Levies On Medical Schemes
By Rudolph Ackermann, CEO at MANAGE ALL
Source: Council for Medical Schemes
Imposition Of Levies On Medical Schemes
The Council for Medical Schemes (CMS), after consultation with the Minister of Health, hereby confirms the imposition of a R51.49 levy per member on medical schemes for the 2025/26 financial year. In respect of the levy year, the number of members referred to, shall correspond with the latest statistics furnished to the Registrar of Medical Schemes in terms of or by virtue of the Medical Schemes Act, 1998 (Act No. 131 of 1998) or with the latest certified number of members sent to the Registrar by the medical scheme.
The imposition of levies for medical schemes in 2025/26 will primarily affect medical scheme members through the increased costs of maintaining their cover. This is because the levies, which are used to fund the CMS and other regulatory functions, are ultimately factored into the scheme’s overall costs, which are then passed on to members through higher contributions or reduced benefits.
Here’s a more detailed breakdown:
Reduced Benefits:
In some cases, schemes may opt to reduce benefits or limit access to certain services to offset the levy’s impact on their finances. This could result in higher out-of-pocket costs for members.
Potential for Tax Credits:
Medical scheme contributions are generally eligible for tax credits, which can help offset the cost of the levy. However, any changes to tax credits could affect the net cost of medical scheme cover.
Scheme Sustainability:
The levy also plays a crucial role in ensuring the long-term sustainability of medical schemes. By funding the regulatory oversight and other functions, the levy helps to maintain the integrity of the scheme and protect members’ interests.
Transparency and Communication:
The CMS emphasises the importance of transparency and communication regarding the levy and its impact on members. They encourage schemes to inform members about the levy and the reasons for contribution increases, as well as to ensure that members understand their rights and options.
CEO’s THOUGHTS
Please be aware of healthcare fraud practices as it remains a significant issue in South Africa, impacting medical schemes, members, and the healthcare industry.
Members play a crucial role in being aware on recognising and reporting fraudulent activities that could compromise their membership and financial security.
Members are encouraged to stay vigilant and report any suspicious activity.
While many may think that fraudulent practices have no impact on them personally, the reality is that if there was no fraud and waste, medical scheme premiums could be significantly lower, as fraud and waste is a major contributor to annual premium increases.
