.
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