By Katlego Mothudi
With plans in motion to roll out universal health coverage in South Africa, Dr Katlego Mothudi, of the Board of Healthcare Funders, argues that revising the compulsory prescribed minimum benefits that medical schemes must provide can be a tool to deliver meaningful improvements today while laying the foundations for a more sustainable healthcare system.
South Africa’s journey towards universal health coverage will not be defined by a single policy or piece of legislation, but by the practical reforms that make quality healthcare more accessible and affordable for more people. Achieving this goal requires, among other things, tackling structural barriers that continue to drive up the cost of medical scheme cover and place private healthcare beyond the reach of millions of people in South Africa. One of the most important, yet often overlooked, barriers is the outdated framework governing prescribed minimum benefits (PMBs).
PMBs are the set of conditions and services that every medical scheme is legally required to cover, regardless of the plan a member chooses. Their existence is critical, created with the intention of ensuring scheme members do not lose access to catastrophic care in the event of serious illness. PMBs ensure that members are not reliant on an over-burdened public sector during medical emergencies. And although this principle remains important, the framework has not kept pace with South Africa’s changing disease burden, evolving models of care, or the cost of delivering healthcare.
20 years of PMB limbo
Regulations made under the Medical Schemes Act require PMBs to be reviewed every two years. This must be carried out by the Department of Health together with the Council of Medical Schemes, provincial health departments and other stakeholders. In practice, this has happened only once, more than 20 years ago.
The current review process has been underway for close to a decade without conclusion. As a result, the outdated PMB framework has become one of the most significant contributors to medical scheme costs and thus an inefficient health policy. Actuaries advise that roughly 60% of a scheme’s budget goes towards funding PMBs before any other benefit is considered. This used to be approximately 40% when the PMB was amended in 2003.
The consequences of this laborious review process directly impact household budgets. The most basic scheme cover now costs a single beneficiary in the region of R1 600 a month, with a family of three facing around R4 000. For most working people in South Africa, that is simply unaffordable, and it is a significant reason why medical scheme membership has stagnated even as the population has grown. Furthermore, South Africa’s healthcare “missing middle” has grown to an estimated 8 million people who access private healthcare, paying out-of-pocket, without belonging to a medical scheme.
An out-of-date framework
If the PMB list were redesigned today, using current clinical evidence, the country’s evolving disease burden, and the realities of healthcare affordability, many of its benefits would likely look very different. The current framework no longer reflects what the system can sustainably provide. And because it consumes such a large portion of every scheme’s budget, it crowds out the very things that would make cover more affordable and more useful – primary care, early intervention and prevention.
At a recent Board of Healthcare Funders conference, Dr Fatima Hoosain, a specialist breast and endocrine surgeon, set out the numbers plainly: a mammogram and ultrasound cost in the region of R2 500. Left undetected until the disease has progressed, that same patient may require R100 000 in radiation therapy, R200 000 in chemotherapy, and, for HER2-positive cancers which typically can quickly spread from the breasts to other areas of the body, roughly R7 000 every three weeks for a year in targeted biological therapy. Early detection does not only save lives, but it is also, by a wide margin, the cheaper pathway. From a cardiology perspective, Dr Martin Mpe, president of the South African Heart Association, made the same point at the conference. He argued that the cheapest way to treat a heart attack is to prevent it, and that the system needs to start rewarding prevention rather than paying only for treatment after the fact.
Rather than expanding access, an outdated PMB framework has unintentionally limited it.
A PMB framework anchored in 1999-era diagnosis-and-treatment logic has little room for rewarding the prevention and early detection that would keep patients out of the expensive end of the system altogether. Importantly, reform does not mean stripping away protection. It means modernising the list so that mandatory cover reflects today’s clinical realities. It also means rethinking how the package is defined. The current approach is built around a long, condition-by-condition diagnostic list, a modern framework could instead focus on the essential health services people need most, including preventative care, primary healthcare services, medicines on an essential medicines list, and diagnostics on an essential diagnostics list. It could also emphasise the areas where the disease burden is greatest.
A core service package
This aligns closely with the Board of Healthcare Funders’ (BHF) recent commitment to explore a Core Service Package as a practical step towards universal health coverage. By focusing on the services that deliver the greatest health benefit within available resources, such an approach would place prevention and patients at the centre of the health system while creating greater flexibility to expand affordable access.
The BHF has previously worked to operationalise South Africa’s national Essential Medicines List (EML) within the private funding environment, partnering with MediKredit in 2021 to launch a NAPPI-coded mapping tool that helps funders align benefit design and claims systems with the EML, improve medicine access, and reduce out-of-pocket costs. This existing groundwork offers an affordable, prevention-oriented foundation on which a modernised PMB package could be built.
The evidence of where the current framework falls short is already available. Annually, the Council for Medical Schemes reports on out-of-pocket expenditure, which exceeded R40 billion last year. When people spend that much of their own money on healthcare, over and above their contributions, they are pointing directly to where their cover is failing.
A broader set of changes
PMB reform does not stand alone, and it will not by itself fix affordability. It is the entry point to a broader set of changes that reinforce one another. The most important of these is regulated tariff reform. South Africa currently lacks a transparent, predictable mechanism for setting provider prices, and this absence has driven costs upward for years. Allowing schemes and willing providers to negotiate fair tariffs, within a properly regulated framework, published for transparency, would bring discipline and predictability to pricing and give members clarity on what they are paying for.
Alongside this, permitting schemes to offer low-cost benefit options, a subset of the proposed revised PMBs and based on services rendered in the public sector clinics, would extend affordable, primary-care-based cover to millions of people in South Africa who currently fall outside the system and pay out-of-pocket for private care.
None of these reforms require new legislation or a wholesale restructuring of the health system. They can be pursued within the existing regulatory framework, and PMB modernisation is the logical place to begin, because it addresses the highest single cost in every member’s contribution and unlocks the room to fund better, more preventive care.
For members, this shift would be felt less as a change to their PMB entitlements and more as a change in what their contribution actually buys before a crisis ever occurs. Money currently locked into funding late-stage, high-cost treatment for conditions that could often have been caught earlier could instead support routine age- and risk-appropriate cancer screenings, cardiovascular risk assessments and blood pressure checks, diabetes screening and management support, and the kind of primary care consultations that catch problems while they are still cheap and simple to treat. None of this is about giving members less. It is about intervening earlier, so that fewer members ever need the R100 000 radiation course, the R200 000 chemotherapy regimen, or the cardiac admission that better screening or blood pressure control could have prevented.
There is an understandable reluctance to reopen the PMB framework, given how long the review has already taken and how contested the terrain can be. The longer reform is delayed, the greater the affordability pressures on households and the greater the strain on the broader health system.
Reforming prescribed minimum benefits is ultimately about far more than updating a list of conditions. It is about creating the flexibility to expand access, strengthen prevention and make medical scheme cover affordable for more people in South Africa.
*Mothudi is the Managing Director of the Board of Healthcare Funders, which represents around 45 medical aid schemes in South Africa, including GEMS and Bonitas.
*This piece was published by Spotlight – health journalism in the public interest. Spotlight aims to deepen public understanding of important health issues by publishing a variety of views on its opinion pages. The views expressed in this article are not necessarily shared by the Spotlight editors.
