Dan-Fulani: Health Insurance Scheme Will Minimise Catastrophic Expenses


The Programme Manager, Federal Capital Territory’s Health Insurance Scheme, Dr Ahmed Dan-Fulani in this interview with Ebere Nwoji, at the recent second World Health Organisation’s Africa Regional Office Health Forum held in Praia, Cape Verde recently, spoke on the relevance of health insurance scheme to Nigerians, the need for all states in Nigeria to adopt the scheme, among others. Excerpts:

What is your assessment of level of penetration of health insurance scheme in Nigeria?

First of all, let me give you the background of National Health Insurance Scheme (NHIS). The NHIS, was established by the former president Olusegun Obasanjo. The target that time was the formal sector mainly the federal government workers. The plan was that government will be in part and the workers will also be in part to benefit. However, 20 years down the line, the coverage of NHIS is still very poor.

Recent statistics put the penetration at less than four per cent of the National population being covered. Because of that, government now introduced the State Social Contributory Health Insurance Scheme which targets the increase in the coverage of the health insurance scheme. But presently, the coverage of health insurance scheme is still below five per cent and we are looking forward to improvement through the Contributory State Social Health Insurance.

When was the State Health Insurance introduced?
Yes, if you are aware of National Health Act of 2014, part of the National Health Act, especially section 11 of the Act, created one percent of consolidated government revenue to be used for health and this was provided for in 2018 budget as about N25 billion was earmarked and based on that, many states are now encouraged to set up their own Social Health Insurance Scheme because the one percent consolidated revenue is used for what they call Basic Health Care Provision Fund.

The Basic Health Care Provision Fund is going to have two parts. One part is going to be given to the National Primary Health Care Development Agency to improve on the primary health care centres while the other part, about 50 per cent is going to be given to the National Health Insurance to be used in various states of Nigeria to give health care free at no cost in different parts of Nigeria including rural areas. So because of this money that is allocated, many states are now going to benefit from it. As I am talking to you, about 12 states are already working very hard in order to benefit from that. For you to benefit, the state, first of all must have a state agency, must have a law backing it, and must set up some committees that will be used to monitor disbursement of funds in various states. Like I said, 12 states are already warming up to benefit from that and that may also increase the penetration of health insurance scheme in Nigeria.

So in the state social insurance scheme, are the people not expected to contribute?

Well, for the Basic Health Care Provision Fund, nobody is expected to contribute any fund it is going to be free, however that is just a small aspect of health insurance scheme in Nigeria. We have so many other aspects. Even under the NHIS, there are different programmes, at the most of the state health insurance, there are different programmes too. Some of the programmed are for the formal sector, under the formal sector, you are talking about the public servant and organised private sector, they will contribute money and they must pay into a pool that will be used to run health insurance in Nigeria. The other programme is the community based health insurance scheme, it also requires that the people in the rural area, the very poor people will pay a counterpart sum, so small and the government will pay the balance for them, and then there are other programmes for the poor and vulnerable, pregnant women, the disabled and all kinds of categories of people that will benefit from that programme.

Who manages the funds released by the government under the state social insurance?

The fund is domiciled with the federal ministry of health and it is in a Treasury Single Account (TSA) with the Central Bank of Nigeria. However, like I said, 45 per cent of that money will be given to the National Primary Healthcare Development Agency while 50 per cent will be given to NHIS. The remaining five per cent will be used for emergency treatment in Nigeria.

You are working under FCT Health Insurance Scheme, when did you take up this position and what is your experience like?
The FCT Health Insurance scheme, has been working for the past ten years. As I speak to you, now we have more than 150,000 enrolees in the scheme, and we have started rolling out some other programmes. Just a week before I left for this health forum, i introduced the retiree Social Insurance Scheme, I introduced it for those that are retired from the service for them to benefit from health insurance. We are also bringing on board the area council enrolees that is the equivalent to local government, state so we want to take all of them, presently 100 per cent of staff of Federal Capital Administration are on the programme, and we are now going to look at the area council and then we are also starting the Community based Health Insurance Scheme, so all of these are presently ongoing.

One of the reasons health insurance is not popular is that people don’t really understand it, can you talk about how it works?

You see, insurance, whether health or whatever, is a risk-pooling business where resources are pooled together in case a member of that pool has any risk so the total money will be used to service the people who need the service at that particular time. In health insurance, it has been noticed that not up to 20 per cent of the people that are insured will actually go to the hospital at the same time to take service and it is the money of the remaining 80 per cent people that will be used for these 20 per cent and so if you contribute N15,000 per annum, you know that N15,000 per annum cannot take care of you. For example, you need to have surgery, you have a child to deliver or major illnesses that requires treatment, that you are admitted and N15000 cannot do that and you can do that more than once a year.

So it is because of that pooling effect of all the money paid that we can now have enough money to take care of you when you are sick when you just pay only N15,000 as premium. So I am sure that when many people understand the fact that it is a risk pooling business that entails other people insured sharing on your risk so they will understand it more and then log onto it. Besides, everywhere in the world where you see them having a standard health care system, it is basically health insurance, there is no government that gives free health and there is no citizen that can pay out of pocket for all the health care he or she needs so the necessary thing to be done by any country is Social Health Insurance Scheme.

What is the relationship between the government, contributors and the hospitals you use?

Ok, in every system, including insurance, there is what we call the regulatory body. In this case, the National Health Insurance Scheme is the regulator for the national body. Whereas the state social health insurance scheme like my own that is the FCT health Insurance, we regulate all the insurance schemes in FCT for health, under this scheme, we have what we call the Health Maintenance Organisation (HMO), the HMO will be the one to supervise the services in all the hospitals that give the healthcare. We call them the healthcare providers. Now those that pay money to enjoy the services are called the enrolees. An enrolee will be allocated to the hospital, the HMO will now supervise the hospitals to see that they are given good services, payment is also made through the HMO to the healthcare providers, once you put your money in a pool, the regulatory body will now disburse this money to the HMO for onward transmission to the healthcare provider. There are three types of payments being made called the premium, the premium is the amount you pay to enjoy the services, however when we are paying to the healthcare provider, we have the capitation fee for service and administrative charges that is being paid to the HMOs the capitation covers the primary care, while the fee for service covers the secondary care and administrative charges is used by the HMO to run the services on their own.

So what advantages does an average Nigerian stand to gain for keying into the programme
You know like I said, what we do in Nigeria is what we call out of pocket expenses for treating our health care needs. This will cause serious financial destruction to every family, something you don’t expect they just wake up and say go and bring 50,000 or 100,000. It is going to be so strenuous for families in Africa even in Nigeria. The World Health Organisation calls this catastrophic expenditure, when you spend more than 10 per cent of your income on health, we call it catastrophic expenditure and to minimise this or ensure there is no out of pocket expenses that is why the health insurance is established. Now, with health insurance, whether you have money or not you can walk into a hospital and expect services and you can enjoy emergency healthcare services anywhere you are in that particular state or part of the country, once you registered into the health insurance. You only need to present your card to any hospital and you can enjoy the emergency services without paying a kobo. So those are the advantages that are inherent.

If someone doesn’t work with public sector and wants to key into the health insurance, what will such a person do?

Yes, like I said, in health insurance, we have the formal and informal sector, the formal sector is the public sector, also under the formal sector, there is organised private sector. Any company that employs more than 10 people even though they are not government, they are called formal sector and is grouped under what you call organised private sector. Now, for example your company, I’m sure you have more than 10 people in your company so you re organised private sector and you are supposed to enjoy social health insurance. Now under the informal sector, any business that employs less than 10 is informal sector and other individuals who don’t want to register only themselves are under informal sector, the artisans, labourers, mechanics are referred to as the informal sector. Under the informal sector, we have the community based health insurance scheme where the scheme is being taken to rural areas for the poor and the needy, rural dwellers and farmers. So we called it the community based insurance scheme, it is also under the informal sector. So depending on your category as I have mentioned before so you can join the health insurance scheme, it is open to everybody.

So one can look for any HMO and register?
You don’t look for an HMO, you will first of all identify an agency, for example you are in Lagos State, you should look for the Lagos state agency for the health insurance scheme, they will register you and then allocated you to HMO, the current practice where HMO enrol people is what we call the private health insurance scheme, that is private enrolment where the HMO directly sources for enrolee and manage their healthcare.

Is there a limit to the illness that can be treated under the health Insurance scheme?

Yes, there is what we call benefit package, there are different benefit packages for different programmes that I have mentioned to you, but basically what you need to understand is that there is what we call exclusion and services that are not under the health insurance, services like the treatment of cancer, transplant, cardiac transplant and other critical illness are not under the health insurance. There are limitations to what you can do.

Is it determined by the quantum of premium being paid?
Yes, premium can also determine but under the social health insurance, we are trying to shy away from that, we have a level playing ground for anybody who is joining us, however if you join the private HMO, you can pay some premium that will give you a much more wider services than you get under social health insurance.

So how will you rate FCT participation?
I told you it has been very wonderful, because now not until recently, we have the highest number apart from national health insurance, we have the highest number of public enrolee, We have covered the territory 100 per cent, whereas many states are still struggling for that and we are already into community based health Insurance scheme, we have been to about 33 communities and like I told you we are already enrolling the retired people, the retirees, the local government staff, this is not what every state is doing presently so I will put us on a very high scale.