The National Health Insurance (NHI) Act was signed into law by President Cyril Ramaphosa on 15 May 2024, marking a significant milestone in the country’s journey toward universal health coverage and a unified health system. This signals a significant policy shift aimed at addressing disparities in the healthcare sector by moving toward universal healthcare access. The rationale for NHI is clear when examining the current allocation of resources.
Importantly, the money used for medical scheme comes exclusively from private funds, contributed by members, some of whom also pay taxes. Which means that medical scheme members are already contributing to the public health system through general taxation.
| Public sector | Private sector | |
| Number of lives | 53m | 9 m |
| Percentage of population | 85% | 15% |
| Funding source | Taxes allocated to Health Budget | Medical scheme contributions |
| Amount | R248bn (2023) | R232bn (2023) |
The table above highlights that resources in the South African healthcare system are concentrated in the private sector, while the majority of the population have to be treated by the overstretched public sector which cannot cope.
The NHI represents a transformative but highly complex reform aimed at addressing South Africa’s deeply inequitable healthcare system. However, challenges around funding, legal hurdles, workforce sustainability, governance, and the role of private healthcare providers must be carefully managed to ensure successful implementation. Until these issues are resolved, private medical schemes remain a critical component of healthcare access for many South Africans.
The implementation of NHI in South Africa is currently underway in a phased approach, with Phase 1 having started in 2023 and continuing until 2026, followed by Phase 2 from 2026 to 2028.
Current status of NHI implementation
- Phase 1 (2023–2026) focuses on foundational reforms, including drafting regulations, appointing committees, and beginning the integration of public and private healthcare sectors.
- Phase 2 (2026–2028) will continue these reforms, with full implementation expected to take up to 15 years in total.
Key challenges impacting NHI implementation
- Legal challenges and constitutional concerns
Multiple legal challenges have been launched against the NHI Act, questioning its constitutionality, especially regarding provincial authority and the president’s decision-making process in signing the bill into law.
Organisations such as the South African Medical Association (SAMA), Board of Healthcare Funders (BHF), Hospital Association of South Africa (HASA), and Discovery Health have raised concerns about the Act’s provisions and financial feasibility.
Some legal cases argue that the NHI Act infringes on rights related to private healthcare and that the government did not adequately consider constitutional objections before enacting the law.
- President must hand over records on NHI Bill
In the case where the BHF and the South African Private Practitioners’ Forum (SAPPF) challenge, among others, the procedural aspects related to the signing of the NHI Bill into law, the High Court has recently ordered the President to hand over his record of decision-making regarding the signing of the NHI Bill. The President has, however, filed a notice indicating his intention to appeal the judgment by approaching the Constitutional Court directly, as he believes the High Court is wrong in its ruling. If the Constitutional Court declines to hear the appeal, the matter will be referred to a full bench of the High Court or the Supreme Court of Appeal.
The BHF has also indicated its readiness to file two further challenges to the NHI Act, reinforcing its conviction that not only is NHI unaffordable but also that it will fail to achieve the aim of universal health coverage. The BHF will challenge the public participation process undertaken by the government in developing the NHI Act in the Constitutional Court and will separately challenge the constitutionality of the Act’s provisions in the High Court.
Source: https://www.medicalbrief.co.za/judge-orders-ramaphosa-to-hand-over-records-on-nhi-bill/
- Stakeholder resistance and private sector engagement
There has been significant resistance from private healthcare providers, medical schemes, and industry bodies due to concerns over the impact on private healthcare and medical scheme benefits.
The government’s approach to implementation has been criticised for insufficient stakeholder consultation and ignoring dissenting views, which fuels opposition.
- Financial sustainability and costing issues
The HASA and other stakeholders argue that the NHI lacks a clear and feasible financial plan, with no recent comprehensive cost estimates to support its rollout. Reports indicate South Africa’s current fiscal constraints make it difficult to raise sufficient funds through taxes or borrowing to finance the NHI fully. Concerns exist about potential funding shortfalls that could disrupt healthcare access for millions.
- Logistical and operational barriers
The requirement for every South African to register with the NHI before accessing healthcare, including emergency care, poses a major logistical challenge that could restrict access in the short term.
There is a lack of national systems and databases to manage patient records and healthcare access efficiently, risking overburdening centralised complaint and administration offices.
The NHI Act lacks clarity on the exact healthcare services covered, with conflicting definitions and delayed regulations, causing uncertainty for providers and patients alike.
- Capacity constraints and workforce strain
Healthcare professionals are already operating beyond capacity, and the NHI’s accreditation and operational requirements may be unattainable for many, risking workforce burnout and reduced quality of care. The NHI Act does not adequately protect healthcare workers from medicolegal risks under the new system, which could further discourage participation.
- Governance and integration challenges
Effective governance structures and coordination between public and private sectors are essential but remain a work in progress. The complexity of integrating two vastly different healthcare sectors poses ongoing challenges for policy coherence and operational efficiency.
Closing remark
While South Africa demonstrates strong political commitment to achieving universal health coverage through the NHI, the implementation faces substantial hurdles. Success will depend on addressing these issues through transparent stakeholder engagement, robust governance, clear service definitions, and sustainable financing strategies. The current reality is that medical scheme remains one of the few practical ways for South Africans to secure timely, high-quality healthcare and protect themselves against catastrophic medical costs. However, rising premiums and anticipated public sector budget cuts threaten to undermine this safety net, making the need for systemic reform more urgent than ever. As the country moves toward NHI, the role of medical schemes and the sustainability of both public and private healthcare will be central to ensuring that all South Africans can access the care they need – regardless of income or status.
Health Insights – July 2025