Nigeria’s health insurance system has been grappling with significant challenges that have rendered it largely ineffective, Juliet Jacob observes as she reports in this write up, the challenges of health insurance and how to make it work better.
Burden of Accessing Medication in Nigeria
Despite concerted efforts over the past two decades, coverage remains alarmingly low, with only about 8-10% of the population insured.
This limited coverage predominantly includes federal employees and their dependents. The key issues contributing to the inefficacy of Nigeria’s health insurance system and ongoing initiatives aimed at addressing these challenges are the stark realities the average Nigerian faces. The initial idea of improving the health of Nigerians through affordable cost of medication is proving hard to implement. Many are dying simply because they cannot afford the cost of wellness in the country. The cheapest drugs/tablets for headaches, cold are not easy reach anymore. For a treatment of a minor itching of the eye, the price of the drug is scarying the average salary earner in the country. The escalating prices of drugs generally coupled with the seeming lack of capacity on the part of the federal government to prioritise health of the citizens have constituted a serious worry for the people.
The anxiety that came with the introduction of the NHIS is waning. Ordinarily, an excellent plan, being that with health insurance, more people can access necessary medical services, including preventive care, which can detect and treat health issues early, and emergency care for serious conditions. Improved access leads to better health outcomes and longevity.
The National Health Insurance Scheme (NHIS)
In 1999, Nigeria established the National Health Insurance Scheme (NHIS) under decree 35 of the constitution. However, it did not become operational until June 6, 2005, when it was officially launched, and services to enrollees began in September of the same year.
The NHIS operates through a tripartite arrangement among three main stakeholders: the NHIS, health maintenance organizations (HMOs), and healthcare providers. Additional stakeholders include the enrollees under the scheme.
The primary aim of the NHIS was to achieve Universal Health Coverage (UHC) for Nigerians by 2015 by improving the health of all Nigerians at an affordable cost.
Despite nearly two decades of implementation, less than 5% of Nigeria’s over 200 million population are beneficiaries of the scheme. This low coverage is a significant barrier to achieving UHC.
Challenges of NHIS
The NHIS has notably failed to cover the majority of Nigerians, particularly the unemployed (33% of the population) and the self-employed 81.37% of the total employed.
Coverage among artisans is a mere 3.4%. Furthermore, dissatisfaction with services and issues with healthcare providers’ remunerations have been reported.
The NHIA Act
To address these challenges, the National Health Insurance Authority (NHIA) Act was signed into law on May 19, 2022, by President Muhammadu Buhari. This Act repeals the existing NHIS Act and aims to promote, regulate, and integrate health insurance schemes, enhance private sector participation in healthcare, and achieve UHC for all Nigerians.
Key Provisions of the NHIA Act
Management and Accountability
The Act places fund management under state health insurance schemes instead of HMOs, aiming to prevent misuse and embezzlement and ensure better accountability and quality healthcare delivery.
Enhanced Health Packages
The NHIA Act expands healthcare packages to include treatments for cancers, emergency care, and stroke management, reducing financial burdens from unforeseen medical conditions like road traffic accidents.
Awareness and Uptake:
The Act emphasizes increasing awareness about health insurance, addressing one of the significant shortcomings of the NHIS, to boost participation in health insurance schemes.
Low Enrollment and Coverage
The National Health Insurance Scheme (NHIS), now the National Health Insurance Authority (NHIA), has struggled to attract substantial enrollment. As a result, about 90% of Nigerians lack health insurance coverage. Dr. Michael Obi, a health policy expert, explains, “The low enrollment rate underscores the system’s inability to reach the vast majority of the population, particularly those in rural areas.”
Funding and Budget Allocation
Nigeria allocates a small percentage of its budget to healthcare, significantly less than the 15% agreed upon in the Abuja Declaration. This inadequate funding results in under-resourced public health facilities. “Without sufficient financial resources, the system’s capacity to provide quality healthcare services is severely hampered,” says Dr. Amina Bello, a public health specialist.
Awareness and Cultural Barriers
A significant lack of awareness about health insurance persists, particularly in rural areas. Additionally, cultural beliefs sometimes discourage people from enrolling in health insurance schemes, as some view reliance on medical care as a lack of faith. These barriers significantly impact the willingness and ability of individuals to participate in health insurance programs.
Operational Inefficiencies and Corruption
The NHIS has faced several operational challenges, including bureaucratic delays and corruption, which undermine trust in the system. Many healthcare providers prefer dealing with private Health Management Organizations (HMOs) due to their more efficient administrative procedures. This preference further exacerbates the public system’s inefficiencies.
Private Sector Challenges
While private HMOs are flourishing, they primarily cater to corporate clients and urban populations, leaving the informal sector and rural communities underserved. This focus on profitability over coverage further limits the reach of health insurance, contributing to the overall low coverage rate.
Exclusion of Primary Health Care (PHC)
Primary health care providers, crucial for rural health services, are often excluded from the NHIS. This exclusion limits accessibility for rural dwellers, who rely heavily on PHC providers for their medical needs.
Ongoing Efforts to Improve Health Insurance
Despite these challenges, efforts are underway to improve the system. The introduction of the NHIA Act in 2022 aims to make health insurance mandatory and improve governance and efficiency. The Act also seeks to establish a fund for vulnerable groups, which could potentially increase coverage if effectively managed.
Implementation of the NHIA Act
The National Health Insurance Authority Act mandates that all Nigerians must enroll in health insurance plans, aiming to provide comprehensive coverage. Ongoing efforts include addressing stakeholder concerns regarding the operational guidelines of this act, which involves refining roles and responsibilities and resolving funding issues for vulnerable groups.
Strategic Purchasing of Health Services
Strategic purchasing involves making informed decisions on fund allocation to prioritize services, select providers, and establish payment mechanisms that promote efficiency and equity. This approach aims to enhance the impact of the health budget by ensuring resources are used effectively to provide equitable access to essential health services.
Funding and Budget Allocation
Stakeholders are advocating for increased health sector funding. There are calls to allocate 15% of the national budget to health, aligning with the Abuja Declaration, to reduce out-of-pocket expenditures and improve overall health outcomes. “Increasing the health budget is crucial to reduce the financial burden on families and improve service delivery,” emphasizes Dr. Samuel Onwuegbu, an economist specializing in health financing.
Public-Private Partnerships
Collaborations between the government, private sector, and international partners are crucial. Partnerships like the one between CarePay and MTN Nigeria leverage technology to improve the distribution and administration of health insurance products, making them more accessible and efficient.
Awareness and Education Campaigns
Increasing awareness about the benefits of health insurance is essential, especially in the informal sector. Efforts include community sensitization programs to educate people on the importance of health insurance and how to enroll. “Education campaigns can bridge the knowledge gap and change cultural perceptions about health insurance,” says health advocate Ngozi Umeh.
Technological Innovations
Utilizing digital platforms for health benefits management can streamline processes and enhance transparency. Platforms like CarePay provide seamless transactions between patients, providers, and insurers, which can increase enrollment and improve service delivery.
The Benefits of Effective Health Insurance
Effective health insurance can significantly improve the standard of living for Nigerian citizens through several key benefits.
Financial Protection
Health insurance reduces the financial burden of medical expenses on households. It prevents catastrophic health expenditures that can push families into poverty. By spreading the cost of healthcare across many individuals, insurance ensures that individuals are not faced with large, unpredictable medical bills.
Improved Health Outcomes
Health insurance facilitates timely medical intervention, reducing morbidity and mortality rates. Regular check-ups, vaccinations, and early treatment of diseases contribute to a healthier population, decreasing the incidence of severe health conditions.
Economic Productivity
A healthier population is more productive. When citizens are not burdened by illness or the financial stress of healthcare costs, they can work more efficiently and contribute more to the economy. This boosts overall economic growth and development.
Social Equity
Health insurance promotes social equity by ensuring that all segments of society, including the vulnerable and marginalized, have access to healthcare. This reduces disparities in health outcomes and ensures that everyone has the opportunity to lead a healthy life.
Enhanced Quality of Life
With access to comprehensive healthcare, individuals can maintain better health, which enhances their quality of life. They can engage in social activities, education, and employment more effectively, leading to a more fulfilling life.
Mental Health Benefits
Knowing that health insurance can cover medical expenses reduces stress and anxiety related to potential healthcare costs. This financial security contributes to overall mental well-being.
Factors and Agencies Hindering Success
Several agencies and factors have been identified as holding back the success of health insurance in Nigeria’s economy.
Moving Forward
Addressing the challenges facing Nigeria’s health insurance system requires coordinated efforts across federal and state governments, regulatory bodies, private sector participants, and civil society. By improving governance, increasing funding, raising awareness, and streamlining operations, Nigeria can move towards achieving effective and widespread health insurance coverage, ultimately improving the standard of living for all its citizens.
