Parliament, Wednesday, 29 April 2026 – The Portfolio Committee on Health expressed concern over the systemic weaknesses in the Council for Medical Schemes (CMS)’s ICT infrastructure when it received a briefing from the entity on its 2026/2027 annual performance plan and budget for the 2026/27 financial year.
Committee members highlighted that the entity’s reliance on outdated, 20-year-old IT systems poses a barrier to effective service delivery. Furthermore, the committee told the entity to urgently prioritise upgrading its ICT platforms to improve efficiency and protect sensitive data.
The chairperson of the committee, Ms Faith Muthambi, questioned the entity's preparedness to respond to cyber-attack as the cyber-attack is real and happening. She asked the entity about its seriousness regarding ICT requirements amounting to 61 million that are not funded.
In its response, the CMS conceded that the outdated platform had already contributed to a decline in its complaint resolution target from 85% to 75% and confirmed its commitment to upgrading the IT infrastructure, currently working with CITA to finalise the procurement process for a new IT platform provider within three months.
The committee also expressed concern about the CMS’s reliance on levy increases for revenue especially in light of under-performance in areas such as accreditation fees and interest income. The committee stressed that the revenue model which is levy-dependent needs urgent reassessment.
The CMS outlined its turnaround strategy, which includes a collaborative project with the Department of Health aimed at repositioning levies that have not been adjusted beyond the Consumer Price Index (CPI) for two decades, despite rising legal costs and increased workloads.
Ms Muthambi told the entity that its strategy must address high budget allocation to employees. The committee heard that approximately 72% of CMS budget is spent on compensation of employees.
The entity told the committee that it employs a highly skilled workforce of professionals essential for its regulatory functions. It said its turnaround strategy includes organisational efficiency reviews to ensure that staff are fully utilised before filling critical vacancies, thereby addressing concerns about potential overstaffing.
The committee also looked closely on consultant expenditures initially reported to be R579.2 million. The entity stated in its response that the actual consultant budget is R4 million.
In challenging the expenditure, Ms Muthambi said: “We have asked you to appraise us on the funds that have been set aside for the use of consultants in the current financial year. We want transparency.” She instructed the CMS to break the funds so that the committee can see whether there is value or not in the transfer of skills. The entity reiterated that the budget covers essential services such as outsourced internal audits, appeal board fees, and human resource policy reviews.
The committee stressed the importance of ensuring that consultancy services provide tangible value for money and that skills are effectively transferred to in-house staff.
Legal expenses by committee members was another crucial point that it questioned the entity about. In their response, the CMS reported that 16% of its budget is dedicated to legal fees due to ongoing litigation, which includes 12 ongoing cases, nine of which are in the High Court.
The committee heard that the CMS is working to internalise legal functions and exercise stringent controls on expenditures related to senior counsel, aiming to mitigate rising costs.
The committee asked about the delay in introducing standardised low-cost benefit options (LCBO) and the progress of the primary health care package review. Members highlighted the critical nature of these initiatives to ensure that all South Africans have access to affordable healthcare.
The CMS reported that its 2023 LCBO report which was submitted to the Department of Health indicated that current LCBOs often provide inadequate coverage and do not sufficiently address Prescribed Minimum Benefits (PMBs) which potentially exposes members to high out-of-pocket costs.
Waiting periods in medical aid schemes for new members was an area of concern that the committee raised and felt it was unfair practise. The CMS explained that waiting periods are necessary to prevent anti-selection, where individuals might join a medical scheme only when they need immediate medical attention. Members stressed the importance of clear and proper communication of these policies to members to avoid confusion.
The committee also focused on regulatory enforcement, specifically addressing two medical schemes that failed to maintain the required solvency ratio. Ms Muthambi criticised the procedural updates, demanding immediate and specific details on the actual interventions taken by the CMS.
The CMS addressed the problem of alleged racial discrimination against black medical practitioners (known as Section 59 issues), which involves unfair targeting through fraud algorithms and delayed payments.
The entity referenced the Minister of Health’s three proposals: establishing an independent judicial/investigative panel for justice; creating a universal legislated code of conduct, and forming a forward-looking tribunal for disputes. The CMS further reinforced this commitment by emphasising its own proposal for separating roles, to ensure that medical schemes do not act as the referee, player, investigator, and judge.
ISSUED BY THE PARLIAMENTARY COMMUNICATION SERVICES ON BEHALF OF THE CHAIRPERSON OF THE PORTFOLIO COMMITTEE ON HEALTH, MS FAITH MUTHAMBI.
For media inquiries or interviews with the Chairperson, please contact the committee’s Media Officer:
Name: Yoliswa Landu (Ms)
Cell: 081 497 4694
E-mail: ylandu@parliament.gov.za
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