THE Treatment Advocacy and Literacy Campaign says more time is needed for a proper public consultation on the proposals to introduce the National Health Insurance policy, including a full cost-benefit analysis.
TALC national director Felix Mwanza said the NHI was ill-suited to the present-day social and economic context in Zambia and introducing a scheme that starts with the formal sector first would be harmful for equity.
Mwanza said the government should seek to engage stakeholders in a participatory process to finalise and implement a comprehensive Health Financing Policy for the health sector before going ahead with implementing the National Health Insurance.
He said while NHI had worked to achieve universal health coverage in a number of high-income countries, attempts to replicate the same kind of employment-based models in low and middle-income countries had proved unsuccessful.
“In developing countries NHI schemes are typically characterised by large-scale exclusion, and the bigger the informal sector the bigger the coverage gap. Ten years after the introduction of NHI schemes in Tanzania, coverage had reached only 17 per cent. Kenya’s National Hospital Insurance Fund – established nearly 50 years ago – today insures only 18 per cent of Kenyans. Low levels of enrolment have been reported as a major and recurring challenge in a number of other countries, including Vietnam, Ghana, and Nigeria,” Mwanza said.
He said in high-income countries, several structural features had provided a positive enabling environment for NHI, including: large formal sectors, low poverty rates, small family sizes, and strong government capacity to administer and regulate insurance funds.
“Crucially, these enabling factors are absent in the Zambian context. Yet even rich countries struggled to achieve rapid scale up via NHI – it took Germany 127 years to achieve universal health coverage,” Mwanza said.
He said unaffordable insurance premiums would exclude the majority of citizens.
“Under current plans, the majority of Zambians who are not in formal sector employment will be required to pay an annual premium to join the NHI scheme. Nearly two-thirds of all Zambians live below the national poverty line and in rural areas 58 per cent live in extreme poverty. Even if premiums are subsidised many ordinary Zambians will be excluded,” Mwanza said.
He noted the government plans to exempt certain categories of people from paying premiums such as the poor, children and elderly.
Mwanza, however, said it was unlikely that the subsidies would be sufficient to cover all those unable to pay and that it was not clear how ‘the poor’ would be identified.
“The difficulties of applying exemptions for certain groups of people are well documented internationally. In Zambia’s own experience, exemptions that should have protected the poor from being charged user fees did not work. Before user fees were removed a national exemption policy was designed to protect the poorest sections of the population but this was largely ineffective in reaching the majority of the eligible population,” he said.
Mwanza said under current proposals, Zambia’s NHI scheme would be voluntary for the majority population in the informal sector who represent up to 80 per cent of the population.
He said the 2010 World Health Report unequivocally stated that “it is impossible to achieve universal coverage through insurance schemes when enrolment is voluntary.”
“No country in the world has achieved anything close to UHC using voluntary insurance. This is because when membership is voluntary the rich and healthy opt out and there is insufficient funding to cover the needs of poor people and those who are sick. Voluntary schemes typically suffer from low coverage, adverse selection, and risk pools that do not support cross-subsidies from rich to poor or from the healthy to the ill,” Mwanza said.
He said in countries that have introduced NHI, hopes that insurance premiums from the informal sector would raise additional revenue for health have not been realised.
He said a public health insurance scheme in Zambia would be beneficial for citizens who can afford to join but there was a very real danger that such a scheme would exclude the majority of people and leave the poor behind.
“As the biggest single employer of formal sector workers, the government will be spending a significant amount of money on employer contributions. In 2012, the Government of Zambia spent K6.4 billion on salaries. Using this figure and a 2.5 per cent employer contribution rate, it is estimated that the government would be spending K160 million each year on employer insurance contributions. This is money that could be used to train and employ more health workers, build health posts in rural areas, and buy life-saving medicines. K160 million is enough to pay the annual salaries of more than 2,500 doctors. Using government resources to subsidise better health services for an already privileged group is fundamentally unfair and undermines the core principles of UHC,” he said.
Mwanza also said charging premiums at a flat rate was regressive.
“If the annual premium for those outside of the formal sector are charged at a flat rate (e.g K100 per person per year), this will make NHI a highly regressive way of funding health care as poor people will contribute a higher proportion of their income than wealthier people,” he said.
Mwanza said existing entitlements to free health care might be scaled back.
“At the moment all citizens are entitled to free primary health care. Because Statutory Health Insurance only covers people who are enrolled, there is a question over what would happen to non-members and their entitlement to free health care after NHI is introduced – it could mean the reintroduction of user fees for people who are not enrolled in the scheme,” said Mwanza.