Original Research

Private hospital expenditure and relation to utilisation: Observations from the data

Marine Erasmus, Helen Kean
South African Journal of Economic and Management Sciences | Vol 21, No 1 | a1658 | DOI: https://doi.org/10.4102/sajems.v21i1.1658 | © 2018 Marine Erasmus, Helen Kean | This work is licensed under CC Attribution 4.0
Submitted: 02 September 2016 | Published: 29 March 2018

About the author(s)

Marine Erasmus, Econex, Stellenbosch, South Africa; Department of Economics, Stellenbosch University, South Africa
Helen Kean, Econex, Stellenbosch, South Africa


Background: This study contributes to the detailed understanding of the drivers of medical scheme expenditure on private hospitals in South Africa over 2006–2014. This is important in the context of various regulatory reforms that are being considered at present.


Aim: The aim is to provide an updated analysis and description of the drivers of medical scheme expenditure on private hospitals in South Africa.


Setting: Private hospital market, South Africa.


Methods: Data from the three largest private hospital groups – which account for approximately 70% of the South African private hospital market share – are collected, aggregated and analysed. This study uses targeted descriptive and exploratory analyses, relying on a residual approach to hospital expenditure.


Results: It is found that over time medical scheme beneficiaries, on average, are being admitted to private hospitals more frequently, as well as staying in hospital for longer during each admission. The data also indicate that over time older people are being admitted to hospital more often.


Conclusion: This study’s findings contradict previous assertions that it is only prices driving increased medical scheme expenditure on private hospitals.


private hospitals; South Africa; utilisation; price; medical schemes; ageing; admissions; health market inquiry


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