Discovery offices in Sandton. (Photo: Felix Dlangamandla) 
The Council for Medical Schemes plans to investigate the processes that led to an error in Discovery Health Medical Scheme’s administration – resulting in 16,507 members suddenly being told that they owed the scheme significant amounts of money, up to as much as R80,000.
MediCheck, an independent medical scheme advocacy firm that assists members in disputes with medical schemes, estimates the total value of disputed recoveries to be between R130-million and R170-million, based on the number of affected members and the range of individual recovery amounts reported.
However, Discovery Health placed the value at about R125-million, equivalent to around 0.1% of annual Discovery Health Medical Scheme (DHMS) claims. About R3.6bn in benefits was paid out for the affected members over the course of last year, chief executive Dr Ron Whelan told Cape Talk last week Tuesday.
Discovery Health told Daily Maverick that the error originated after a system update in early 2025, and related to how certain medicine claims (over-the-counter medicine, non-preferentially priced medicine and ethical medicine), accumulated to the Annual Threshold and were paid from the Above Threshold Benefit (ATB). As a result, members reached their ATB thresholds faster, which inadvertently resulted in the scheme paying for some medicines and services that should have been covered by these members.
“We detected the error through routine monitoring by the Discovery Health Drug Risk Team and a single member query from a broker,” the administrator said.
Members’ relief
Daily Maverick reader Lynette (last name withheld to protect her privacy) was among those affected. “I am very relieved that Discovery have decided to take responsibility for their error and found the moral courage to do the right thing,” she said, noting that affected members were placed under unnecessary stress with Discovery Health’s “previous stance requesting (demanding?) that we bear responsibility to pay them back”.
“Let this be a lesson that public outcry and critical feedback and consumer activism together with organisations like Medicheck and the media that have the public interest at heart do make a difference,” she told Daily Maverick.
Mark Hyman, chief executive officer of Medicheck, which represents more than 1,500 Discovery Health members, said Discovery Health's announcement that it would absorb the full cost of a claims processing error rather than pursue recoveries from more than 16,500 Discovery Health Medical Scheme members, was welcome.
“The (Discovery Health) decision follows a week of intensive engagement by MediCheck on behalf of affected members who faced recovery demands – in some cases exceeding R80,000 – for an administration error they did not cause,” he said.
“Our members were facing significant financial pressure over an issue that was entirely outside their control, which is why we lodged the issue with the Council for Medical Schemes. This outcome ensures no member is financially prejudiced by Discovery’s systems failure,” Hyman said.
Members across certain executive, comprehensive and priority plans where the above threshold benefit (ATB) applies were those affected.
Timeline of events
⏳Early January 2026: Discovery notifies 16,507 members of recovery demands.
⏳5 January: MediCheck issues formal dispute notice and demands for substantiation.
⏳6 January: Discovery CEO, Dr Ron Whelan is interviewed by John Maytham on Cape Talk.
⏳6 January: Discovery requests a meeting with MediCheck.
⏳7 January: MediCheck issues urgent cease-and-desist notice as deductions begin.
⏳9 January: Emergency meeting between Mark Hyman and MediCheck counsel advocate Lewis Rosen and Discovery executives. The Council for Medical Schemes also met Discovery Health on this day.
⏳11 January (11h30): Discovery announces full reversal.
In a statement issued on Monday, 12 January, the CMS said it would “proceed to enquire into the error that led to the overpayments with the view of strengthening governance in order to prevent a recurrence.”
The good news
● All affected 16,507 members are released from any repayment obligation. Their claims statements will be updated to reflect this decision.
● Deductions already made from medical savings accounts, personal health funds or HealthPay accounts will be reinstated.
● Members who have already repaid amounts will receive full refunds.
● There will be no impact on any member’s 2026 benefits.
Hyman pointed out that under the Medical Schemes Act, the Board of Trustees is responsible for ensuring proper control systems. “When a systemic error of this magnitude occurs across an entire benefit year, members deserve answers about what went wrong and what safeguards are now in place,” he said.
It is important to note that the funds belonging to a medical scheme are essentially a pooled benefit, and the scheme does not make a profit. However, the administrator is a separate entity which does make a profit. The Discovery Health medical scheme is administered by Discovery Health, the administrator. The administrator turned a profit of about R4.3-billion for the year to the end of June 2025. The error was on the part of the administrator, and it is the administrator that will now absorb the costs.
CEO of Discovery Health (the administrator) Dr Ron Whelan said: “Notwithstanding the validity of the recovery, having carefully listened to members’ concerns and considered their individual experiences and circumstances, Discovery Health has decided to cover the cost on members’ behalf.”
The affected group represents 10.5% of the members on those plans, and less than 0.6% of the scheme’s total membership. There is no impact on members outside this group, and benefits for 2026 across all plans remain completely unaffected.
“We apologise unreservedly to members affected by this error. Covering this cost is the right decision, one that reflects our commitment to fairness, integrity and putting members first, especially when we fall short,” Whelan concluded.
How the Above Threshold Benefit works
The day-to-day claims that members send to Discovery Health are added up, and when they reach a fixed rand amount (the annual threshold), claims are paid from the Above Threshold Benefit.
The annual threshold amount is set at the beginning of each year, and depends on the number and type of dependants (adult or spouse or child) on your plan.
Certain claims, such as those for Schedule 0, 1 or 2 medicine, are not paid for once in the ATB.
When you enter your ATB, your medical expenses are covered at the applicable Discovery Health rates according to your plan type, subject to certain annual limits. DM