Financial burden of Health Insurance in Nigeria: the path to universal health coverage

Health insurance involves the strategic purchase of healthcare services through the payment of premiums in anticipation of a health need.

Image credit: CANVA

Health insurance in Nigeria is fast becoming vogue and is widely accepted, with many individuals realizing its need and making efforts to get insured. The National Health Insurance Scheme (NHIS) Act (2005) was recently repealed and has become the National Health Insurance Authority (NHIA) Act 2022. The weight of the repealed act mandates that all residents of Nigeria should be insured as regards their health.

The state social health insurance agencies were equally kick-started in almost all thirty-six states of the federation two years ago to help push health insurance to the state civil servants and grassroots community.

Health in Nigeria is expensive for the average individual, as the minimum wage in Nigeria is N30,000 ($40) per month, which means the least-paid worker should have a take-home pay of the aforementioned amount. This is however not the case for very low-income earners, who may earn as little as N10,000 ($13.5) per month.

One would wonder: is healthcare service cheap in Nigeria? It is a big no. I will attempt to give some examples. Here in Kwara State, where I am a resident, the minimum amount to have a folder in a standard private hospital is N5000 ($7) for a single individual and could be as high as N15,000 ($20) for a family folder. To see a consultant in a private hospital will cost an average of N10,000 ($13.5) and as much as N50,000 ($67.5) in states like Lagos. These amounts do not have investigations and treatments included, and in a country where health conditions are rampant, an individual may fall sick at least once a year.

Before I go deeper into some analysis of the cost of health insurance in Nigeria, I must state that I am a medical doctor employed as a manager at the National Health Insurance Authority (NHIA). The Government of Nigeria has purchased strategic health insurance for employees and enrollees through the NHIA, who are required to pay 10% ONLY on drugs prescribed within the NHIA benefit package and tariff. This is very laudable, as enrollees can afford to pay token amounts to get treated and even undergo surgical interventions as contained within the benefits package.

There is provision for individuals, families, and groups who wish to purchase health insurance by paying an annual fee as it may relate to the category of choice through the GROUP, INDIVIDUAL, AND FAMILY SOCIAL HEALTH INSURANCE PROGRAMME (GIFSHIP) under the NHIA. The minimum for an individual or family of three is N45,000 ($61) per year, which must be renewed. The Health Maintenance Organizations (HMOs), though regulated by NHIA, are also in the business of purchasing health insurance, most especially for private individuals, groups, and private organizations, with varying packages and amounts. By implication, if an individual’s contribution is for the least expensive package, that person will have limits on what he or she can benefit from in terms of healthcare services. There are other packages that are also comprehensive but have higher costs for people who can afford them. Thus, in the private business of health insurance, the coverage is dependent on the package an individual or group of individuals can afford.

During the course of the discharge of my duties as a staff member of NHIA, the majority of people who have come to purchase health insurance are people who needed the insurance urgently to alleviate the financial burden of a health need, which is termed “adverse selection,” and the management of NHIA has equally put in place measures such as a prolonged waiting period for surgical interventions. It is only a few people that purchase health insurance for the purpose of curbing huge financial implications in the future when a health need arises.

These indices reveal that the purchase of health insurance by the average Nigerian who is not under the employment of the Federal Government is a little costly, but it serves as a great cushion in the face of a health challenge. The new NHIA Act 2022 has made health insurance mandatory for all Nigerians with the motive of achieving universal health coverage (UHC), and the Authority has intensified efforts to ensure health insurance is mandatory for all Nigerians.

The Government of Nigeria needs to invest more in the health sector especially human capital resources so as to ensure the healthcare services delivered are of standard quality. The provision of necessary equipment in the health sector can not be overemphasized. And overall, health insurance should be affordable to the average Nigerian. The fear of exorbitant cost of health has costed many lives and health conditions to be poorly diagnosed or missed.

Thank you for reading. I would love your comments and contributions 🤗

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