As healthcare reform gains momentum in South Africa, value-based care is becoming a hot topic – but meaningful progress has yet to take hold. The biggest hurdle? How care is purchased. Despite clear signs of stagnation, most funders remain committed to the same failed approach and have yet to drive the change that is needed.
“It’s encouraging to see a move away from fee-for-service thinking and a growing focus on value-based care. But to turn that interest into action will require real system reform – starting with strategic approaches to purchasing care that support system reengineering,” says Lungile Kasapato, CEO of PPO Serve, a healthcare management company that has been implementing value-based care in South Africa for more than a decade.
At its core, value-based care flips the script on how private healthcare is purchased in South Africa. Instead of rewarding volume, it prioritises prevention, puts patients at the centre, and ties payment to measurable outcomes. This stands in stark contrast to the dominant fee-for-service model, where doctors and hospitals are incentivised to provide more services rather than focus on delivering effective care.
A leading example of value-based care in practice is The Value Care Team, operationally supported by PPO Serve. This GP-led multidisciplinary programme broadens access while keeping costs in check. Teams are paid a risk-adjusted global fee to provide holistic patient care, along with substantial incentives tied to improved outcomes. The result is a model that aligns payment with patient outcomes – not the volume of services delivered.
To put it simply, Kasapato explains; “With value-based care, you don’t pay for every kilometre run, you pay to cross the finish line. And that finish line means improved health outcomes, prevention, and system efficiency.” For patients, primary healthcare under The Value Care Team looks and feels completely different. With no scheme benefit limits to navigate, patients are supported by a dedicated care coordinator who guides them through decisions made by their nominated GP and allied professionals. Each clinical team member has a complete picture of the patient’s health, working collaboratively rather than competitively to share accountability for delivering better outcomes.
This new approach to delivering primary care in the private sector isn’t just an isolated test run – it’s being developed and refined in real time. “We’re not just talking about value-based care, we’re implementing it,” says Kasapato. “At PPO Serve, we partner with practices to navigate day-to-day challenges, while working with medical schemes to design payment models that enable strategic purchasing. The Value Care Team is proof that value-based contracting isn’t just possible – it’s already happening in South Africa’s healthcare system.”
For this approach to take root and scale, medical schemes and state funders must take the lead by creating the market incentives that encourage providers and hospitals to adopt new ways of working. The Competition Commission’s 2019 Health Market Inquiry warned that without bold reform, South Africa’s private healthcare sector could face collapse – a warning that remains just as relevant today. But there is still an opportunity to change course. By embracing a strategic purchasing role, funders can help drive the system-wide transformation that’s urgently needed.
The Value Care Team is already leading by example, with a presence across Gauteng and KwaZulu-Natal, as well as in Bloemfontein and Gqeberha. Recognised by the World Health Organisation and featured in international peer-reviewed research as a breakthrough case study in emerging markets, the programme is actively driving real change – improving care coordination, cutting waste, and reducing unnecessary hospital admissions. Even so, Kasapato points out, the journey is far from over; “There is still a lot to learn from and with others as we move from talking about value to actually implementing it.”
