The recently passed National Health Insurance Act (NHIA) has new provisions that will help transform Nigeria’s health sector by ensuring an average person is covered with a basic health insurance plan.
ADESIMBO UKIRI, MD/CEO, Avon Healthcare Limited, in this interview with TELIAT SULE appraises the new Act in respect of what HMOs wanted and what they eventually got and how the Act will make the much-awaited difference in the nation’s health sector.
What is your assessment of the new National Health Insurance Authority (NHIA) Act?
The NHIA Act is a welcome development. At Avon HMO, we have always been at the forefront of advocating for improved regulation of the health insurance space. We have been pushing for reforms that will empower the regulator and expand universal health coverage. We sought for legislation that would make Health insurance compulsory for all Nigerians and this new Act did just that.
It is important to acknowledge the current Executive Secretary of the National Health Insurance Scheme (NHIS), Professor Mohammed Sambo who was instrumental in ensuring the passage of the Act. Advocacy for an Act such as this has been on for over 12 years; during this time, we have had various executive secretaries. It is commendable that during Prof. Sambo’s tenure, he made it a focal point and dedicated considerable effort to ensure its passage of the Act.
I do not mean to imply that the act is perfect, but it has helped us as a country, take a huge leap forward from where we were before.
What does the Act mean for Nigerians?
According to the Act, every Nigerian, no matter their income bracket, will have some level of health insurance coverage. It also recognises vulnerable people who cannot make payments of their own by providing for them through the Vulnerable Group Fund. The Act emphasises the Basic Minimum Package of Health Services that will be financed by the Basic Healthcare Provision Fund. This fund, as indicated in section 11 of the National Health Act ensures access to health care for all, particularly the poor, among other things.
The Act has now made it mandatory for all residents in Nigeria to be under the health insurance scheme. There is a federal health insurance scheme, a state health insurance scheme, and there are also private health insurance plans like those offered by companies like ours.
The key thing every Nigerian can rejoice about is that come rain, come shine, so far there is a means of income; there will be an affordable state health insurance scheme to subscribe to.
What does the basic minimum package offer?
It covers primary healthcare services. All the usual health conditions that take people to the hospitals such as malaria, typhoid, respiratory infections, and so on, are covered. It also covers maternal care and delivery.
This is because all over the world, primary care for basic ailments is what makes people visit hospitals the most. If we get primary care right, we will have fewer health cases going into secondary and tertiary stages.
Who under the new Act is supposed to get health insurance scheme?
The Act says every resident of Nigeria is supposed to get a health plan. This includes both employed and unemployed Nigerians, as well as expatriates working in Nigeria. If you are residing in Nigeria, you must get a health insurance plan.
Different stakeholders made their inputs during the formulation of the Act. What did you submit as expectations and what did you get in return when the Act was passed?
Before the Act was enacted, there were consultations with key stakeholders in the Nigerian healthcare system. Every stakeholder group made its expectations known and we all submitted our memoranda during the public hearing
Were all our expectations met? Well, to an extent. We really wanted health insurance to be made compulsory and now it is mandatory so everybody must subscribe to a health insurance scheme.
What we did not expect was that the Act will say, even if you are going to subscribe to private health plan, you must first subscribe to the minimum basic state health plan. That was unexpected.
Something else we had hoped for but did not get was a total separation between the regulator and the operator, just like PENCOM and NAICOM. For the pensions industry, PENCOM is only the regulator; in the insurance industry, NIACOM is only a regulator. They are not operators.
Under the Act, the regulator (NHIA) will continue to also act as an operator. We would have preferred a regulator who only performs regulatory functions, and not a regulator who like us is an operator. I am hoping that in successive revisions of the Act, this will be addressed. We did not exactly get where we wanted to be, but we have progressed.
Another surprise in the new Act is the requirement for a security deposit from HMOs, which is a welcome development if you ask me. This deposit can be used to offset the debts incurred by defaulting HMOs to hospitals that are owed.
You have been a leading voice for the adoption of technology in the healthcare sector. What are your expectations in terms of technology adoption with regard to the new Act?
My expectations are huge. Right now, there is a wide variance in terms of technology adoption among HMOs themselves, and across the hospitals and other healthcare providers within the Nigerian healthcare ecosystem.
The first thing I expect is that there should be standardization and a transition to globally recognised codes for diagnosis, services, and drugs. How can you have an ICT platform that integrates data across the health ecosystem if there is no standardised way of recording the data, such that whatever you say, everyone knows what it represents? That is the only way the data we are accumulating now can make sense.
The second thing is that the data must be available for public good. Anyone that wants to see health data and statistics on Nigeria, especially industry players should be able to see them, while keeping the patient confidentiality in mind. If the data is made available, it will show us whether we are getting better or not.
Another thing I will encourage is that it cannot stop at connectivity within the HMO ecosystem. Rather, it must be within the healthcare system. As I said, my expectation is extremely high.
Hospital performance data is also important. Everyone should be able to access safety records, clinical outcome statistics, and all those kinds of records that will make one know how good a hospital is.
Have the barriers to entry changed?
Not at all. You must still apply to the National Health Insurance Authority. However, I was surprised to see that the share capital was not mentioned. In PENCOM, the capitalisation requirement is N25 billion. The capital requirement for life insurance is N8 billion and N10 billion for general insurance.
Healthcare is more important than housing or cars so why is it so low? It is still N400 million, but I am hoping that some additional guidelines will be issued because it is an industry that needs to be adequately capitalised.
How much is the special fund HMOs are required to set aside as buffers?
The Act only says HMOs will be required to deposit some funds, but the actual amount is not stated. It also states that the Authority will review the level of security deposit.
How much do you foresee as new investment inflows into the nation’s healthcare sector with the passage of this Act?
It is going to be significant. Once the implementation of the Act begins, and most states have their schemes running, and the basic healthcare fund is made available, all these monies will ultimately end up in the hospitals and other healthcare facilities. I am expecting to see additional investments in hospitals because for the first time in a long time, there is going to be an assured form of payment to healthcare service providers. Hospitals’ revenue streams are likely to become more stable.
Also, the more people subscribe to various health insurance schemes, the more assured, significant, and predictable the amounts of payments made to hospitals will become. With payments more or less guaranteed, hospitals will be able to attract
adequate financing from financial institutions. The pharmaceutical arm of the healthcare system will also benefit because payments for drugs are assured.
In summary, there will be a larger pool of funds that the healthcare system can draw from to recruit and retain highly skilled labour, fund purchase of equipment and carry out research. It will also help us stem the brain drain problem in the healthcare system.
The model encapsulated in the new Act, where did we borrow it from?
In a way, it is a bit like what exists in Singapore. The similarities have to do with the fact that in Singapore there are basic healthcare plans that every citizen subscribes to. The basic healthcare plan is offered by the public sector for the citizens to choose from and it is compulsory. In addition, individuals can purchase supplemental private health insurance or get it through an employer if they require additional services.
These are aspects of the Act that inform my drawing similarities to Singapore.
