Government has allocated N$3.189 billion to the Public Service Employees Medical Aid Scheme (PSEMAS) in the 2026 Appropriation Bill, accounting for 25% of the Ministry of Finance’s total budget, as pressure mounts on the cost of public healthcare.
Finance Minister Erica Shafudah said the allocation reflects the Scheme’s central role in government spending and its importance in supporting public servants.
“PSEMAS remains central to safeguarding the welfare of public servants and contributes to the stability and sustainability of the domestic healthcare financing system,” she said.
The allocation comes after PSEMAS expenditure reached N$4.21 billion in the 2025/26 financial year, overshooting its budget by N$659.3 million due to higher-than-expected claims.
Government is now moving to tighten controls and contain rising costs through a series of structural reforms.
An amount of N$7 million has been set aside for coding structure services aimed at standardising claims processing and improving service provider identification. A further N$2.25 million will fund actuarial and technical advisory services to strengthen cost modelling, risk assessment and long-term sustainability.
In addition, N$2.5 million has been allocated for the development of an integrated Member and Claims Management System, while N$1.5 million will go towards a Claims Verification Dashboard designed to strengthen pre-payment controls, reduce fraud and improve clinical and financial oversight.
Shafudah said government has stepped up efforts to address inefficiencies within the scheme, including the establishment of a multi-stakeholder governance committee in March 2026.
“Government has continued to implement targeted reforms to strengthen governance, efficiency and financial sustainability of the scheme through stakeholder engagement and new oversight structures,” she said.
PSEMAS currently covers 309,158 beneficiaries, including 145,823 principal members and 163,335 dependants, making it one of the largest healthcare schemes in the country.
The reforms, set to take effect in the 2026/27 financial year, signal a shift towards stricter cost control and improved accountability as government moves to stabilise one of its fastest-growing expenditure items.
