Tag: medical aid schemes

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Opinion Piece: Medical Aid Out-of-pocket Healthcare Expenses are the Highest Ever

On By ModernMedia

14 April 2026

Photo by Towfiqu barbhuiya on Unsplash

By James White, Director: Sales and Marketing at Turnberry Management Risk Solutions

Many South Africans assume that belonging to a medical scheme means their hospital treatment will be fully covered. In practice, this is often not the case. Patients are increasingly encountering co-payments, specialist shortfalls and benefit sub-limits that leave them responsible for part of the bill. This happens because medical schemes pay according to their own tariff structures, while specialists often charge significantly more than those tariffs, sometimes as much as 500% of the scheme rate.

The difference between the scheme tariff and the provider’s invoice is then billed to the patient, and it can amount to tens of thousands of Rands. Gap cover exists specifically to address these shortfalls by covering the gap between what medical schemes pay and what healthcare providers charge, offering peace of mind and greater financial certainty.

Healthcare costs are rising faster than household incomes

Medical inflation in South Africa has consistently outpaced general inflation. While many employees receive annual increases of around four or five percent, healthcare costs often rise by nine or ten percent. Hospital tariffs, specialist fees and the cost of advanced medical technology continue to increase each year.

Medical schemes therefore face a difficult balancing act: keeping contributions affordable while managing rising provider costs. To do this, schemes increasingly rely on co-payments, tighter benefit limits and reimbursement based on scheme tariffs. For members, this means that belonging to a medical scheme does not always guarantee that every medical expense will be fully covered.

The shortfall between tariffs and specialist fees

One of the most common out-of-pocket expenses occurs when a healthcare provider charges more than the scheme rate. Medical schemes reimburse treatment according to their own tariffs, while specialists may charge several times that amount. This can create confusion for members, because policies often state that they pay “100% of the scheme rate”. In practice, this means the scheme pays up to its tariff limit, not the full amount charged by the provider.

From a gap cover perspective, this tariff shortfall accounts for the majority of claims. In many cases it represents roughly 78% to 80% of claims, making it one of the most common funding gaps patients experience.

Co-payments and sub-limits add further pressure

Shortfalls are not the only challenge patients face – medical schemes increasingly rely on co-payments and sub-limits to manage rising healthcare costs.

A co-payment is a fixed amount that the member must pay before treatment takes place. Depending on the procedure and scheme rules, these amounts can range from around R5,000 up to R30,000, and in some cases even higher. For many households, being asked to produce this amount upfront can create significant financial strain.

Sub-limits can create a similar problem. Even when a procedure is covered, schemes may limit how much they will pay for certain treatments, scans or specialist services. Once the limit is reached, the remaining cost falls to the patient.

Why adviser education matters

Because the system is complex, many clients only discover these gaps when they receive a bill after treatment. They assume their medical aid will cover the full cost of care, only to find that co-payments, benefit limits or specialist shortfalls still apply.

This is why it is important for advisers to explain clearly how medical schemes pay claims, particularly the difference between scheme tariffs and provider fees. When clients understand how these shortfalls arise, the role of gap cover becomes easier to understand. Rather than being seen as an optional extra, gap cover becomes part of the overall structure of healthcare cover alongside medical aid.

Understanding your healthcare cover before you need it

Healthcare funding in South Africa is unlikely to become less complex in the near future. As costs continue to rise, it is essential to understand how your medical scheme operates and where potential shortfalls may arise.

Many people only learn how their cover works when a claim is processed and an unexpected bill appears. Understanding the difference between scheme tariffs, provider fees, co-payments and benefit limits can help prevent these surprises.

Gap cover plays an important role in addressing these shortfalls by covering the difference between what medical schemes pay and what healthcare providers charge. Speak to a broker about what your medical aid covers, where shortfalls may occur, and how gap cover can help protect you from unexpected medical bills.

Turnberry Management Risk Solutions (Pty) Ltd is an authorised Financial Services Provider (FSP no. 36571). Underwritten by Lombard Insurance Company, an Authorised Financial Services Provider (FSP 1596) and Insurer conducting non-life insurance business.

Categories : Healthcare Politics and RegulationsTags :

University of Pretoria Study Exposes Harmful Impact of Medical Aid Forensic Audits on Physiotherapists

On By ModernMedia

A University of Pretoria study has revealed troubling ethical and procedural gaps in the way medical schemes conduct forensic audits of physiotherapists, showing how practices intended to prevent billing irregularities are often leaving practitioners fearful, stigmatised and traumatised without proving guilt.

Audits of healthcare professionals are designed to detect billing irregularities and protect medical scheme funds. However, research conducted by Lesley Meyer, an extra-ordinary lecturer at University of Pretoria’s Department of Physiotherapy, explored the lived experiences of physiotherapists who have undergone such audits, and found that the audit practices conducted were experienced as punitive and harmful to practitioners rather than corrective.

Forensic audits in the healthcare sector are, in principle, supposed to protect medical scheme funds and by extension, patients’ contributions. In practice, however, Meyer’s research study, published in the latest edition of The South African Journal of Physiotherapy, found that these audits often extend beyond their legal scope and adversely affect the profession, while pocketing patient’s savings instead of returning these funds to the patients in accordance with the Medical Schemes Act.

Under Section 59(3) of the Medical Schemes Act of 1998, schemes may investigate inconsistencies in claims, but when alleged fraud, waste or abuse exceeds R100 000, the matter should be referred to the Health Professions Council of South Africa (HPCSA) or the South African Police Service. However, the study found that schemes mistrust these authorities, so they bypass that requirement by reclassifying potential fraud as administrative billing errors. This practice allows them to conduct internal investigations without external oversight, creating a loophole that has opened the door to misuse, coercive practices and a lack of accountability.“

Participants reported feeling unfairly targeted and singled out, describing the audit process as unfairly conducted. Many felt they were subjected to a witch hunt,” Meyer says, who is also a physiotherapist and runs a private outpatient practice with a special interest in chronic pain and trauma management. Participants described being treated as suspects rather than professionals and reported severe distress caused by a process that offers no transparency or recourse.

The study found that the problem is exacerbated by South Africa’s outdated billing system. The gazetted tariff codes, last updated by the Competition Commission in 2006, have remained unchanged. Due to the fact that medical aid schemes don’t accept new, unlisted codes, practitioners are forced to use outdated tariffs to describe modern, evidence-based treatments. In some instances, practitioners leave those treatments unbilled altogether.

The study found that practitioners were sometimes accused of overbilling or coding errors without being given access to the evidence used against them. Some described being pressured to sign an Admission of Debt (AOD) to avoid escalation, leading to payments that varied from R54 000 in a solo practice to R4,5 million for one group practice.

As reported in the study, the investigators’ tactics were perceived as coercive and participants were forced to either sign AODs or face continued blockages on payments, effectively turning them into cash practices. Physiotherapists operating as cash-based practices were blacklisted because scheme administrators could not use offset controls to manage claims.

Meyer explains: “For those who sign the AOD it means they’re admitting that they’re guilty, which is against the Health Professions Act, because if you are guilty, it means you’ve committed fraud, and you can lose your licence. But participants felt like they didn’t have a choice, because they weren’t getting any money from the schemes.”

The impact on clinical care

One of the key problems highlighted in the research is the lack of external oversight over medical schemes’ auditing procedures. While the Health Professions Council of South Africa regulates practitioner conduct, schemes are governed by the Council for Medical Schemes (CMS), however, a physiotherapist who participated in the study, who complained to the CMS received no response. This gap leaves practitioners vulnerable to arbitrary decisions and offers no appeal mechanism when they believe they have been treated unfairly.

Meyer says the distress caused by the audits has clear hallmarks of trauma with participants describing the trauma they experience being akin to post-traumatic stress disorder, triggering physical reactions such as going into a cold sweat when encountering reminders of the medical fund and enduring stigma from being blacklisted.

One participant said: “Seven months of watching my father die was easier than this experience.

”Meyer’s research shows that these experiences aren’t isolated incidents but systemic. Interviews revealed a pattern of practitioners who felt coerced into compliance due to their fear of professional ruin.

The study revealed that physiotherapists perceived the audit process as vindictive rather than beneficial. The physiotherapists also felt that the forensic investigators perceived them as being guilty from the start, without considering alternative reasons for irregular billing patterns.

These hostile auditing processes contradict the principle of procedural fairness, Meyer says, which requires fair treatment, transparency, impartiality and an opportunity to be heard.The way forwardThe study recommends teaching undergraduate and registered physiotherapists about forensic literacy. Therefore, Meyer created five lectures based on her findings’ which have been implemented with the fourth-year physiotherapy students as part of the IHL module at the University of Pretoria, to empower students and increase their resilience when faced with forensic audits in private practice.

Moreover, the study recommends a framework that allows practitioners to be heard and protected while ensuring that accountability remains central. Such a framework includes establishing an independent oversight body, standardising investigative procedures and ensuring audited practitioners can access evidence, respond to allegations and appeal decisions. Meyer will continue with this framework through a PhD.

A significant development since Meyer’s study was completed, is the release of the final report by an independent legal panel that reviewed how Section 59(3) of the Medical Schemes Act is applied in forensic audits of healthcare professionals. Meyer says the report confirmed many of the issues raised in her research, including retrospective audits, a lack of transparency and potential misuse of power by medical schemes.“

The release of this report is an important step toward institutional accountability and reform,” Meyer says. “However, the full implementation of its recommendations remains critical to ensure fair audit practices and to restore trust among healthcare providers.”

“The people I interviewed were not trying to avoid accountability. They wanted fairness. They wanted to be heard. If we don’t address the lack of oversight, we risk losing good practitioners and damaging trust in the healthcare system itself.”

Read the full study here

Categories : Medical IndustryTags :

Bonitas Medical Fund Revitalises Future of Healthcare in SA with New Strategic Partners

On By ModernMedia
Photo by Sora Shimazaki

The healthcare industry has evolved significantly in the past decade with innovation, improved servicing and consolidation of medical schemes emerging. Bonitas Medical Fund has taken a strategic step in responding to the needs of its members and the Health Citizens of South Africa, by appointing Momentum Health as its new administrator from 1 June 2026.

With a considerable history spanning over 4 decades, Bonitas Medical Fund has emerged as one of the leaders in the medical scheme market. Covering over 750 000 lives, the Scheme is known as the medical aid for South Africa with a range of options – strategically designed to meet the needs of South Africans from all walks of life.

The change in administration is in line with the guidelines of the Health Market Inquiry and the industry Regulator, the Council for Medical Schemes (CMS). In 2024, the CMS stated that, “one of the main issues driving market stagnation is the prevalence of ‘evergreen’ contracts”. This alludes to long-term agreements between medical schemes and suppliers spanning decades without being subject to regular competitive procurement processes.

Principal Officer, Lee Callakoppen, explains, “One of our key strategic objectives is to ensure we create value for our members and key stakeholders. This can take the form of benefit optimisation, favourable tariff negotiations, amalgamations to obtain critical mass or optimised service. The healthcare industry has evolved considerably over the past decade, and it was critical for the Scheme to evolve in line with this. Over the past 48 months, the Board have extensively debated the steps needed to be taken to place Bonitas in a competitive position and ensure that it remains sustainable in the best interest of our members. In doing so we have continuously evaluated the value provided by our service providers with consideration to our strategic objectives and the capabilities of our service providers as well as the expectations of our members corporate clients, healthcare professionals, and brokers. We have seen medical schemes placed under financial strain with sustainability challenges emerging and we remain committed to remaining relevant to our members and must therefore be vigilant in our approach.”

This was followed by rigorous ongoing benchmarking exercises and a subsequent Request for Proposal process for administrative services and managed care – with Momentum Health appointed as the successful entity for the provision of administration services and Private Health Administrators appointed to provide managed care services.

“We are delighted to cement this relationship with Momentum Health, who have demonstrated that they have the necessary capabilities to exceed expectations and support us in our strategic growth objectives” Callakoppen said. “Bonitas’ performance in the past 18 months, has exceeded all previous benchmarks with over 80 000 new families successfully enrolled on the Scheme and financial sustainability stronger than previous years. We see these appointments as strategic enablers to challenge the status quo – and drive value optimisation to continue leading the healthcare industry. Our aim is to optimise efficiencies, achieve mass enrolment, and meaningfully contribute to the shaping of private healthcare in South Africa.”

Hannes Viljoen, Chief Executive Officer of Momentum Health welcomed the appointment, citing it as a key strategic opportunity in the dynamic open market for Momentum Health. “We are excited about positively impacting the health of more people. The group currently service over 3,3 million beneficiaries in Africa and more than 25 million world-wide and are strategically and operationally positioned to deliver value in a meaningful and impactful way,” he said.

Dr Ayanda Mbuli, Chief Executive Officer of PHA, was pleased with the outcome, “We are deeply honoured by Bonitas’ decision to entrust PHA with its managed healthcare function, a historic milestone for the Scheme. This partnership presents a unique opportunity to further optimise the care received by Bonitas members and to meaningfully contribute to both the Bonitas healthcare agenda and the broader South African health landscape.”

Bonitas has been a leading open scheme in South Africa for several decades and these changes will open opportunities to build a more significant and influential open scheme that caters for more South African’s health care needs.

Categories : Expert Opinion Medical IndustryTags :

The Making of South Africa’s Medical Aid Crisis

On By ModernMedia

As of this month, South African medical aid scheme contributions have increased by between 6–9% – nearly triple the Council for Medical Schemes’ recommended 3.3% guideline. While lower than last year’s double-digit surge, the underlying problem remains: premiums keep climbing while benefit coverage keeps shrinking, exposing cracks in private healthcare that are becoming impossible to ignore.

“We’re watching private healthcare price ordinary South Africans out of the market, one annual increase at a time,” 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. “Medical schemes are caught in an impossible position – unable to control what providers charge, they’re left managing what they cover. The result is diminishing benefits, rising co-payments, and mounting out-of-pocket costs for members.”

The root of the problem lies in how healthcare is paid for. Fee-for-service, the dominant reimbursement model, rewards volume over outcomes. More tests, more procedures, more bed days – each generates revenue regardless of whether they actually improve patient health. This narrow focus fragments care and drives costs up while keeping value low.

“No amount of funding can fix a payment model that drives the wrong incentives,” Kasapato explains. “Real change requires rethinking not just what we pay for, but how we pay for it.”

Value-based care offers a fundamentally different approach: putting patients at the centre, rewarding proactive care, and linking payment directly to health outcomes. PPO Serve’s The Value Care Team demonstrates what this looks like in practice. GP-led multidisciplinary teams receive monthly, risk-adjusted payments based on patient complexity, supporting holistic care and linking meaningful incentives to measurable results. Rather than maximising billable services, providers focus on optimising patients’ overall health.

For members, this means care is no longer limited by rigid benefit caps or pre-authorisation hurdles, but structured around what genuinely enhances the efficient delivery of their care. A dedicated care coordinator guides patients through decisions made collaboratively by their GP and allied health professionals, with each team member sharing accountability for better outcomes.

But scaling models like this requires medical schemes and public funders to step up. “The challenge isn’t proving value-based care works – it’s embedding it in an infrastructure built for an entirely different system,” says Kasapato. “Claims processing, scheme administration, provider networks – every layer of private healthcare is designed with fee-for-service in mind. Transitioning to outcome-based payment means rebuilding that system and accepting the upfront investment and friction that comes with structural change. The alternative is stark: a private healthcare market that collapses under its own cost pressures, pricing out members faster than schemes can adjust. South Africa is already on that trajectory.”

“If we’re serious about universal health coverage and the long-term sustainability of the private sector, we can’t keep treating symptoms while ignoring causes,” says Kasapato. “Value-based care models are already demonstrating what’s possible. The question isn’t whether transformation is worth the investment – it’s whether we can afford to delay it any longer. The more organisations that embrace a strategic purchasing role, the greater the potential for meaningful change, not just for medical schemes but for South Africa’s healthcare system and the millions who rely on it.”

Categories : General Interest Medical IndustryTags :

Discovery Abandons R170 Million Clawback over Medicines Reimbursement Glitch

On By ModernMedia
Photo by Scott Graham on Unsplash

Discovery Health has recently abandoned its efforts to reclaim roughly R170 million from 16 507 members following a widespread administrative error in processing medical claims. This happened after the successful intervention of the advocacy group MediCheck, which argued that the affected members were being unfairly penalised for a technical glitch which they had nothing to do with.

The glitch, which happened last year, resulted in over-reimbursement of certain medicine costs that occurred throughout 2025. Several specific technical and procedural issues were involved which caused the problem to grow undetected for nearly a year, as detailed by Moonstone.

The main error was that certain claims were incorrectly reimbursed at 100% of the Discovery Health Rate, regardless of the specific benefit limits that should have applied to those categories, when they should have been reimbursed at a lower rate.

Because these claims were incorrectly reimbursed at higher rates, they were inaccurately accumulated towards members’ benefit thresholds. This caused members who had Above-Threshold Benefit (ATB) as part of their plan to reach it prematurely. Upon reaching the ATB, subsequent medical claims were funded by the scheme. Normally, these claims would have been covered by the members’ medical savings accounts or out-of-pocket contributions.

Delayed detection allowed the problem to grow. The error was particularly difficult to identify because it was a “second-order impact”. The systemic failure only became apparent late in the year when members began reaching the ATB and the financial discrepancies were finally flagged.

This snowballing error eventually affected some 16 507 members on specific Executive, Comprehensive, and Priority plans. While Discovery Health initially sought to recover these funds, ranging from thousands of rand to as much as R80 000 per member, the Council for Medical Schemes stepped in to exert pressure amid widespread media coverage of the situation. Discovery gave in and committed to refunding any recovered funds and absorbing the total financial loss itself – estimated between R130 million and R170 million.

Categories : Expert OpinionTags :

Opinion Piece: Turning Data into Wellbeing: Why Health Insights Are the Missing Link in Employee Benefits

On By ModernMedia

By Lushan Sundram, Senior Sales & Business Development Manager at Essential Employee Benefits

Despite making significant investments in employee benefits, many organisations continue to struggle with low employee engagement, growing healthcare expenses, and diminishing productivity.  A lack of insight, not a lack of investment, seems to be the problem. 

Even the most extensive medical coverage may fall short if the true health needs of the workforce are not thoroughly understood. Employers must first understand the individuals they are attempting to assist in order to make health benefits genuinely meaningful.

The business case for healthier workforces

It is now indisputable that employee well-being and company performance are related. Investing in the physical, mental, and social well-being of employees yields quantifiable benefits, according to numerous studies. According to research, a single unit improvement in staff health can result in an 80% boost in productivity, and well-run wellness programmes can yield a Return on Investment (ROI) of up to 6:1. Healthy workers are more engaged, more productive, and less likely to quit, demonstrating that promoting health, benefits businesses as well as individuals.

Moving from guesswork to insight

Understanding that health encompasses more than just physical well-being is the first step in creating pertinent and efficient medical coverage. Four important aspects are taken into account in a holistic approach: social, financial, mental and emotional, and physical welfare. The difficulty, though, is in understanding worker health without violating personal privacy. Data-driven platforms that provide aggregated insights while maintaining privacy hold the key to the solution. Digital nurse checks, for example, can evaluate vital signs including Body Mass Index (BMI) , blood pressure, body composition and more. Analysis of this anonymised data can then reveal patterns across age groups, genders, and departments. Employers can use these data to identify areas where their employees most need help, such as managing stress, preventing chronic diseases, or improving nutrition, all while maintaining complete compliance with privacy laws.  Essentially, it gives leaders the insight they need to allocate resources strategically.

From one-size-fits-all to tailored support

Once health insights are gathered, employers can move beyond generic benefit structures. Tailored medical cover ensures that plans address the most pressing needs of specific employee groups. For example, one division might prioritise diabetes prevention, while another invests in weight management or mental health programmes.

Barriers to access are also addressed by meaningful medical cover.  Employees may be deterred from obtaining private medical care by expensive premiums or difficult claims procedures. Instead, offering basic yet comprehensive cover promotes prompt treatment and keeps small problems from becoming more serious and expensive. Rather than concentrating only on reactive treatment, integrating preventative care contributes to the development of a sustainable culture of wellbeing.

Building loyalty through wellbeing

A targeted, data-driven benefits strategy does more than optimise healthcare spending, it strengthens trust and retention. Employee loyalty and engagement increase when they see that their employer truly cares about their well-being. Businesses with wellness programmes that are very successful report voluntary attrition rates of only 9%, whereas those with programmes that are less successful report rates of 15%.

This exemplifies the principles of Social Exchange Theory: when employees perceive that the organisation values them and supports their health, they reciprocate with loyalty and effort. In this way, wellbeing becomes a performance strategy, not merely a perk.

Partnering for precision and impact

To move from assumption to precision, many organisations are partnering with experts who use innovative, privacy-preserving tools to provide data-backed insights into workforce health. These insights enable executives to create inclusive and appropriate benefits that yield quantifiable increases in retention and productivity.

The capacity to act on data-driven health insights is a strategic imperative in a setting where healthcare expenditures and talent competitiveness are both on the rise. The healthiest, most resilient, and most dedicated workforces of tomorrow will be created by employers who make the investment to understand their employees today.

Categories : CancerTags :

Beyond the Diagnosis: The Financial Toll of Cancer in SA

On By ModernMedia

Cancer is one of the fastest-growing health challenges in South Africa, with over 100 000 new cases diagnosed annually, according to the National Cancer Registry. While most conversations focus on the physical and emotional impact, the financial strain of the disease often goes unspoken.

According to the South African Medical Journal, treatment costs for cancer can exceed R1 million per year, particularly when advanced therapies and prolonged care are required. This leaves many families facing difficult decisions that extend far beyond the hospital ward. With medical aid often falling short and with only 16% of South Africans covered by medical schemes, as reported by the Council for Medical Schemes the financial burden of cancer can be as devastating as the diagnosis itself.

“Medical aid alone often isn’t enough to cover the full cost of treatment, especially when it comes to critical illnesses like cancer,” says Matthew Green, Product Portfolio Manager at FNB Life. “We’ve seen firsthand how having the right insurance can make a real difference.”

The true impact of cancer is often measured in rands and cents: savings depleted, debt accumulated, and households forced to sacrifice essentials to pay for treatment. Myths about affordability and a lack of awareness mean that too many people enter this battle unprepared. The result is a financial shock that can be as devastating as the diagnosis itself. Beyond the direct medical expenses, families often face a range of additional costs from transport to and from treatment centres, specialised nutrition, home modifications, and caregiving support, to lost income due to time off work. Critical illness cover is designed to help bridge these financial gaps, providing a lump-sum payout that can be used not only for treatment, but also for these broader, often overlooked expenses that impact the entire household.

“Against this backdrop, insurers are under growing pressure to offer support that reflects the lived realities of ordinary South Africans. FNB Insure is among those stepping in to help close the gap – focusing on making financial protection more accessible, flexible, and relevant to everyday needs,” says Green.

Rather than positioning insurance cover as a luxury, the emphasis is on practical tools that help households navigate the rising costs of treatment and the economic strain that often follows a serious diagnosis. Whether it’s support during hospital stays, assistance with unexpected medical shortfalls, or a payout that enables immediate action after a diagnosis, the goal is to empower customers to focus on recovery – not financial survival.

This is evident from our customer feedback, where individuals have shared how timely access to cover helped them act quickly, avoid financial delays, and prioritise their health during some of life’s most difficult moments. “And its stories like this underline the importance of early financial planning and the role of accessible insurance in giving families space to focus on recovery rather than financial survival,” says Green.

With October marking Breast Cancer Awareness Month and November bringing the spotlight on men’s health through initiatives like Movember, FNB Insure is adding its voice to the broader call for awareness. “The message is clear: cancer doesn’t only affect health; it reshapes every aspect of life. Building resilience means preparing not just medically, but financially too,” concludes Green.

Categories : Medical IndustryTags :

Opinion Piece: The Lifetime Toll of Medical Aid Shortfalls

On By ModernMedia
Photo by Alex Green on Unsplash

By Tony Singleton, CEO at Turnberry Management Risk Solutions

21 October 2025

You plan for retirement, save for your child’s education, and try to build a financial cushion, but what happens when medical co-payments chip away at those plans, year after year? It starts small: a R5,000 co-payment for a scope. Then a few months later, a R12,000 shortfall for a hospital admission. Fast forward five years, and you’ve spent tens of thousands on out-of-pocket medical costs that your medical aid didn’t fully cover.

Medical aids cannot keep pace with the rate of medical inflation while still maintaining affordable premiums, so co-payments grow each year, more sub-limits are introduced, and specialist fees continue to outpace medical aid rates. This means more and more South Africans are finding themselves forced to draw from their retirement funds or take on debt to cover medical aid shortfalls. Medical aid alone is no longer enough to protect your financial future – gap cover has become essential.

How medical expense shortfalls silently accumulate

Medical scheme members, especially those on higher-end plans, often assume they are covered for any medical eventuality – until it is time to actually claim for a significant medical event. Even comprehensive plans can fall short when it comes to specialist charges, hospital procedures, or newer, high-tech treatments. Many specialists charge as much as five or six times the scheme rate, and certain procedures have limits to what medical aid will pay or require an up-front co-payment. While your medical aid might pay a portion, the remainder becomes your responsibility.

This can become a compounding problem. What starts as a few isolated bills adds up. Over time, shortfalls from surgeries, diagnostics, scopes, chronic illness treatment, or specialist consultations can add up to hundreds of thousands of Rands. For example, one Turnberry client managing spinal conditions, lupus, and gastro-oesophageal reflux disease (GERD) claimed R478,000 across 27 incidents in only five years. Another has claimed R450,000 across 54 incidents related to lung disease and spinal conditions, and a third, with multiple chronic issues, has received over R448,000 in gap cover payments over the same period. As the years go by, these amounts continue to add up, and this is becoming an increasingly typical pattern. Many families are forced to pause investments, take out loans, or remove money from their retirement annuities to keep up with these uncovered and unanticipated expenses.

Gap cover has become essential

Gap cover was created precisely to tackle these medical expense shortfalls, with an affordable policy that sits alongside medical aid and offers cover for medical expense shortfalls, co-payments, sub-limit cover, oncology shortfalls, prosthesis costs, and even casualty visits. Where medical aid benefits have tightened to control premiums, gap cover has expanded to fill the void.

Many South Africans still believe gap cover is a nice-to-have or something that is only necessary later in life. The reality, though, is that shortfalls affect people no matter what age they are, from broken bones in their 20s to maternity bills in their 30s or chronic conditions emerging in their 40s and beyond. Joining early also makes a difference, as you are covered from the start and your premiums will remain lower than someone beginning their cover at 65, when age-based premium increases and health exclusions may apply. Gap cover is not just for major surgeries or cancer treatments; it is valuable for more routine procedures as well as accidents and emergencies. And its value increases over time, especially if you remain continuously covered and avoid reintroducing waiting periods.

A long-term strategy, not a short-term fix

By staying on gap cover year after year, members build a stable financial buffer against the cumulative effect of medical costs. We’ve seen clients rely on gap cover for decades of health events, not just one-off emergencies, and the value of continuous cover is evident in our lifetime claims figures. Gap cover is no longer a luxury, it is an essential tool for building long-term financial resilience. Without it, medical aid shortfalls can easily undo years of careful financial planning. Talk to your broker about finding the best gap cover solution to fit your needs.

About Turnberry Management Risk Solutions

Founded in 2001, Turnberry is a registered financial services provider (FSP no. 36571) that specialises in Accident and Health Insurance, Travel Insurance, and Funeral Cover.

With extensive experience across healthcare and insurance industries in South Africa, Turnberry offers unsurpassed service to Brokers and clients. Turnberry’s gap cover products are available to clients on all medical aid schemes, as they are independently provided and are therefore transferable in the event of a change in the client’s medical aid scheme.

Turnberry is well represented nationally, with its Head Office based in Bedfordview, Johannesburg with Business Development Managers in Cape Town and Durban. The Turnberry Team’s focus on outstanding client service comes from having extensive knowledge and experience in the financial services sector and is underwritten by Lombard Insurance Company Limited. Lombard Insurance Company Limited is an Authorised Financial Services Provider (FSP 1596) and Insurer conducting non-life insurance business.

Categories : Expert Opinion Medical IndustryTags :

The Healthcare Financing Crisis and the Impact on Gap Cover

On By ModernMedia

A Five-Year Analysis of South Africa’s Healthcare Funding Challenge

Photo by Scott Graham on Unsplash

Mega Gap Claims Surge Reveals Private Healthcare System Under Cost Pressure

Opinion by Martin Rimmer, CEO of Sirago Underwriting Managers

A comprehensive five-year analysis of gap cover claims reveals a healthcare funding crisis that’s rapidly escalating across the South African private healthcare sector. Data from Sirago Underwriting Managers shows that its mega gap claims – those exceeding R50,000 – have exploded by 512% in volume and 437% in value between 2020 and 2024.

The numbers tell a stark story: where 89 mega gap claims totalling R6.2 million were paid in 2020, this figure rocketed to 549 claims worth R34 million in 2024. Perhaps most concerning is that claims exceeding R60 000 are now daily occurrences, with the average large loss gap claim sitting at R63 000 – a far cry from the R6000 to R12 000 averages seen pre-2020.

The Perfect Storm: Medical Scheme Erosion Meets Provider Cost Inflation

This upward trajectory reflects a fundamental shift in South Africa’s healthcare landscape. Medical schemes – constrained by affordability, access, aging membership populations, and where private healthcare already consumes up to 20% of household income – are systematically reducing benefits and transferring more risk onto the member, rather than increasing premiums to match out-of-control healthcare provider cost inflation.

Healthcare provider costs have consistently outpaced inflation by more than double for years, yet unlike pharmaceuticals, there’s no pricing regulation on healthcare provider tariffs. In a country facing a dire shortage of healthcare professionals, specialists are free to charge rates often 500%+ higher than medical scheme reimbursements.

The regulatory framework compounds this issue. The Registrar of Medical Schemes mandates that for Prescribed Minimum Benefit (PMB) conditions, where no Designated Service Provider agreement exists, healthcare providers must be paid in full regardless of the charge – essentially providing a blank check.

Breaking Down Sirago’s Large Loss (Mega) Gap Claims Data (2020-2024)

Five-Year Trend Analysis

  • 2021: 118% increase in claims value paid compared to 2020, driven by COVID-19 impacts and deferred elective surgeries.
  • 2022-2024: Average annual increase of 35% year-on-year in large loss claims volumes.
  • Highest claims: R200,000+ for ischaemic heart disease conditions in the 50+ age group.

Age Demographics Challenge Assumptions

Contrary to expectations, healthcare crises aren’t limited to older populations:

  • 50-65 years: 31% of claims (average: R65,065)
  • 66-75 years: 27% of claims (average: R64,213)
  • 76+ years: 18% of claims (average: R62,773)
  • 30-49 years: 18% of claims (average: R58,116)
  • 0-29 years: 5% of claims (average: R63,360)

The under-49 age group constitutes 23% of all large loss claims, dispelling notions that major health expenses only affect older demographics, and which highlights the risk transfer challenges faced and imposed by medical schemes.

Claims Distribution

  • 62%: R40,000-R60,000
  • 30%: R61,000-R100,000
  • 6%: R101,000-R150,000
  • 2%: R151,000-R210,000

Leading Conditions Driving Claims

  • Musculoskeletal Dominance

Over 51% of claims across all age groups involve musculoskeletal conditions, with spinal stenosis leading the charge. Medical schemes often impose strict limits on elective musculoskeletal surgeries due to high costs, particularly for internal prosthetics where co-payments can reach 30% of the hospital account if members don’t subscribe to the scheme-imposed protocols.

  • Cancer and Circulatory Conditions

Each representing 10% of large loss claims, these conditions reflect both the effect from the delayed diagnosis impact of COVID-19 and the high-cost nature of specialised treatments. Malignant neoplasms of the breast, prostate, and colon lead cancer claims, while acute ischaemic heart disease dominates circulatory conditions.

  • The Exploitation Factor

Gap insurance is increasingly becoming a target for exploitation. Healthcare providers now routinely ask patients upfront about gap coverage before determining charges, creating a troubling paradox where a R700 monthly gap policy might pay R130,000 for an orthopaedic surgery shortfall, while the medical scheme with an R8,000 monthly premium pays just R30,000. This exploitation threatens the sustainability of gap insurance itself. If current trends continue, gap insurance premiums will inevitably rise, making this crucial protection unaffordable for many South Africans.

The Critical Importance of Gap Cover

Despite these challenges, gap cover remains essential, irrespective of medical scheme option. Most medical schemes have deductibles, co-payments, and reimbursement limits that can leave members significantly out of pocket. The gap between scheme payments and specialist charges can be substantial – often 200% to 500% above scheme tariffs and this isn’t limited to basic hospital cover options. Even comprehensive, top-tier medical scheme benefits leave members facing substantial tariff shortfalls for in-hospital procedures.

The Economics of Healthcare Financial Protection

When you consider the potential financial quantum of a shortfall on your medical scheme benefits, and that a gap cover premium is around R700 per month for a family (2025 Sirago Ultimate Gap), and each family member is covered for up to a maximum of R213 000 per annum, it is clear that Gap Cover is a non-negotiable part of your healthcare financing strategy.  A single gap claim of R63k, Sirago’s average large loss claim, would be the equivalent of almost 9 years of premium payments at current premium rates.

Sirago’s mega claims data reveals a private healthcare funding system under severe strain. As medical schemes transfer more financial risk to members through tariff shortfalls, co-payments, and exclusions, gap insurance becomes not just “a-nice-to-have” insurance policy, but essential for financial protection.

However, the sustainability of this model depends on addressing the root causes: unregulated provider pricing, systematic benefit erosion, and the exploitation of gap insurance by unscrupulous providers. Without intervention, South Africa’s healthcare funding crisis will continue to deepen, leaving patients to bear an ever-increasing financial burden.

For consumers, the message is clear: always negotiate pricing for planned surgeries and request formal quotes from all medical role players. In a system where healthcare providers are price makers and medical schemes and gap providers are price-takers, informed patient advocacy becomes crucial for financial survival and your continued access to quality private healthcare.

(Claims statistics drawn from Sirago’s Large Loss Claims Analysis, 2020-2025)

Sirago Underwriting Managers (Pty) Ltd is an Authorised Financial Services Provider (FSP: 4710) underwritten by GENRIC Insurance Company Limited (FSP: 43638). GENRIC is an authorised Financial Services Provider and licensed non-life Insurer and a member of the Old Mutual Group.

Note:  The content of this article does not constitute financial advice. Sirago Gap cover is subject to terms and conditions and premiums are reviewed annually. For more information go to www.sirago.co.za (Ts & Cs apply).

Categories : Expert Opinion Medical IndustryTags :

Opinion Piece: Why Employee Benefits Need to Go Beyond Medical Aid

On By ModernMedia

By James White, Director of Sales and Marketing at Turnberry Management Risk Solutions

Photo by Alex Green on Unsplash

Rising medical costs can be a major burden that negatively affects employees’ health, wellness and productivity. Even with medical aid in place, unexpected shortfalls for hospital stays, surgeries and specialist treatments can run into tens of thousands of Rands – creating financial stress that spills over into the workplace.

Group gap cover offers an affordable, accessible and highly effective way to bridge the growing divide between what medical schemes pay and what private healthcare actually costs. This makes a tangible difference for both employers and their employees.

A practical solution for reducing stress and improving productivity

Medical expense shortfalls can add up to significant amounts of money and can be enough to seriously impact an individual’s financial wellbeing. Employees who cannot afford the co-payments or gaps in cover may delay treatment, manage ongoing pain with temporary measures, or fall back on high-interest loans, all of which can negatively affect their focus and performance at work.

Group gap cover can help to prevent this type of scenario. Cover includes medical expense shortfalls, co-payments, and sub-limits, and some providers also offer value-added benefits like casualty cover, trauma counselling or additional cancer cover, depending on the plan.

This allows employees to access the care they need without having to worry about paying large sums of money out of their own pocket. It helps them get treatment sooner, making it more likely they will recover faster and return to work sooner, as well as offering improved peace of mind. All of this benefits the business as much as the individual.

Empowering brokers to support a broader wellness strategy

Brokers are ideally placed to support employers in designing employee benefits that do more than tick boxes by positioning group gap cover as an essential component of an organisation’s wellness strategy.

It is, however, essential to tailor group gap cover plans to align with the medical aid options that are already in place. The key is to create solutions that fit the needs of the organisation and its employees and add tangible value, taking into account elements like demographics, income bracket, life stage and so on. For brokers, this is an opportunity to drive innovation in employee benefits and demonstrate deeper advisory value.

Affordability that matters in a tough economy

As medical inflation continues to outpace the Consumer Price Index (CPI), comprehensive medical aid has become less attainable for many companies and their employees. Some organisations have been forced to downgrade their medical scheme contributions, leaving employees more exposed to shortfalls. Group gap cover offers a cost-effective way to mitigate that risk.

With preferential premiums, favourable underwriting terms, and often no waiting periods, group gap cover is cost-effective and affordable, especially when compared to the costs of upgrading a comprehensive medical aid plan that will typically also experience certain shortfalls. It is also tax efficient as a payroll deduction and can be implemented with minimal administrative burden.

Attracting and retaining talent in a competitive market

Today’s job seekers are looking for more than a payslip. They want to feel valued and supported. Offering group gap cover as part of a holistic benefits package can set a company apart, especially in sectors where high turnover is common.

Candidates take note when employers show they care about more than just performance metrics. A company that helps its people avoid financial distress during a medical emergency is a company that builds loyalty, trust and long-term engagement. Gap cover is an investment in human capital that pays dividends far beyond the balance sheet.

Genuine benefits build genuine loyalty

Medical costs are rising, and economic pressures are continually increasing. In such an environment, employers need benefits that do more than look good on paper – they need to add real value to the lives of their employees. Group gap cover is one of the most practical, cost-effective ways to support employees’ health and financial wellbeing while also protecting business performance.

By helping people access the treatment they need without incurring crippling debt, it reduces stress, shortens recovery time and fosters loyalty. For businesses looking to attract and retain talent, boost productivity and show genuine care for their people, group gap cover is a benefit that makes a real and lasting difference.

About Turnberry Management Risk Solutions

Founded in 2001, Turnberry is a registered financial services provider (FSP no. 36571) that specialises in Accident and Health Insurance, Travel Insurance, and Funeral Cover.

With extensive experience across healthcare and insurance industries in South Africa, Turnberry offers unsurpassed service to Brokers and clients. Turnberry’s gap cover products are available to clients on all medical aid schemes, as they are independently provided and are therefore transferable in the event of a change in the client’s medical aid scheme.

Turnberry is well represented nationally, with its Head Office based in Bedfordview, Johannesburg with Business Development Managers in Cape Town and Durban. The Turnberry Team’s focus on outstanding client service comes from having extensive knowledge and experience in the financial services sector and is underwritten by Lombard Insurance Company Limited. Lombard Insurance Company Limited is an Authorised Financial Services Provider (FSP 1596) and Insurer conducting non-life insurance business.