Public clinics and medical aid

The public health sector, made up of state clinics and hospitals, serves most of the population. The private sector is funded mainly through medical schemes. Statistics South Africa’s General Household Survey 2025 put medical aid membership at about 15.5% of South Africans, the same as in 2024, with the highest share in the Western Cape at about 25.9% and the lowest in Limpopo at about 8.2%.

That spread means two hires in the same role can arrive with very different starting points. One may already belong to a scheme through a spouse or an earlier job; another may have relied on public facilities. Ask before you design a benefit.

National Health Insurance: law, but not in force

The National Health Insurance (NHI) Act, intended to create a single national fund, is law but is not in force. News reports from February 2026 say the President agreed not to proclaim any section of the Act until the Constitutional Court rules on challenges to how it was passed. The court heard those challenges on 5 and 6 May 2026.

For planning, that leaves public facilities and medical schemes as the system to work with today. If a ruling or a later proclamation changes the position, revisit the benefit then.

How medical schemes work

Medical schemes are non-profit funds, registered and supervised by the Council for Medical Schemes (CMS) under the Medical Schemes Act 131 of 1998. Every benefit option a scheme offers must cover the prescribed minimum benefits (PMBs): any emergency, about 271 defined conditions, and 26 chronic conditions on the chronic disease list.

The CMS explains that PMB treatment is paid in full at the scheme’s designated service provider when the scheme’s protocols are followed, while a co-payment may apply at other providers. Claims have to be submitted within four months, and the CMS handles member complaints about PMB claims.

Schemes may also apply waiting periods to new members, and a late-joiner penalty, which is a loading on contributions, for people who join later in life without earlier cover. The penalty rules sit in Regulation 13. For an older hire who has never had medical aid, find out how this would apply before you make an offer.

Schemes, insurance products and international plans

South African law keeps medical schemes and medical insurance apart. According to a parliamentary reply, products such as gap cover and hospital cash plans fall in a separate category under the 2016 demarcation regulations and are regulated by the Financial Sector Conduct Authority (FSCA), not the CMS.

Only registered schemes may do medical-scheme business. Section 20(1) of the Medical Schemes Act says no one may carry on the business of a medical scheme unless registered as one, and government news reports describe the CMS going to court against unregistered entities.

An international plan that is not a registered medical scheme would not earn the medical tax credit described below. In practice an international plan for a South African hire either takes the place of local medical aid or tops it up, and that choice changes the tax result. Whether an offshore plan may be offered to a South African resident is a point for the insurer to settle.

How SARS taxes employer contributions

The South African Revenue Service (SARS) says that when an employer pays medical scheme contributions for an employee to a registered scheme, the payment is a taxable fringe benefit. SARS also treats those contributions as made by the employee, so they count toward the employee’s medical scheme fees tax credit.

That credit applies only to contributions to registered medical schemes. Payments for medical insurance products do not earn it, so the same budget can carry a different after-tax value depending on what you fund. A tax professional who knows South African payroll can model the difference for your hire.

Payroll duties and the hiring route

Accounting-firm guidance lists the statutory payroll duties an employer in South Africa carries as unemployment insurance (UIF), the skills development levy (SDL) and workers’ compensation under COIDA. Practitioner guidance from accounting firms says a non-resident employer usually still has to pay UIF and SDL for employees working in South Africa.

The same practitioners say an employee working from home in South Africa does not by itself create a permanent establishment for a foreign employer. Accounting firms also describe PAYE amendments from 2024 under which non-resident employers that do have a permanent establishment must register with SARS and withhold PAYE, with a resident representative taxpayer needed for registration.

With those duties in view, some US companies weigh a local entity or an employer of record (EOR) as the employer. Our page on health coverage for EOR staff and contractors abroad sets out who provides cover in each setup.

Requesting an introduction for a South African hire

To start, complete the quote form on this page with the number of people you employ in South Africa, the province each one lives in, whether they already belong to a medical scheme, and which family members you want included. We pass the request to a benefits partner focused on health cover for international and remote staff. Plan options, eligibility and cost are settled by the partner and the insurer.

To review the US side of a hire abroad, such as employment practices liability, see insurance changes for remote teams. Related country pages cover the United Arab Emirates, Israel and India, while the international health insurance overview and the employee benefits hub give the wider picture.

A few useful answers

Common questions

Is National Health Insurance in force in South Africa?

No. The NHI Act is law, but news reports say the President agreed in February 2026 not to proclaim any section until the Constitutional Court rules on challenges to how it was passed.

What must every medical scheme cover?

The prescribed minimum benefits on every benefit option: any emergency, about 271 defined conditions and 26 chronic conditions on the chronic disease list.

Are employer-paid medical scheme contributions taxable in South Africa?

Yes. SARS treats contributions an employer pays to a registered scheme as a taxable fringe benefit, and also as contributions by the employee, so they count toward the medical tax credit.

Does an international health plan earn the medical tax credit?

The credit applies only to contributions to registered medical schemes, so a plan that is not a registered scheme would not earn it.

What payroll duties apply when a US company employs someone in South Africa?

Accounting-firm guidance says a non-resident employer usually still pays UIF and SDL. One with a permanent establishment must register with SARS and withhold PAYE, and an employee working from home does not by itself create a permanent establishment.

International Health Insurance for Remote Employees in South Africa