The future of Sizwe Hosmed hangs in the balance after the High Court in Pretoria last week placed the medical scheme under provisional curatorship.
The Registrar of Medical Schemes brought the urgent application for the provisional curatorship order on 3 September. The Court granted the Registrar’s request for its ex parte application to be heard in camera (not in open court). (“Ex parte” means the application was submitted by one party, without notice to the other party.)
The return date for the Court’s order is 30 October, when Sizwe Hosmed and other interested parties will have an opportunity to state why the rule nisi should not be made final.
The order also ended the statutory management of Sizwe Hosmed, which started in July last year.
The difference between statutory management and provisional curatorship is that with the former, the scheme is run jointly by the statutory manager and the board of trustees. With the latter, the curator replaces the board and works under the direction of the Council for Medical Schemes (CMS).
In its order of 4 September, the High Court appointed Lebogang Grace Mpakati as the provisional curator.
Mpakati will investigate Sizwe Hosmed’s financial position and advise on viable solutions, including the future of the scheme – merger, liquidation, or continued existence, and the conditions under which any option will be implemented, the CMS said in a statement.
The CMS’s latest Industry Report ranks Sizwe Hosmed as the eighth-largest open medical scheme by membership, at 58 269 (at the end of December 2023). It had 138 507 beneficiaries.
The provisional curatorship order is a consequence of Sizwe Hosmed’s long-standing financial and governance problems.
In November 2021, the merger of Sizwe Medical Fund and Hosmed Medical Scheme resulted in the newly formed entity having a solvency ratio of 36.5%. However, a year later, the solvency ratio had dropped to 25.45%, just above the statutory minimum of 25%.
The solvency ratio declined to below 25% early in 2023, and the scheme was required to submit a detailed business plan to the CMS in accordance with Regulation 29 of the Regulations to the Medical Schemes Act.
The CMS said it rejected the first three business plans – submitted in February 2023, April 2023, and October 2023 – because they contained inadequate information, as well as inaccurate forecasts and assumptions compared with the actual experience.
The fourth business plan – submitted in September 2024 after the scheme had changed its actuaries – was approved in December 2024.
The scheme was placed under statutory management in terms of section 5A(1)(a) read with sub-section (2) of the Financial Institutions (Protection of Funds) Act, effective from 11 July 2024.
The statutory manager, Joe Seoloane, was tasked with ensuring that Sizwe Hosmed complied with the law, became financially sound, and was properly administered.
Although Seoloane’s reports to the CMS noted “some slight improvements”, his June 2025 report concluded that the scheme was in a poor financial state, and remedial action was essential, the CMS said.
Seoloane’s report of August 2025 concluded that the scheme “was facing severe financial and operational distress, marked by critical solvency issues, regulatory non-compliance, member losses, and unsustainable claims”.
The scheme had a solvency ratio of 5.6% in June and 6.62% in July.
The CMS said the significant drop in the solvency ratio and deviation from the budget adversely affected the reliability of the business plan and the scheme’s ability to reach its year-end target and remain technically solvent.
“In order to protect the best interests of beneficiaries, the CMS has had to act swiftly and therefore brought the curatorship application on an urgent basis,” the regulator said.
The South African Local Government Bargaining Council recently informed Sizwe Hosmed that it had not been granted accreditation to market the scheme to local government employees in 2026.
