The Supreme Court of Appeal (SCA) has ruled against the Road Accident Fund (RAF) in a case about Road Accident Fund medical aid deductions, interdicting the fund from cutting compensation on the basis that a claimant’s medical scheme has paid or will pay their medical expenses. The judgment, handed down on a Friday and reported by Moneyweb on 16 October 2026, came in an appeal brought by Discovery Health.
What the SCA ordered
The SCA set aside and replaced a December 2024 full bench judgment of the High Court in Pretoria. That judgment had dismissed Discovery’s application for an order declaring the RAF in breach of an earlier court order.
In its place, the SCA declared that the RAF and its former chief executive, Collins Letsoalo, are in breach of a judgment handed down by Judge Mandla Mbongwe on 27 October 2022. It also found them in breach of their constitutional duty to obey and implement that judgment.
The court interdicted the RAF and Letsoalo, with immediate effect, from giving effect to two directives issued on 13 April 2023 and 2 November 2023. They must take all steps needed to comply within 14 days and report their compliance in writing to the court registrar and to Discovery’s attorneys. Costs were awarded against both the RAF and Letsoalo.
Judge Tati Makgoka wrote the judgment. Judges Caroline Nicholls, Phillip Coppin and Esther Steyn concurred, as did acting judge Fiona Dippenaar.
How the dispute began
The fight dates back to 12 August 2022, when the RAF’s chief claims officer issued a directive telling staff to reject claims for past medical expenses that a claimant’s medical scheme had already settled, according to Moonstone’s timeline of the dispute. Discovery went to court, arguing the directive was unlawful and discriminated against medical scheme members, who pay the same fuel levies as other road users.
On 27 October 2022, Judge Mbongwe set the directive aside and barred the RAF from relying on it to reject these claims. In his judgment he listed the likely consequences had the directive stood. Schemes would lose reimbursement for past medical expenses and might have to raise premiums to stay sustainable. Members would pay the RAF fuel levy but might not receive full compensation after being injured by a negligent driver. Schemes might also exclude motor vehicle accident claims, forcing members to pay upfront and claim later.
The RAF then tried to appeal. According to Moonstone, the SCA dismissed its application for leave to appeal on 31 March 2023, finding no reasonable prospects of success. The Constitutional Court refused the RAF’s application on 18 October 2023, saying the matter did not engage its jurisdiction.
The later directives
Discovery’s case was that the RAF kept the breach going through new directives. The first was dated 13 April 2023. Moonstone reports that it required staff to check whether claims fell under Prescribed Minimum Benefits or Emergency Medical Conditions, with only claims outside those categories to be considered. Moneyweb reports that Discovery also alleged a “phantom” directive of the same date, which the RAF had not disclosed, concerning medical schemes’ obligations to provide prescribed minimum benefits for emergency treatment under the Medical Schemes Act.
The directive of 2 November 2023 relied on section 19(d)(i) of the Road Accident Fund Act, which limits compensation where claimants have agreed to pay third parties part of what they receive, per Moonstone. The SCA’s reasoning went to the heart of that provision. Under a medical aid agreement, the scheme pays the claimant’s medical expenses and, when the claim settles, the member repays the scheme. The court held that this repayment is not the same as sharing in the claim proceeds, so such an agreement falls outside the scope of the provision.
Moonstone reports that the High Court ruled against Discovery in December 2024, with Judges Dunstan Mlambo and Noluntu Bam in the majority and Judge Ingrid Opperman dissenting. The SCA has now reversed that outcome.
What it means for schemes and members
Moneyweb notes that Discovery previously said medical schemes carry an irrecoverable loss of about R500 million a year when the RAF does not pay members’ past medical expenses from road accidents. That figure is Discovery’s own and has not been independently verified in the reports we reviewed. Employers who fund medical aid for staff have an interest in the outcome, since Judge Mbongwe warned in 2022 that unrecovered costs could push scheme premiums up.
The immediate test is the 14-day compliance deadline. The reports we reviewed do not say how the RAF plans to respond, and neither the RAF nor Letsoalo is quoted in them. For more on rules affecting business, see our Regulatory and Policy coverage.
