The poor performance of medical schemes has put pressure on payments made to providers such as Life Healthcare. The group’s share price has plunged 22.45% in the past six months and has been in decline for the past three weeks. Gryphon Asset Managers analyst Casperus Treunicht said this was because pressure in formal employment was negatively affecting medical schemes, which in turn reduced payments from the insured pool to healthcare providers. "We know that Discovery and Bonitas are doing this and now we are also hearing rumours coming from the GEMS [Government Employees Medical Scheme]," he said. Council of Medical Schemes data show there was a 0.06% decrease in the number of beneficiaries in schemes between 2014 and 2015. In the same period, scheme expenditure on private hospitals increased 9.36%. All healthcare stocks have performed dismally in the past six months, and analysts do not foresee a turnaround for at least another year. Even though Life Healthcare made acquisitions ...

BL Premium

This article is reserved for our subscribers.

A subscription helps you enjoy the best of our business content every day along with benefits such as exclusive Financial Times articles, ProfileData financial data, and digital access to the Sunday Times and Times Select.

Already subscribed? Simply sign in below.

Questions or problems? Email or call 0860 52 52 00. Got a subscription voucher? Redeem it now