NHI Needs Medical Schemes to Survive

The NHI white paper stipulates that until the National Health Insurance is fully implemented and matured, the role of medical schemes will not change. Director General of the Department of Health, Precious Matsoso says, ‘This doesn’t preclude any changes to the business of medical schemes or transformation required in medical aid schemes.

‘Currently, the medical schemes’ role under the fully matured NHI is that of complementary services cover. This means that medical schemes may cover only services that the NHI  does not cover. If medical aid schemes undergo both voluntary and regulatory reform to become aligned and consistent with the objectives of NHI, there will be a need to relook this,’ Matsoso states.

NHI and Bonitas Medical Fund

Gerhard van Emmenis, Acting Principal Officer of Bonitas Medical Fund

Gerhard Van Emmenis, Principal Officer of South Africa’s second largest open medical scheme, Bonitas Medical Fund feels that it’s imperative that measures are put in place to allow medical schemes to work in tandem with the NHI, so that value for money is achieved and duplication of costs prevented. ‘Bonitas aims to make quality healthcare more affordable and accessible. We, therefore, welcome the efforts of the NHI to improve access to healthcare. However, our key concerns are around quality and preventing duplication of services.

‘If the future means it is only complementary cover from medical schemes then it will be very limited in its offerings with cover for services such as dentistry and rare conditions. This means that the number of medical schemes will greatly reduce.’

The number of medical aid schemes is dwindling regardless, as many schemes are struggling to main sustainability. However, we need clarity around whether people will be able to belong to a medical aid scheme. The funding model for the NHI means that everyone will contribute towards the NHI through a tax-based system. However, if you still choose to belong to a medical scheme then it’s your choice. You will have to pay for it out of your after-tax money. The idea is that the contribution to a ‘private’ medical scheme will be significantly less through price and other regulation. Making the schemes more affordable while, at the same time, using current medical scheme spending to cover vulnerable groups.

The private healthcare sector is not just for medical aid members

In 2016, Statistics South Africa estimated that 1 515000 households with no medical aid normally used the private healthcare sector. Additionally, 706000 households, where at least one member had medical aid, used the public health sector. In total, 4 679000 households’ normal place of consultation was the private sector.

This supports the findings of the National Income Dynamics Study. The Southern Africa Labour and Development Research Unit at the University of Cape Town did the study. The unit surveyed a nationally representative sample of more than 28000 individuals in 7300 households. The study found that 41.5% of the respondents used the private healthcare sector at their last visit.

‘The reality is that many people use a combination of both sectors,’ says Van Emmenis. ‘That means the number of people with medical aid does not equate to the number of people using the private health sector. The converse is also true. That’s because some medical scheme members use public hospitals or State clinical protocols for the treatment of specific conditions such as Tuberculosis.’

The role of medical schemes

Acting managing director of the Board of Healthcare Funders (BHF), Dr Clarence Mini, said he believed there should be more debate about the role of schemes in the future. ‘Since 2008 we have supported the idea of the NHI and believe that it is in the interests of the greater good of everyone. And not just the 16% who belong to medical schemes. But, we believe medical schemes have a bigger role to play. For example, we think it is a mistake to use a single-funder system.’

A ‘multi-payer’ system would mitigate a lot of risks. It is one way the private sector can lend their expertise to the Government regarding the setting up and management of pooled money within the NHI. ‘The Road Accident Fund is an example of what happens when you have one funder.  When that funder collapses you’re in trouble,’ Mini said.

Van Emmenis echoes this sentiment. ‘For NHI to be a success, a collaboration between medical schemes and Government is essential. We need to agree on the roles of both players as well what the NHI covers and what the medical schemes can offer.’

But what can medical schemes offer that NHI can’t?

However, irrespective of how comprehensive the NHI will be, some healthcare services will not be covered. That includes mental health and certain dental benefits.

Timeous service

According to the White Paper, NHI will be rolled out in priority areas first. The initial priorities include healthcare at schools, childhood cancer, women’s health (including pregnancy, cervical cancer and breast cancer), disability and rehabilitation services, and hip, knee and cataract surgery for the elderly.

But what about the remainder of the population? ‘Medical schemes offer a number of benefits that are immediately available to members. This allows members to access the care they need when they need it. If the NHI is to be rolled out to specific target groups first, what becomes of others in need?’ asks Van Emmenis.

Active management of chronic diseases

Medical schemes often cover a range of chronic diseases through managed care programmes which equip members to manage their condition more effectively. ‘We’ve seen improvement of 72% in Bonitas members with chronic diseases – especially diabetes and HIV,’ says Van Emmenis. ‘Quality of care is a central theme for us and we are pleased that our initiatives in this regard are bearing fruit. Engagement, collaboration and negotiation with healthcare professionals and service providers enable us to develop innovative solutions that ensure our members have access to care of the highest quality and receive maximum value for money.’

Functional administration

Existing medical schemes and administrators look after millions of South Africans and that capacity does not yet exist in the public sector. Managing the healthcare needs of 55 million South Africans will be an administrative nightmare and further drive costs up.

Preventative measures

A key healthcare challenge is finding a way to identify pre-cursors for serious chronic health conditions. The ideal would be to intervene before the onset of disease. While NHI makes provision for preventative care, it is not clear what this will entail. ‘Bonitas uses an innovative emerging risk model which identifies members likely to develop chronic conditions. We then conduct a series of interventions to prevent the development of these or help members to mitigate their severity. This includes access to health coaches, education material and reminders for tests. It has proved very successful with over 32 000 members benefitting,’ explains Van Emmenis.

Dental benefits

The State sector currently has very low patient-dentist ratios. The fact that many dentists choose to operate in the private sector is also a factor.

Mental health

More than 16.5% of adult South Africans are dealing with some form of mental health disorder. And 30% are likely to suffer from a mental disorder over the course of their lifetime. This is according to the South African Stress and Health study – the first and only nationally representative study of mental disorders in the country, which was done back in 2004. 13 years on, the figures are likely to have risen substantially. As things stand, only a fraction of Government’s national healthcare budget goes to mental healthcare. ‘Mental health is a key concern for Bonitas, we offer a range of benefits to aid members seeking support for depression, anxiety and other mental health concerns,’ says Van Emmenis.

The sustainable funding question remains

Escalating costs affect the healthcare industry. That has made it difficult for many medical schemes to maintain sustainability.The NHI not only faces a formidable challenge in funding, but there is also a severe shortage of healthcare providers, a massive disease burden and a blundering healthcare bureaucracy.


Bonitas is the second largest open medical scheme in South Africa. Administered by Medscheme Holdings (Pty) Ltd, Bonitas aims to make quality healthcare accessible to all South Africans and offers a wide range of plans that are simple to understand and easy to use. The Fund has the largest GP network in South Africa, a Specialist Network and a host of supplementary benefits paid from risk and carefully crafted managed care programmes to cover chronic conditions, cancer, diabetes and HIV/AIDS. This allows members to derive real value for money and stretch their benefits as far as possible.

All info was correct at time of publishing