Over the past few months, the South African healthcare landscape has experienced significant developments, both globally and locally. These changes could potentially impact the industry and the delivery of healthcare services in the country.

Global Impact: US Decision on PEPFAR Funding

A notable development occurred when US President Donald Trump signed an executive order to suspend funding for the President’s Emergency Plan for AIDS Relief (PEPFAR) to South Africa. While the long-term effects of this decision remain uncertain, concerns are mounting about its potential impact on the progress South Africa has made in combating the HIV/AIDS epidemic. PEPFAR has played a crucial role in the global fight against HIV/AIDS, providing critical resources for prevention, treatment, and care. The suspension of this funding leaves several key health intervention projects in a state of uncertainty, particularly as South Africa has one of the largest HIV populations in the world.

Budget Speech: South Africa

The country recently witnessed the challenges that come with the Government of National Unity (GNU). The annual budget speech, delivered by Minister of Finance Enoch Godongwana, was initially postponed due to a lack of consensus among the parties involved. However, the issue was resolved, and the speech was successfully delivered on 12 March 2025. Despite the delay, there has been little to no significant impact on the private healthcare sector. The medical scheme tax credits, a critical element in the private healthcare system, remain unchanged for the upcoming fiscal year, reflecting continuity in the sector’s taxation policy.

To read more about the Budget speech, click here

National Health Insurance (NHI) Update

Reports indicate that discussions were held between Minister in the Presidency for Planning, Monitoring, and Evaluation, Maropene Ramokgopa, Minister of Health Aaron Motsoaledi, and Democratic Alliance leader Johan Steenhuisen, during a Cabinet Lekgotla last month. These discussions focused on finding solutions to allow private healthcare and the NHI to coexist, ensuring that private sector involvement is incorporated into the NHI’s funding models and overall implementation.

Earlier this month, Minister Motsoaledi published the first draft of regulations under Section 55 of the NHI Act, which outlines governance structures and operational processes for the NHI Fund. Section 55 grants the Minister the authority to create regulations on several critical aspects of the NHI, including:

• Governance of the NHI Fund: Defining the board’s structure, responsibilities, and powers.
• Operations of the NHI Fund: Details on how the Fund will procure healthcare services, manage finances, and interact with healthcare providers and users.
• Funding of the NHI Fund: Clarification of the Fund’s sources of financing, including mandatory prepayments and additional funding streams.
• Procurement of Healthcare Services: Processes for engaging both public and private healthcare providers.
• Registration of Users: Requirements for individuals to register as NHI users and eligibility criteria.
• Additional Provisions: Other regulations deemed necessary for the NHI’s implementation.

These regulations mark a critical step in the NHI’s journey towards providing universal healthcare coverage to all South Africans.

Governance of the Medical Scheme Industry

In parallel, the Council for Medical Schemes (CMS), the statutory body responsible for regulating the private healthcare financing sector, has taken steps to address some of the issues highlighted by the Health Market Inquiry (HMI). One of the key findings of the HMI was the complexity and confusion many medical scheme members face when selecting the right plan, often opting for cheaper options that do not meet their healthcare needs adequately.

As part of the response, CMS has recommended standardising a supplementary benefit package. This would aim to simplify the process for choosing a medical scheme and better align benefits with the needs of members, ensuring that patients are at the centre of the healthcare system. The standardised package would include guidelines on benefit content, benefit ceilings, thresholds, and premiums.

In light of the above, CMS also announced plans to conduct a needs assessment to better understand the different market segments and how medical scheme options can be classified to cater to diverse beneficiary profiles.

Moving Forward

The recent advancements in the National Health Insurance Bill and CMS’s efforts to address issues in the private medical scheme industry are positive developments in the quest to provide universal healthcare coverage. While challenges remain, particularly regarding the integration of private healthcare into the NHI framework, the progress made thus far indicates that the South African healthcare system is moving towards the common goal of enhancing the quality and access to healthcare.