Willingness to Pay for a Contributory Social Health Insurance Scheme: a Survey of Rural Residents in Akwa Ibom State, Nigeria
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ORIGINAL RESEARCH published: 17 June 2021 doi: 10.3389/fpubh.2021.654362 Willingness to Pay for a Contributory Social Health Insurance Scheme: A Survey of Rural Residents in Akwa Ibom State, Nigeria Christie Divine Akwaowo 1*, Idongesit Umoh 2, Olugbemi Motilewa 1, Bassey Akpan 1, Edidiong Umoh 3, Edidiong Frank 4, Emmanuel Nna 5, Uchenna Okeke 6 and Obinna E. Onwujekwe 7 1 Department of Community Medicine, University of Uyo, Uyo, Nigeria, 2 Department of Internal Medicine, University of Uyo, Uyo, Nigeria, 3 Department of Geography and Natural Resources, University of Uyo, Uyo, Nigeria, 4 Obstetrics and Gynaecology, Immanuel Hospital, Eket, Nigeria, 5 The Molecular Pathology Institute, Enugu, Nigeria, 6 Department of Radiology, Nigerian Navy Reference Hospital, Calabar, Nigeria, 7 Department of Pharmacology and Therapeutics, Institue of Health Policy and Research, University of Nigeria, Enugu, Nigeria Background: Health insurance is seen as a pathway to achieving Universal health coverage in low- and middle-income countries. The Nigeria Government has mandated states to set up social health insurance as a mechanism to offer financial protection to her citizens. However, the design of these schemes has been left to individual states. In Edited by: Albert Okunade, preparation for the set-up of a contributory social health insurance scheme in Akwa Ibom University of Memphis, United States State, Nigeria. This study assesses the willingness-to-pay for a social health insurance Reviewed by: among rural residents in the state. Syed Afroz Keramat, Khulna University, Bangladesh Methods: The study was conducted in three local government areas in Akwa Rei Goto, Ibom State, South south Nigeria. It was a cross-sectional study with multi-stage Keio University, Japan data collection using a demand questionnaire. Interviews were conducted with 286 *Correspondence: household heads who were bread winners. Contingent valuation using iterative bidding Christie Divine Akwaowo [email protected] with double bounded dichotomous technique was used to elicit the WTP for health insurance. Multiple regression using least square method was used to create a model Specialty section: for predicting WTP. This article was submitted to Health Economics, Findings: About 82% of the household heads were willing to pay insurance premiums for a section of the journal Frontiers in Public Health their households. The median WTP for insurance premium was 11,142 Naira ($29), 95% CI: 9,599–12,684 Naira ($25–$33) per annum. The respondents were predominantly Received: 16 January 2021 Accepted: 14 May 2021 middle-aged (46.8%), Ibibio men (71.7%) with an average household size of five persons Published: 17 June 2021 and bread winners who had secondary education (43.0%) and were mainly pentecostals Citation: (51.5%). The mean age of respondents was 46.4 ± 14.5 yrs. The two significant Akwaowo CD, Umoh I, Motilewa O, Akpan B, Umoh E, Frank E, Nna E, predictors of WTP for insurance premium amongst these rural residents were income of Okeke U and Onwujekwe OE (2021) breadwinner (accounts for 79%) and size of household (2%). The regression coefficients Willingness to Pay for a Contributory for predicting WTP for insurance premium are intercept of 2,419, a slope of 0.1763 for Social Health Insurance Scheme: A Survey of Rural Residents in Akwa Bread winner income and a slope of 741.5 household size, all values in Naira and kobo. Ibom State, Nigeria. Front. Public Health 9:654362. Conclusion: Majority of rural residents in Akwa Ibom State were willing to pay for social doi: 10.3389/fpubh.2021.654362 health insurance. The amount they were willing to pay was significantly determined by Frontiers in Public Health | www.frontiersin.org 1 June 2021 | Volume 9 | Article 654362 Akwaowo et al. Willingness to Pay for Health Insurance the income of the breadwinner of the household and the size of the family. These findings are relevant to designing a contributory social health insurance scheme that is affordable and sustainable in order to ensure universal health coverage for the citizens. Keywords: contingent valuation, health insurance, rural residents, universal health coverage, willingness to pay, Nigeria INTRODUCTION challenge is how to generate adequate revenue to finance health services from a diversified group of people, without over tasking Universal Health Coverage is a global target that has been the formal sector workers. adopted by all nations, regions and states. The World Health Raising revenue for these schemes become even more Organization defines Universal Health Coverage (UHC) as a challenging because of dwindling government revenue for the means of organizing, delivering and financing health services in health sector and the large huge informal sector, infective tax such a way that ‘all people obtain the health services they need collection system, inefficient formula to calculate the amount to without suffering financial hardship when paying for them (1). It collect (9). It is therefore particularly important to gather reliable combines two attributes: first, everybody is covered by a package information on the amount of money people are willing to pay of good quality essential health services; and second, it provides for a social health insurance scheme. financial protection from healthcare costs, especially at the point In health utility and welfare economics, Willingness to Pay of service delivery (1, 2). Embedded in the definition of UHC (WTP) is the amount in monetary value that a person would be is the idea of protecting people from financial hardships and ready to spend to utilize a healthcare service (10). The concept social inequality. of willingness to Pay WTP for health insurance arises in settings The Nigerian healthcare system is currently undergoing major where access to healthcare is mostly contingent on Out-Of- reforms in health care financing aimed at achieving UHC. The Pocket Spending (OOPS) at the point of service delivery. Even Federal Government of Nigeria has directed all states to set up in insurance-based setting, health insurance schemes must know and run mandatory State health insurance schemes (3, 4). To up front how much they could charge as premium, to ensure their this end, many states of the federation that have launched the financial sustainability (11). statewide scheme health insurance schemes (5). With the passage Several methods of estimating WTP exist. A useful way of the health insurance bill, the National Health Insurance of conceptualizing the measure of WTP is the hierarchical Scheme (NHIS) has the mandate to protect all Nigerians from classification framework. This organizes existing methods of paying for healthcare out of pocket. However, to achieve UHC in WTP estimation based on data collection methods as proposed Nigeria, an effective NHIS implementing the dictates of the bill by Breidert, Hahsler and Reutterer (12). Using this concept, is imperative. there are broadly two approaches to estimating WTP: “Revealed Social health Insurance (SHI) is one of the possible Preferences” (RP) and “Stated Preferences” (SP) also referred to organizational mechanisms for raising and pooling funds to as Contingent Valuation (CV). finance health services, along with tax-financing, private health Contingent Valuation has been widely used to assess insurance, community insurance, and others (6). It improves public preferences through eliciting WTP values (13, 14). access to health services by removing catastrophic health The contingent valuation method (CVM) is grounded in expenditures by pooling funds to allow cross-subsidization welfare economics, with the measurement of consumer surplus between the rich and poor and between the healthy and the sick providing the major theoretical underpinning (14). In order (7, 8). Such schemes have evolved over the years to represent a to ascertain the Hicksian surplus or willingness to pay (WTP) variety of funding mechanisms, voluntary or involuntary, with empirically, the CVM is often employed. It is a survey-based the underlying objective that all people are, or will be over time, hypothetical method of determining economic values on public offered the right to enrolment in at least one type of mechanism goods by obtaining information on individual preferences. It allowing financial risks to be shared (7). This might involve a mix determines what they would be willing to pay for public goods of various forms of insurance funding for some types of health and services when prices are not available. services with others being funded directly from government The CV method assumes that prospective clients are given revenues (9). a detailed description of the product for which they are asked Under the Nigerian national health insurance scheme (NHIS), how much they would be willing to pay for certain goods using the SHI is designed to cover the formal sector and the a bidding game. This bidding game is useful for eliciting WTP informal sector. The formal sector scheme is currently providing in the Nigerian setting as most goods are purchased using the cover for only 5% of the population (9). Setting up the haggling method in the open market (14). Many studies in low informal sector schemes have been challenging because of the and middle income countries have found that the CVM is a diversity of sector which includes the urban self-employed; rural valid technique for valuing the maximum amounts of money community; children under-five; permanently disabled persons; that people are willing to pay for healthcare goods and services prison inmates; tertiary institutions and voluntary participants; (14–19). Most of these studies have attempted to elicit factors and armed forces, police and other uniformed services. The main associated with WTP (20, 21). Frontiers in Public Health | www.frontiersin.org 2 June 2021 | Volume 9 | Article 654362 Akwaowo et al. Willingness to Pay for Health Insurance Some studies on WTP for health insurance have been carried to the West, and the Atlantic Ocean to the South. The capital of out in various parts of Nigeria (14, 22–26).