The High Court in Pretoria has shut down Sizwe Hosmed’s boardroom comeback attempt, appointing Ian Fleming as curator of the medical scheme with immediate effect.
In a statement issued after the judgment on 10 February and confirmed on 11 February, the Council for Medical Schemes (CMS) assured members, healthcare providers, employer groups, and industry stakeholders that the scheme remains stable, compliant, and fully operational.
The order, confirmed on 11 February, cancelled the appointment of Lebogang Grace Mpakati in terms of section 5(9) of the Financial Institutions (Protection of Funds) Act and installed Fleming in her place, in line with earlier curatorship orders granted on 4 September and confirmed on 9 October 2025. Mpakati has been directed to hand over all documents and equipment within 30 days and to submit a final report to the Registrar of Medical Schemes within the same timeframe.
The decision marks the latest turn in a protracted regulatory battle over a scheme whose solvency unravelled after its 2021 merger.
From merger to meltdown
When Sizwe Medical Fund and Hosmed Medical Scheme merged in November 2021, the combined entity reported reserves of R1.4 billion and a solvency ratio of 49.4%. Within a year, solvency had dropped to 25.45%. By mid-2025, it had fallen below 7% – far short of the 25% statutory minimum required under the Medical Schemes Act.
In August 2024, the CMS placed the scheme under statutory management in terms of regulation 29(2), citing “the deterioration of financial reserves”. Joe Seoloane was appointed as the scheme’s statutory manager.
At that stage, the regulator and the board jointly ran the scheme in an effort to stabilise it.
Read: Medical scheme placed under statutory management as reserves plummet
Regulatory reporting pointed to under-pricing of benefits, unreliable forecasting, high claims ratios, elevated non-healthcare expenditure, and governance weaknesses as contributing factors.
When statutory management failed to reverse the decline, the Registrar approached the High Court for curatorship. A provisional order was granted in September 2025 and confirmed the following month.
Read: High Court confirms curatorship of medical scheme
The Court held that once a curator is appointed, the board no longer has legal standing to act on behalf of the scheme, describing the earlier order as “clear and unambiguous” in vesting control in the curator.
Stabilisation – and fresh controversy
Under curatorship, Mpakati reported progress in restoring provider access, stabilising claims payment runs and implementing governance corrective measures. A 19.15% contribution increase was introduced from 1 November 2025 to address historical under-pricing. She attributed the financial strain partly to high non-healthcare costs and duplicate payments.
Membership, however, continued to decline, including the loss of members affiliated to the South African Local Government Association.
Read: Sizwe Hosmed making substantial progress, says curator
In early February 2026, the former board returned to court seeking to rescind the curatorship and remove Mpakati.
According to Business Day, Registrar Dr Musa Gumede opposed the application and cited alleged irregularities at the scheme, including duplicate claims payments, procurement concerns, and alleged misuse of a corporate credit card by a former principal officer.
The administrator, 3Sixty Health, and the former principal officer denied the allegations, the newspaper reported.
Business Day further reported that Gumede agreed Mpakati was no longer fit to hold office after a provisional sequestration order was granted against her estate in December 2025, along with a provisional liquidation order against her business rescue firm.
He stated in court papers that she had declared in 2023 there were no pending legal matters affecting her fitness to serve and had informed the CMS only in January 2026 of the December judgment.
He argued the findings called her fitness and propriety into question. Mpakati told the newspaper the matter was unrelated to her curatorship and said she would abide by the court’s decision.
Members assured of stability
In a media statement released this week, the CMS assured all members, healthcare providers, employer groups, and industry stakeholders of the ongoing stability, sustainability, and regulatory compliance of Sizwe Hosmed.
Gumede framed the outcome of the judgment delivered on 10 February as a necessary regulatory intervention.
“Our foremost responsibility is to safeguard the interests of members and to ensure that every medical scheme under our jurisdiction remains stable, well governed, and financially resilient,” he said.
“The regulatory measures applied to Sizwe Medical Scheme are part of our proactive oversight framework and are designed to strengthen not disrupt its operations. Members can be assured that the scheme remains functional, stable, and capable of meeting its obligations.”
The CMS said the change in curatorship leadership was undertaken strictly within its statutory mandate and should not be interpreted as instability, but as part of normal regulatory processes aimed at strengthening governance and ensuring long-term sustainability.
The regulator said it continues to apply rigorous monitoring mechanisms to ensure strong solvency and liquidity levels, prudent financial management and reporting, effective governance, fiduciary discipline, member-centric service delivery, and sustainable claims-paying ability. Oversight measures – including real-time financial surveillance, governance reviews, and mandatory reporting – function as early-warning safeguards.
Members were assured that benefits remain secure, claims continue to be paid in the ordinary course, and services remain uninterrupted. The regulator said it would continue to communicate transparently as regulatory processes unfold.
Fleming, who previously served as curator of Thebemed Medical Scheme, now assumes control as the CMS maintains close oversight.
Forensic findings in the spotlight
In motivating for continued curatorship, Gumede also relied on two forensic reports that had not previously been made public, Business Day reported.
The first, by TFS Africa Forensics, allegedly identified potential duplicate claims exceeding R522 million and flagged more than 245 000 stale claims totalling R81m that were paid between July 2023 and February 2024. Claims older than four months are generally considered ineligible.
According to the newspaper, 3Sixty chief executive Khandani Msibi said the administrator had not seen the TFS report and rejected allegations of duplicate payments of more than R500m. He said a previous KPMG review had reduced an earlier duplicate-claims estimate from more than R300m to R17m.
A second report, by Phandahanu Forensics, allegedly raised concerns about misuse of a corporate credit card by a former principal officer, including personal travel and traffic fines, Business Day reported. The former principal officer denied wrongdoing, said he had submitted receipts for about R1.1m in expenses and that charges against him had been withdrawn in 2024. “I remain dedicated to upholding the highest governance standards,” he said.
The report also allegedly flagged irregularities in the appointment of a service provider for scheme elections and payments made without supporting contracts.
A pattern of red flags
Long before the court battles, regulatory data had pointed to structural weaknesses.
The CMS 2022 Industry Report showed Sizwe Hosmed recorded the fourth-highest operating deficit among open schemes. Its claims ratio stood at 99.02%, well above the industry average of 93.11%, despite a younger-than-average membership profile.
Healthcare expenditure per beneficiary was R2 232.22 per month, compared to an industry average of R1 860.68. Non-healthcare expenditure was R268.57 per beneficiary per month versus an industry average of R229.60. Administration costs and marketing spend were materially above peer levels. Trustee remuneration and executive pay also exceeded industry norms.
A separate CMS research report on AGM expenditure described overall spending patterns as “worrisome” and noted that Sizwe Medical Fund had an “extreme value” relative to a benchmark ratio.
Taken together, the solvency slide, cost pressures, governance concerns, and forensic allegations formed the backdrop to the regulator’s insistence on sustained external control.
With Fleming now in place, the focus shifts from courtroom battles to operational repair. The question is no longer whether the regulator will intervene – it has. The test is whether the scheme can rebuild financial resilience and governance credibility after years of compounding strain.
