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CAPE TOWN – The Government Employees Medical Scheme (GEMS), South Africa’s largest restricted medical scheme, entered the 2019 financial year in a solid financial position, with assets significantly exceeding liabilities, as reported in the Scheme’s 2018 Annual Integrated Report that released on Wednesday.

“The Scheme’s financial position provides assurance to members and key stakeholders that the Scheme is sustainable and able to meet its claims and member obligations”, said GEMS Principal Officer, Dr Guni Goolab.

With 1.8 million beneficiaries, GEMS has grown to become the country’s second-largest medical scheme overall with a solid membership base that is exclusively available to all eligible public service employees in South Africa.

“Being prudent while ensuring that members access their benefits is one of our priorities and this ensures that the Scheme is sustainable over the long term and able to address member and stakeholder expectations. Specifically in delivering affordable access to quality healthcare services that improve member’s health outcomes,” said Goolab.

GEMS has over the last two years managed to grow its total assets from R5 billion at the end of 2016 to more than R12bn at the close of the 2018 financial year to December. The Scheme reported a reserve ratio of 24.7 percent for 2018, up from 15.2 percent achieved in 2017.

The Medical Schemes Act No 131 of 1998 requires that medical schemes, “shall at all times maintain its business in a financially sound condition” with a statutory requirement of 25 percent of their annual gross income in reserves. “We are proud to be within reach of this important milestone after a long journey of hard work over the years,” said Goolab.

The board approved the five-year strategy, aligned to government priorities, in 2016. The Scheme’s primary goal is to improve affordability and access to quality healthcare for public service employees, while its overarching strategic objective is for GEMS to become an integral part of the government’s National Health Insurance (NHI) policy.

The Scheme offers five benefit options and one efficiency discounted option, such as the Emerald Value option (EVO). EVO continues to perform optimally in terms of its ability to contain cost of care without compromising access to quality healthcare. EVO has reduced the cost of care by 16.4 percent. EVO has saved around R340 million in healthcare costs since its inception, and R227 million in hospital expenditure.

“In our pursuit for affordability, the Scheme’s average weighted contribution increase for 2019 was 7.09 percent, one of the lowest increases in the medical schemes industry for the year. In addition to the low increase, additional benefits for 2019 valued at R832 million was given back to members,” said Goolab.

The Scheme aims to add more members on its entry-level Sapphire benefit option, which provides out-of-hospital care, such as visits to a general practitioner, dentist and optometrist; maternity care at private facilities; and in-hospital cover at public and selected procedures at private facilities. In 2018, the percentage of GEMS members subscribing to this option was 7 percent at year-end.

GEMS’ non-healthcare costs are significantly lower than those of other schemes in the industry, representing a saving for members of about R1.5 billion a year. This means that compared to other schemes, GEMS makes a larger percentage of member contributions available for healthcare funding.

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