160% medical aid price hike warning for South Africa

Profmed CEO Craig Comrie warns that if key issues aren’t addressed, South Africans could face a substantial hike in medical aid costs, with increases as high as 160% projected for the coming years.

These steep costs threaten to strain household budgets, leaving many anxious about how to afford necessary healthcare coverage.

Even as inflation and interest rates show some signs of relief, healthcare costs are set to rise faster than many other expenses.

Major medical schemes in the country have already announced double-digit increases for 2025, underscoring the severity of the issue.

These hikes include weighted average increases of 12.75% for BestMed, 10.8% for MediHelp, 10.2% for Bonitas, 9.4% for Momentum, and 9.3% for Discovery.

Profmed has taken a comparatively moderate approach, planning an 8.4% increase; yet, even this lower figure represents a rising burden for members.

Although medical schemes are member-owned and non-profit—meaning they aren’t driven by a profit motive—they still face significant pressures due to escalating healthcare costs, Comrie said.

Key drivers of these increases include the rising prevalence of lifestyle-related conditions, costly advancements in medical technology, and a shrinking pool of doctors and specialists.

The result is a healthcare inflation trend that shows no signs of slowing, potentially doubling costs every seven years.

For instance, Comrie estimated that a monthly premium of R1,000 today could balloon to R2,600 per member within a decade, creating affordability issues for South Africans across all income brackets.

Wages and salaries simply do not keep pace with these rising costs.

Current salary increases hover around 6%, but an analysis by DebtBusters suggests that real income growth over the past eight years has been closer to just 1%.

When expenses like medical aid costs double over this period, the discrepancy creates an unsustainable situation for consumers, who cannot match the pace of inflation in essential services like healthcare.

Comrie said that the factors driving healthcare inflation are deeply intertwined with social and economic trends.

Chronic illnesses are on the rise, and the population is ageing, putting added pressure on medical schemes and public health services alike.

With this complex landscape, it’s clear that a simple solution to control costs doesn’t exist.

However, Comrie highlighted that one pivotal strategy is increasing health literacy among the population.

When people are well-informed about their health, they’re more likely to engage in preventative care, which reduces both the frequency and severity of medical claims. In turn, this can help ease the financial load on healthcare systems.

Preventative care is essential, as Comrie notes: “The best solution lies in an age-old healthcare adage: prevention is better than cure; or in this case, prevention is better than high costs.”

By incentivising regular health checks and screenings, medical schemes can encourage members to take control of their health proactively, potentially reducing the risk of chronic conditions that require costly, long-term treatment.

“Such measures could lead to significant cost savings for both individuals and medical schemes, helping curb future increases,” added Comrie.

The development of South Africa’s National Health Insurance (NHI) program is another factor influencing the future of healthcare costs.

While the NHI aims to provide universal healthcare access, it will face the same inflationary pressures as private schemes.

If healthcare inflation continues unchecked, the costs of running a universal health system could easily surpass the funds raised through taxes, as seen in other national health systems around the world.

When healthcare costs escalate faster than public revenues, countries often face difficult choices, such as restricting access to certain treatments or introducing private alternatives for those who can afford them.

This reality makes a robust private healthcare sector vital in South Africa’s future, as it can complement public services and ensure that essential healthcare remains accessible to all.

Ultimately, the value of a medical scheme extends beyond the premiums its members pay.

“The true value lies in the support, education, and quality of care schemes can provide, especially during significant health challenges.

“Medical schemes, therefore, play a dual role: they not only offer financial protection but also act as a health resource,” said Comrie.

“By promoting health literacy and preventative measures and by maintaining a well-functioning private healthcare sector, South Africa can work towards a more sustainable healthcare system where medical costs remain manageable and healthcare quality remains high,” he added.

In this environment, affordability will depend on proactive, informed choices at both the individual and institutional levels.

While South Africans are facing rising medical aid costs, there is a path forward through preventive care, increased health literacy, and a balanced approach to public and private healthcare.

Read: The CEO who eats McDonald’s every day of the week in South Africa