Policy Brief October, 2012 Why are states not adopting the formal sector programme of the NHIS and what strategies can encourage adoption? About the authors Key Messages: State governments have a reasonable level of interest in establishing financial The research presented in this risk protection measures. policy brief was conducted by Chima Onoka, Obinna Onwu- Though states are interested in the formal sector social health insurance pro- jekwe, Benjamin Uzochukwu gramme (FSSHIP) of the NHIS as one of such measures, concerns about the un- and Nkoli Ezumah. The re- clear role of states in the programme have affected their interest in adoption. searchers are part of the Health Undefined accountability systems and the absence of financial reports of activi- Policy Research Group, College ties carried out for the FSSHIP created distrust amongst actors and constrained of Medicine, University of Nige- adoption. ria, Enugu. The decision for adoption has also been affected by the feasibility of executing the policy design with regards to employer and employee contributions. For further information about Despite general agreements about the adequacy of the benefit package, discon- this study, please contact: tent about capitation rates and an unrevised drug list created apathy towards Chima Onoka adoption amongst health care providers. [email protected] [email protected] Introduction Purpose The need to reduce the burden The National Health Insurance Scheme (NHIS) in Nigeria was launched in 2005 as part of of health care payments to indi- efforts of the federal government to achieve universal coverage with financial risk pro- viduals and protect them against tection mechanisms. However, six years after the launch of the programme, only 4% of the financial cost of healthcare the population (mainly federal government employees), are covered by health insurance led to the establishment of a and this is mainly through the formal sector social health insurance programme (FSSHIP) National Health Insurance of the NHIS. In addition, only three out of thirty-six states in Nigeria - Bauchi (2008), Scheme (NHIS) in Nigeria. Cross River State (2007) and Enugu (2010) - had adopted the programme, suggesting the existence of constraints to adoption which need to be identified and addressed. This policy brief looks at factors that may have enhanced or con- Based on a comparative case study carried out in two states in Nigeria, this policy brief strained adoption of the formal presents the reasons why different state (sub-national) governments have either sector social health insurance adopted or not adopted the NHIS FSSHIP, and identifies strategies that may encourage programme (FSSHIP) of the adoption and enhance universal coverage goals. NHIS by states in Nigeria. Key Actors involved in adoption M e t h o d s In-depth interviews: 48 In-depth inter- views were conducted with state level National Health Insurance Focus states: Two states (Enugu and Ebonyi) actors including policy makers and Scheme (managers) with similar, political, geographic, and cultural other key actors that were or should State government (key state characteristics were chosen. Enugu had have been involved in the adoption level policy makers) and its adopted the FSSHIP, while Ebonyi had not. process. employees (civil servants) Health maintenance organiza- Document review: State health sector policies, Data were analysed within and across tions (managers) plans, and health financing documents, and cases, and the outcome was discussed Health care providers (doctors laws and guidelines for NHIS programmes. at post study workshops with actors. and pharmacists) Pa ge 2 Onoka, Onwujekwe, Uzochukwu, Ezumah September, 2012 FINDINGS: ENUGU STATE (FSSHIP WAS ADOPTED) Evidence of state Funds free maternal and child health (MCH) ser- government’s inter- vices (state-wide using public facilities) ROLES PLAYED THAT ENHANCED est in financial risk No medical allowance for civil servants though ADOPTION protection measures previously requested by them Leadership provided by state gov- ernor Concerns about role Government initially considered setting up a Advocacy visits by NHIS and en- of states in the state level health insurance scheme to retain gagement with state technical FSSHIP contributions at state level. committee responsible for adop- tion Also attempted to set up direct contracts with HMOs rather than sending funds to the NHIS Enlightenment workshops carried out by HMOs for civil servants to (seen as a federal government establishment). gain advantage during HMO selec- The need to take advantage of the technical tion process capacity for managing insurance considered Exclusion of providers (though lacking in the state but available in the NHIS, unintentional) from the process overshadowed concerns about absence of state seemed to enable adoption role in governance of the scheme and conse- quently enabled adoption. Undefined account- Accountability issues were not raised during the “I can tell you honestly, having ability systems adoption process. interacted with many of them (policy makers and NHIS officials) during our Feasibility of execut- Government was willing to make employer con- (advocacy) visits, the main person there ing the policy design tribution is the governor. If the governor should wake up today to say, ‘I’m doing this with regards to em- Civil servants considered employee contribution rate reasonable but wanted payment deferred thing (adopting the programme), let ployer and employee to allow them time (at least a year to benefit me just take the risk,’ he will do it. The other policy makers and the NHIS have contributions from the programme) to be convinced about their limits. They will only send actor commitment to implementation. proposals, make recommendations; but Civil servants also felt they would not be asked it is left with the big man to adopt it. If to contribute in the long-run because federal he says the government does not have employees were allowed not to contribute money to do it, there is nothing you can since inception of the programme in 2005, do.” which implied that employer contribution was (HMO manager) sufficient for the FSSHIP. Concerns about capi- Doctors reported having frequent conflicts with tation rates and drug dissatisfied federal employees (existing benefi- “You can’t give me 550 naira, and expect list ciaries) for two main reasons: low capitation and an unrevised schedule of drugs (since me to go and pay a pharmacy when 2005), which made patients to buy unlisted someone buys drugs there. So, it’s faulty drugs out of pocket. that you lump everybody and everything Pharmacists were unwilling to support adop- inside, and you call it global capitation. tion because of their opposition to the Global Nobody wants to release the one he has”. capitation strategy being used (which was con- (Medical union leader, Enugu) sidered not to be in their favour). About case studies: Case studies are preferred when "how" or "why" questions are being posed, and when the focus is on a contemporary phenomenon within some real-life context. Multiple case studies enable comparisons between two or more case units with similar or different contexts and thereby help facilitate generalization. Why are states not adopting the formal sector programme of the NHIS and what strategies Pa ge 3 can encourage adoption? FINDINGS: Ebonyi state (FSSHIP was not adoptded) Evidence of state Provides about US$100,000 monthly directly to public ROLES PLAYED THAT MAY HAVE government’s in- and non-profit private facilities to enable them deliver CONSTRAINED ADOPTION terest in financial free maternal and child health (MCH) services for house- risk protection holds in rural areas who the governor believes have a Leadership for adoption was greater share of the financial consequences of ill health. provided by the ministry of measures health rather than the governor Medical allowance (10% of basic salary paid to civil ser- Minimal advocacy visits by NHIS vants monthly to help defray health care expenditure). because of unwillingness of the state government to release Concerns about The independent establishment of the FSSHIP by the fresh funds for employer contri- role of states in federal government made it a federal programme, and bution the FSSHIP the requirement for states to transfer contributions to Enlightenment workshops for the federal level, made the scheme unappealing. civil servants were not carried The law establishing the NHIS did not specify a govern- out by HMOs because of uncer- ance role for states apart from their broad inclusion as tain outcome of such invest- employers of labour. ments Health care providers did not Civil servants and policy makers had previous negative support adoption experiences with a contributory federal led programme (National Housing Fund) - they made contributions, were yet to enjoy the benefits and could not retrieve their funds. “With the closed system of NHIS Undefined ac- Concerns that the NHIS had not presented any audited where information about its countability sys- financial and operational report to the state or the gen- operations is not available to the tems eral public since its inception, created distrust towards public, and the Nigerian factor (the the scheme and an unwillingness to release state funds assumption amongst Nigerians that to the NHIS. non- transparency of a system is a Providers, HMOs and civil servants were also unaware of consequence of the existing internal any such report. corruption), it is