12 Things You Didn’t Know About South Africa’s Private Healthcare Giants

12 Things You Didn’t Know About South Africa’s Private Healthcare Giants

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The South African private healthcare industry is among the best in the world, with quality care available through a selection of private healthcare giants that operate hospitals, clinics and medical facilities across the globe.

The South African private healthcare industry is dominated by three major companies, with Mediclinic International, Netcare Limited and Life Healthcare providing South Africans with medical facilities and healthcare that rivals the offering from companies worldwide.

We take a look at 12 things you may not know about South Africa’s three private healthcare giants.

Sources: Moneyweb, BusinessTech, Fin24, BDLive, Leadership Magazine, ITNewsAfrica, TheCitizen.

This is an updated version of an article first published in May, 2016.

On the JSE
Johannesburg Stock Exchange. Photo: moonofthesouth.com

All three listed on the JSE

The three major private healthcare firms in South Africa, Mediclinic International, Netcare Limited and Life Healthcare, are listed on the Johannesburg Stock Exchange (JSE). Medi-Clinic officially started trading on the London Stock Exchange on 16 February 2016.

Private healthcare investments typically yield good returns. Photo: thinkstock

Smart investors trust private healthcare stocks

Investing in the private healthcare industry in South Africa has historically been considered smart due to the low risk presented by high barriers of entry to new participants in the market and the defensive nature of the business.

Mediclinic is the giant among giants – khaleejtimes.com

Mediclinic is the biggest of the trio

Mediclinic is the largest of the three healthcare providers, with a market capitalisation of around $9.68 billion, followed by Netcare with $3.41 billion and Life Healthcare with $2.53 billion. While all three of the companies are large in terms of their capital and financial resources, Mediclinic is almost three times bigger than the second largest, Netcare.

Netcare Greenacres Hospital
Netcare Hospitals operate in South Africa and the United Kingdom – nmbt.co.za

Largest private hospital network in SA and the UK

The Netcare Group operates a wide and varied network of hospitals throughout South Africa and the United Kingdom, boasting the largest private hospital network in both of those countries.

Netcare is responsible for training countless medical personnel in SA. ThinkStockPhotos

Largest private trainer of medical personnel

Netcare also enjoys status as the largest private trainer of emergency medical personnel and healthcare workers within South Africa, while they are an independent service provider to the National Health Service (NHS) in Britain.

The South African rand (Image: JBay News)
South Africans set for big premium increase in 2017 (Image: JBay News)

Medical scheme premiums on the rise

The Council of Medical Schemes (CMS) recently reported that medical scheme contributions increased by around 9% between 2014 and 2015, but this is on the rise as the contribution increases announced by open medical schemes for 2017 is averaging at around 10.3%.

Government wants free medical for all – Thinkstock

NHI proposal could hurt the private healthcare margins

The South African government aims to implement a National Health Insurance (NHI) in future. This will be a government-funded system allowing free medical access to citizens. The proposal of greater access to free medical services and the price reductions that would likely be created would hurt the profitability and margins the private healthcare giants currently enjoy.

businessinsider.com Nelson Mandela
Nelson Mandela spent time at a Mediclinic facility – businessinsider.com

Nelson Mandela was treated at a Mediclinic hospital

Mediclinic was made famous as one of their medical centres helped to treat Nelson Mandela when he was not well in the years before he passed away. The Mediclinic Heart Hospital in Pretoria treated the former South African president.

Life Healthcare - Beacon Bay Hospital
Life Healthcare – Beacon Bay Hospital – bandageer.info

Life Healthcare fined for failing to mention merger plans

Due to a failure to notify the South African Competition Commission regarding a planned merger between Life Healthcare and Joint Medical Holdings (JMH), both groups agreed to pay a fine of around $634,000.

Government looks to regulate high care costs. Photo: Wikipedia

Government wants to regulate high private health care costs

South African Health Minister Dr Aaron Motsoaledi has commented on the need for the cost of private health care in the country to be regulated, in order to improve access for the majority of South Africans. The minister made a submission to the Competition Commission’s Healthcare Market Inquiry this year.

Mediclinic operates in numerous countries. Photo: Wikimedia Commons
Mediclinic operates in numerous countries. Photo: Wikimedia Commons

The sixth biggest hospital group in the world

The Mediclinic Group is the sixth largest hospital group in the world, with an elaborate network of medical centres available throughout the world, including the United Arab Emirates and Switzerland. From an African perspective, Mediclinic Southern Africa has more than 7,600 beds in 52 multidisciplinary hospitals located in South Africa and Namibia.

Ghana Canada Medical Centre
Private healthcare is costly – greenglobalhealth.com

Only 16% of South Africans have access to private healthcare

Looking at South Africa’s total population of around 54 million people, only 8.8 million of those people are part of a medical aid, which means that only 16% of South Africans have realistic access to private healthcare. While anyone who has the money can pay out of pocket for private healthcare, for the most part, medical aid schemes are the primary means of financing private healthcare.