Undermining risk pooling by individualizing benefits: the use of medical savings accounts in South Africa

Abstract

South Africa has a dual health system in which the majority of the population is covered by the public health care sector and 16% of the population with higher incomes is covered by voluntary private health insurance delivered through medical schemes. Medical savings accounts (MSAs) were first introduced by medical schemes in 1994 and their usage grew rapidly in the first decade but declined in the second decade. By 2005, MSAs covered 88% of open scheme beneficiaries and 49% of restricted1 scheme beneficiaries but by December 2014 MSA coverage had declined to 67% of open scheme beneficiaries and 18% of restricted scheme beneficiaries. This chapter focuses on MSAs, but more information on medical schemes and private health insurance can be found in Chapter 12 in this volume.