Medical Aid Glossary

Before applying for a medical aid we highly recommend that you familiarise yourself with the below medical aid terms.


Act 131 of 1998, better known as the Medical Schemes Act, came into effect on 1 February, 1999. All South African Medical Schemes are legally obligated to adhere to the Act and comply with all regulations passed by the Government Gazette.

Acute condition

Is a self-limiting condition which disappears after treatment e.g. appendicitis and tonsillitis.


The healthcare model whereby a fixed amount of money is paid by a managed care organisation to a network of healthcare providers. The opposite of a capitation model is a fee-for-service model.

Chronic condition

Is a condition which has to be treated on an ongoing basis for more than three months.

Chronic Disease List (CDL)

The CDL is a list of twenty-five conditions which may not be excluded by medical schemes.

Chronic illness

Is a life-threatening condition that requires ongoing treatment for a period of over 12 months e.g. diabetes and asthma.

Chronic medication

All medical schemes are entitled to limit the expenses for Prescribed Minimum Benefits by controlling your choice of medication and other treatment procedures. Cover can be limited to certain brands or generic medication.

Claims paying ability

Is the number of monthly claims that the scheme is able to cover with its existing cash and cash equivalents.


A portion of the cost of a procedure for which the member is responsible which can be expressed as a rand amount or a percentage of the total bill.

Community rating

In terms of legislation, all members of a medical scheme option must pay the same contributions and cannot be asked to pay more due to age or ill health.

Continuation membership

Principal members of closed medical schemes are entitled to remain on the scheme after retirement even if the employer no longer pays the contribution. In the event of the death of the principal member, the dependants will still be covered by the scheme.

Contracted out

If a doctor is contracted out, it means that s/he charges fees higher than the NRPL rates set out by the Council for Medical Schemes.

Credit rating

Global Credit Rating (GCR), an international credit rating company, rates a medical scheme’s ability to pay claims or a hospital’s ability to pay for services.


A set rand amount that must be paid upfront by the member for a defined list of procedures.

Designated service provider

A group of medical service providers specified in the fund rules from whom services must be obtained to have unlimited and co-payment free benefits.

Dispensing Licenses

According to the Medicines and Related Substances Control Amendment Act, a medical aid scheme can only pay out medicinal claims if the medicine was dispensed by a medical practitioner with a dispensing license.


Some medical conditions and procedures may be excluded from medical schemes e.g. cosmetic surgery and self-inflicted injuries.

ICD-10 codes

This code is based on a medical diagnosis in terms of an international classification of diseases developed by the World Health Organisation which must be contained on all claims submitted to medical schemes, in terms of the Medical Schemes Act (1998).

Late joiner penalty

The Medical Schemes Act makes provision for schemes to apply a late joiner penalty to members over the age of 35. Depending on the number of years that you have not belonged to a registered South African medical scheme over the age of 35, the late joiner penalty is calculated as a percentage of your monthly contribution and will be added to your monthly contribution. For further information on late joiner penalty, refer to the bottom of this page.

Medical Savings Account (MSA)

A pool of the member’s own money set aside from the contribution for payment of day-to-day medical expenses.

NAPPI codes

National Pharmaceutical Pricing Index (NAPPI) codes are used to provide information about pharmaceutical and surgical products. This includes details about the manufacturer, registration, strength and dosage.

National Health Reference Price List (NHRPL)

The NHRPL is a national pricing system regulated by the Department of Health and the Council for Medical Schemes. Basically, the NHRPL stipulates the rates to which medical aid schemes must adhere in terms of benefit payments. However, medical service providers are not bound by this rate and some thus charge significantly higher rates. In such cases, members are liable for the difference between the provider’s rate and the NHRPL rate.


Hospital admissions for non-essential or non-life threatening procedures need to be authorised by the  medical scheme prior to the member being admitted.

Pre-existing condition

A condition for which a member has received medical advice, diagnosis, care or treatment was recommended within 12 months prior to application for membership to a medical scheme.

Prescribed Minimum Benefits (PMB’s)

The Medical Schemes Act requires that all medical schemes provide cover for the CDL (Chronic Disease List) conditions.

Reference price

The reference price is the highest amount that a medical aid scheme will pay for a type of medicine.

Roll-over Benefits

Unused medical savings that are carried over from one year to the next.

Waiting Periods

When a member joins a medical scheme two waiting periods can be imposed: a three month general

waiting period during which no claims will be paid and/or a twelve month exclusion for cover for preexisting


Standard Medical Aid Underwriting Questions

Medical Aids are strictly controlled by legislation and are no longer allowed to turn down an applicant.

They can only impose the following underwriting.

Category A

  • Members that have not belonged to a medical aid scheme before
  • Members that have allowed more than 90 days break since resigning from their previous medical aid
  • A 3 month general waiting period may be imposed
  • 12 month condition specific waiting periods may be imposed on pre-existing conditions
  • Late joiner penalty may be imposed

Category B

  • Members who have belonged to a previous medical aid scheme for less than 2 years and allowed less than 90 days break since resigning from their previous medical aid
  • 12 month condition specific waiting periods may be imposed on pre-existing conditions that have occurred in the last 12 months
  • Late joiner penalty may be imposed

Category C

  • Members who have belonged to a previous medical aid scheme for more than 2 years and allowed less than 90 days break since resigning from their previous medical aid
  • Late joiner penalty may be imposed

Late joiner penalties

Late Joiner Penalties can be imposed on members over the age of 35. Depending on the number of years that they have not belonged to a medical aid, a Late Joiner Penalty will be added to the member’s monthly contribution. It is worked out as a percentage of the contribution as shown in the table below and is based on the total number of years a member has not been on a medical aid since the age of 35 years.

No. of years applicant was not a member of a medical aid since age 35 Penalty
1 -4 Years 5 %
4 – 14 Years
25 %
15 – 24 Years 50 %
25 Years
75 %

Should you require any further advice, please complete the contact form with your details and we will call you.