Discovery Health has hiked its membership contributions for 2025, reflecting rising healthcare costs.
Effective January 2025, contributions for its high-end plans — the Executive, Classic Comprehensive, and Classic Smart Comprehensive — will increase by 11%. For the Coastal Saver and Coastal Core plans, members will see a 10.9% rise, bringing the total contribution for a main member on the Executive plan from R10,303 to R11,430.
Core and Priority plans will experience a 10% increase, while the widely popular Saver plans will have a more modest 8.4% escalation.
The lowest increase, 7.4%, is reserved for the cost-effective Smart plans, which have grown rapidly since their 2016 launch, now covering over 200,000 members.
Discovery’s latest financial results underscore the company’s capital resilience and cash generation capabilities.
Reporting its first full-year results under the IFRS 17 Insurance Contracts standard, Discovery grew its normalised profit from operations by 17%, driven by strong contributions from its South African operations and Vitality Global, which saw growth of 16% and 57%, respectively.
However, Vitality UK posted a 14% decline, mainly due to claims experience in VitalityHealth and adjustments in the back book under VitalityLife.
The Group’s embedded value increased to R110 billion, representing a 13.2% return on embedded value (RoEV). Strong organic cash generation, with a 66% cash conversion rate, and improved financial leverage further reinforced its robust financial standing.
Discovery SA’s overall performance was buoyed by growth across multiple segments, with Discovery Bank, Life, Health, Invest, and Insure all reporting strong or improved metrics.
Discovery’s ability to maintain capital and liquidity strength, even raising R1.5 billion in debt ahead of the upcoming SA elections to mitigate refinancing risks, reflects its prudent financial management and preparedness for future challenges.
Discovery’s chief executive, Adrian Gore, has cautioned that rolling out the National Health Insurance (NHI) Act in its current form could severely damage South Africa’s economy and cause the loss of billions in business value.
During Discovery Day, Gore expressed concerns about the new laws, which were approved just ahead of the 2024 elections but have yet to be enforced, calling them a “problematic piece of legislation” that is both draconian and impractical.
He stressed that the scheme is unlikely to succeed without private sector involvement, yet the laws largely exclude major contributors like medical aid providers.
As stipulated, medical aids would be barred from funding any services covered by the NHI, only offering complementary plans. However, there’s significant ambiguity around which services the NHI will cover.
“We have been unequivocal as business, as Discovery, and as a sector, that the NHI is unworkable without private sector collaboration,” said Gore.
“There is just not enough funding available if the NHI is imposed in a draconian form that excludes private medical aids.”
The group's share price has climbed around 12% in the year-to-date, to around R160.
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