Impact of COVID-19 on South African Medical Aids: The Good News and the Bad

impact of covid on medical aids

South African medical aid schemes have reacted swiftly to the unique challenges of COVID-19.

But how have they fared financially during the global health crisis? What has the impact of COVID-19 been? We share the news – good and bad.

Additional cost drivers

Virtual consultations, multi-channel communications and the timeous identification and enhanced medical management of high-risk members have all played a role in containing viral transmission and mortality rates.

These interventions by South African medical schemes are significant cost drivers. They were expected, along with the classification of the testing and treatment of COVID-19 as a Prescribed Minimum Benefit (PMB), to have a long-term impact on the affordability of medical aid.

The allocation of resources to cover the costs of contact-less healthcare consultations and courier-enabled chronic medication home deliveries has serious financial implications.

Critical support measures for financially stressed members

The implementation of support measures to assist members unable to pay contributions also escalated costs for medical schemes.

Medical schemes introduced payment holidays, allowed members to downgrade to cheaper options and to use accrued savings to cover monthly contributions.

High inflow of COVID-related claims

There has also been the impact on solvency levels of an unusually high inflow of COVID-related claims that were funded from the schemes’ respective risk pools.

When these cost drivers are taken into account, the news for consumers of medical aids in South Africa looks overwhelmingly dire.

Fortunately, there’s good news.

Elective surgeries and procedures down

The postponement of elective procedures and surgeries, alongside the avoidance of healthcare providers by members during lockdowns, has left medical schemes with massive surpluses.

Scheme reserves at all-time highs

The Council for Medical Schemes (CMS) estimates reserves have increased by approximately 35% year-on-year to reach an all-time high of R92.8 billion. Medical aid providers have spent considerably less than usual on non-COVID claims.

This means cost savers have cancelled out cost drivers.

As a result, medical aid providers in South Africa are in a position to fund the COVID-19 vaccine roll out for both members and non-members on a one-to-one basis.

No dramatic drop in scheme membership

What’s more, the widely anticipated consumer flight from medical schemes has not materialised. In fact, there was just a 0.2% drop in scheme membership in 2020, compared to 2019.

How have individual medical aid schemes fared in these difficult times?

Discovery Health

The largest medical scheme in South Africa grew its market share in 2020. It also recorded lower opt-out numbers compared to previous years.

Of the 6% of Discovery Health members who switched options at the end of 2020, half upgraded to a higher level of cover and half bought down.

Bonitas Medical Fund

The second largest medical scheme in South Africa recorded a 0.6% drop in membership during 2020. However, almost 62% of members downgraded to more affordable, mid-level options with fewer benefits.

Heightened healthcare support, via innovative virtual platforms, was tipped to be behind the better-than-expected retention rate.

Momentum Medical Scheme

Momentum experienced a similar dip in scheme membership. Consumers scaled down to more cost-effective plans or swapped to providers that charged less for the same level of cover.

Bestmed Medical Scheme

Bestmed bucked the trend by growing its membership base in 2020. It also registered one of its lowest termination rates in recent years.

With cash surpluses and stable membership numbers, South Africa’s medical aid schemes are in a remarkably healthy state, notwithstanding the COVID-19 pandemic.

This bodes well for the consumers of medical aid – now and in the future.


At IFC, we offer informed, objective advice about the impact of COVID-19 on South African medical aids, and can assist you in joining the scheme that best suits your needs and budget. Contact us for more information or to discuss your needs.

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