Navigating South Africa’s Medical Aid Increases for 2025

South African medical aid members are preparing for another year of significant contribution increases in 2025, with all the largest schemes announcing above-inflation adjustments. Year-on- year consumer inflation in August 2024 was 4.4%; however medical inflation is significantly greater than this.

It is that time of the year when members can make option changes to be effective 1 January 2025, but it is crucial for members to carefully evaluate and understand their medical aid plans to avoid being caught off guard by rising costs and changing benefits.

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Overview of 2025 Medical Aid Increases

The announced increases which are subject to Council for Medical Scheme (CMS) approval for 2025, are among the highest in recent years, reflecting rising healthcare costs and pressures (both on the supply side and the demand side) within the sector. Here are the weighted average increases for some leading schemes:

Five-Year Trends in Medical Aid Increases

The increasing trend is obvious from the above – 5% to 8%, 8% to 10% and now 9.3% to 12.8%. Medical schemes have explained the increase in medical inflation as follows:

• increases in the price of healthcare services, typically in line with consumer inflation; and
• increases in the demand for healthcare services, because of a gradually ageing membership, increasing prevalence of chronic illnesses, and an increasing proportion of high-cost claimants; and
• increases in the supply of healthcare services through new medicines, new medical technologies, advances in medical procedures and increased need for specialised care.

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How to Approach the Option Change Season

Given the significant increases, members must carefully reassess their healthcare needs and budgets. Here are some tips for choosing the best option during the option change season, which will help the discussion with your healthcare broker:

Evaluate Usage Trends: Analyse your claims history to determine whether a comprehensive or basic plan is more appropriate.

Review Scheme-Specific Changes: Certain medical schemes, for example, have introduced enhancements such as improved maternity and wellness benefits, which might make specific plans more appealing.

Compare Plans Across Schemes: While some option increases are on the higher side, they may offer value-added services that could justify the cost for some families and specific high-cost needs while certain more cost-effective options may impose co-payments, exclusions and network providers.

Gap Cover and Supplementary Insurance: Consider gap cover to protect against shortfalls for in-hospital benefits, especially when considering downgrading to lower plans which offer limited provider networks and co-payments.

Plan for Financial Sustainability: Align your chosen option with your healthcare needs for the next year.

The 2025 medical aid increases underscore the importance of making informed decisions during the option-change season. With schemes introducing significant hikes and benefit changes, selecting the right plan can be overwhelming. Aligning your healthcare needs with the right coverage is essential to avoid unnecessary costs and surprises down the road.

At Axiomatic, we pride ourselves on providing employer groups and employees with independent, expert guidance on the most appropriate healthcare and employee benefit solutions. Whether you need help comparing medical aid options, understanding benefit structures, or implementing gap cover, we are here to support you.

Don’t navigate these changes alone start a conversation with us: Contact us