Many South Africans believe that joining a medical scheme means that their hospital treatment is fully covered, only to be shocked when they receive their bill.
James White, Director of Sales at Turnberry Management Risk Solutions, said that patients are increasingly having to pay out of pocket despite being part of a medical scheme.
The patients encounter co-payments, specialist shortfalls and benefit sub-limits that leave them responsible for part of the bill.
This is due to medical schemes paying according to their own tariff structures, while specialists often charge far more than those tariffs, sometimes over 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,” said White.
“Gap cover exists specifically to address these shortfalls by covering the gap between what medical schemes pay and what healthcare providers charge.”
The existence of gap cover in South Africa is despite medical aids across the country announcing massive weighted average increases for 2026:
- Discovery: 7.2%
- Bonitas: 8.8%.
- Medshield: 7.5%.
- Bestmed: 6.8%
- Momentum: 9.9%
These increases are far higher than South Africa’s consumer price inflation, which stood at a mere 3% in February.
While many employees in South Africa received annual increases of around 4% or 5%, healthcare costs have risen by 9% to 10%.
“Hospital tariffs, specialist fees and the cost of advanced medical technology continue to increase each year,” said White.
“Medical schemes therefore face a difficult balancing act: keeping contributions affordable while managing rising provider costs.”
To do this, schemes are increasingly relying on co-payments, tighter benefit limits, and reimbursement based on scheme tariffs.
This means that belonging to a medical scheme does not guarantee that every medical expense will be fully covered.
Higher costs
A common out-of-pocket expense occurs when a healthcare provider charges more than the scheme rate.
Medical schemes reimburse treatment according to their own tariffs, while specialists can charge several times that amount.
This can create confusion for members, as policies often state that they may only pay “100% of the scheme rate”. The scheme thus pays up to its tariff limit, not the full amount charged by the provider.
When it comes to gap cover, the tariff shortfall accounts for the majority of claims, around 80%.
Shortfalls are not the only challenge; medical schemes now rely on co-payments and sub-limits to manage rising healthcare costs.
A co-payment is a fixed amount the member must pay before treatment. It depends on the procedure and scheme rules, and can reach over R30,000.
“For many households, being asked to produce this amount upfront can create significant financial strain,” said White.
“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.”
If the limit is reached, the remaining costs are borne by the patient.
With the medical scheme system being complex, many members only discover the gaps once they receive the treatment bill.
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.
White said that healthcare funding in South Africa is unlikely to become less complex in the near future, as costs are continuing to rise, making it essential to understand how the scheme works.
“Many people only learn how their cover works when a claim is processed and an unexpected bill appears,” said White.
“Understanding the difference between scheme tariffs, provider fees, co-payments and benefit limits can help prevent these surprises.”
