—FROM NKRUMAH TO HEALTH INSURANCE
The issue of healthcare financing in Ghana has travelled a long and winding road from colonial times through the First Republic under the great Osagyefo Dr. Kwame Nkrumah the founder of our nation through the ‘Cash and Carry’ era under the Provisional National Defence Council (PNDC) and the National Democratic Congress (NDC) Governments both under former President Jerry John Rawlings, to the present health insurance regime of healthcare financing promulgated under the New Patriotic Party (NPP), and is still seeking refinement under the guide of NDC Government of President John Evans Atta Mills, to meet the aspirations of Ghanaians.
Under the First Republic, from the late 1950s up to 1966, when Dr. Kwame Nkrumah’s Convention Peoples’ Party government was overthrown, healthcare financing in Ghana was in line with the Socialist philosophy of Dr. Nkrumah’s CPP Government, and was virtually free as was education and other social services.
Following the overthrow of President Kwame Nkurmah, Healthcare financing in Ghana saw a complete ‘U-Turn’. Under the military-cum-civilian junta- the National Liberation Council (NLC), Ghanaians were asked to pay for their healthcare.
The 1966 military coup-d’etat was to set in motion a series of coups leading to political instability of the country, which in turn led to economic deterioration until 1981 when Flt Lt. J. J. Rawlings came to power in what was described as a revolution. The Provisional National Defence Council (PNDC) which became the ruling entity after 1981 held on to power until 1992 when the country was returned to multi-party democratic dispensation.
The challenge since 1981 has been how to find the best combination of Government-Peoples-Partnership that would meet each other part of the way and satisfy the needs and pockets of Ghanaians as well the Government’s finances in the healthcare sector.
‘Cash and Carry’ the system of healthcare financing introduced by the PNDC survived until 2004 when the present health insurance system came into being. Even then a large number of Ghanaians (about 30 percent) still subsist on cash and carry for their healthcare requirements as they have not registered to join the NHIS. This is one of the major challenges facing the Government and Management of the National Health Insurance Authority.
Under Cash and Carry’, patients were required to pay for drugs and some medical consumables, as and when they visit hospital, while the state bore all other costs including consultation, salaries and emoluments for Doctors, Nurses and other healthcare workers in state hospitals.
‘Cash and Carry’ also provided for free medical care for the aged above 70years of age, children under five years and pregnant women for their ante-natal care, all under an exemption programme implemented with that system of financing.
Under ‘Cash and Carry’, people went to hospital only when they were very sick and had money to readily meet their side of the bargain, to pay for those stipulated expenditures. That meant most often people went to hospital when they were really very sick and often at the terminal end of their lives. It was pointed out that ‘cash and carry’ constrained citizens from assessing healthcare except when they were in very dire situations resulting in needless deaths.
The search for an alternative to ‘cash and carry, as a means of healthcare financing in Ghana began in the second term of the National Democratic Congress(NDC) regime under former President J. J. Rawlings and the current President, Professor John Evans Atta Mills, who was then the Vice-President, between 1996 to 2000, but could not materialize for implementation though the foundation was laid with some pilot projects in the Dangme West District in the Greater Accra Region and Nkoranza District of the Brong Ahafo Region as a means of laying a firm foundation for what eventually became the National Health Insurance Scheme(NHIS).
The New Patriotic Party (NPP) Government under former President J. A. Kufuor which took over from the NDC Administration in 2001 moved to finally implement the conceived new healthcare financing regime of a health insurance scheme with a statutory enactment , the National Health Insurance Act, Act 650 in 2003 and the establishment of a National Health Insurance Scheme(NHIS) in 2004 under a National Health Insurance Authority(NHIA) with a governing council. This has been the system of healthcare financing in Ghana for the past five years.
The National Health Insurance Act, established three types of health insurance schemes in the country consisting of the District Mutual Health Insurance Schemes(DMHIS), Private Mutual Health Insurance Schemes(PMHIS), and Private Commercial Health Insurance Schemes(PMHIS).
The National Health Insurance Authority (NHIA) as established by Act 650 is the regulator of all forms of health insurance business in Ghana, as well as the implementer of the National Health Insurance Scheme in the Country. The dual role of industry regulator and implementer of the national health insurance scheme places the National Health Insurance Authority in a position of conflict of interest, which is untenable. However, Act 650 has remained in force and unchanged in its original form until now.
Funding for healthcare financing under the National Health Insurance Scheme as established by Act 650, comes from a Fund created by the Act, with income from two main sources, also created by the act. These are the National Health Insurance Levy (NHIL), a 2.5percentage top up of the Value Added Tax (VAT), and a 2.5percentage transfer from the existing Social Security and National Insurance Trust.
PICTURE SO FAR.
The story of the National Health Insurance Scheme, so far, for the past five years of its implementation, since 2004, is that it has come to be accepted by Ghanaians as one of the best social intervention programmes to be introduced in this country. More so because it was not one those programmes that were sponsored by the Donor Community or the World Bank and the International Monetary Fund (IMF)
Some very interesting statistics gathered by the Research and Development (R&D) as well as the Operations Directorates of the National Health Insurance Authority may be of interest to readers. As at the end of November, last year, 14,282,620 Ghanaians were registered with the 145 District Mutual Health Insurance Schemes operating the country’s healthcare system. Other interesting information regarding the National Health Insurance Scheme (NHIS) is as follows:
DISBURSEMENTS TO SCHEMES (MILLIONS OF GH¢)
|
ITEM |
2006 |
2007 |
2008 |
2009JAN-NOV |
|
|
GH¢ |
GH¢ |
GH¢ |
GH¢ |
|
SUBSIDY |
34.63M |
70.09M |
129.65M |
217.75M |
|
REINSURANCE |
0.85M |
9.17M |
8.32M |
39.85M |
|
ADMIN/LOGISTICS |
8.09M |
13.6M |
13.68 |
6.54M |
|
GRAND TOTAL |
43.57M |
92.86M |
151.65M |
264.14M |
SOURCE: Finance Directorate of National Health Insurance Authority
NUMBER OF GHANAIANS REGISTERED UNDER THE NATIONAL HEALTH INSURANCE SCHEME
|
YEAR |
ACTIVE MEMBERS |
HOSPITAL/CLINIC |
HOSPITAL ADMISSIONS ENCOUNTERS
|
|
2005 |
489,912 |
597,859 |
28,906 |
|
2006 |
2,422,106 |
2,428,008 |
135,221 |
|
2007 |
7,275,435 |
4,630,692 |
303,250 |
|
2008 |
11,064,581 |
7,070,306 |
475,568 |
|
2009
(JAN-SEPT.) |
12,123,338 |
5,553,806 |
351,765 |
SOURCE: Operations Directorate of National Health Insurance Authority
STATUS OF IMPLEMENTATION
1. SCHEMES IN OPERATION 145
2. TOTAL NUMBER OF SUBSCRIBERS 14,282,620
3. PERCENTAGE(%) OF POPULATION REGISTERED 69.93(2000 BASE YR.)
4. TOTAL ID CARD BEARERS 12,123,338
5. ID CARD BEARERS AS % OF TOTAL REGISTERED 84.9%
CATEGORIES, NUMBERS AND PERCENTAGE TO TOTAL CARD BEARERS
CATEGORY NUMBER PERCENTAGE OF ID CARD BEARERS
1. INFORMAL ADULTS 4,132,783 28 .94%
2. AGED ABOVE 70YEARS 960,549 6 .73%
3. UNDER 18YEARS 7,071,270 49 .51%
4. SSNIT CONTRIBUTORS 876,034 6 .13%
5. SSNIT PENSIONERS 75,444 0 .53%
6. INDIGENTS 444,597 0 .53%
7. PREGNANT WOMEN 721,943 5 .05%
PROVIDER PARTICIPATION IN NHIS (FORMAL)
FACILITY TYPE NUMBER OF FACILITIES
1. SECONDARY HOSPITALS 4
2. PRIMARY FACILITIES 62
3. CLINICS 94
4. HEALTH CENTRES 74
5. MATERNITY HOMES 130
6. CHPS ZONES 74
7. PHARMACY SHOPS 80
8. CHEMICAL SHOPS 55
9. DIAGNOSTIC CENTRES 45
PROVIDER PARTICIPATION IN NHIS – PRIVATE (PROVISIONAL)
PROVIDER CATEGORIES (PRIVATE)
1. HOSPITALS AND CLINICS 395
2. DENTAL CLINICS 5
3. MATERNITY HOMES 237
4. PHARMACIES 451
5. CHEMICAL SHOPS 329
6. DIAGNOSTIC CENTRES/IMAGING 128
The above present some rosy pictures of the National Health Insurance Scheme as has been operated since 2004, and indeed, it is an interesting story to tell. All across the country, the over 14,282,620 registered card bearing members of the scheme constituting some 69.73 percent of the population(2004 base population estimates) are getting treated without paying anything at the point of use, for conditions that would have cost them millions of Ghana Cedis, under the former ‘Cash and Carry’ system.
Thousands of women receive free maternal and child care under the free maternal programme. Women are undergoing fibroid operations and breast and cervical cancer treatment with their NHIS cards as ‘Visa To Free Health Care’.
Men, especially those in rural areas who had long suffered from hernia are getting treated at no other cost than their transport to and from the health facility. People with chronic debilitating diseases such as diabetes testify to the immense benefits of the scheme as they pay next to nothing towards the high cost of medication for various ailments.
THE CHALLENGES OF THE PAST FIVE YEARS
A feature of Act 650 is the almost autonomous District Mutual Health Insurance Schemes it created across the country, 145 of them now, which operate under the companies’ code of Ghana and are guaranteed by those who promoted them. Section 54 of Act 650 specifically states, “A scheme shall have a governing body which shall be responsible for the policies of the scheme and appointment of the employees”. As a result of this legal entanglement, each scheme in each district is completely independent of any other in the country, with independent Boards of Directors and do not pool risks together in any way.
While Act 650 created schemes which are almost autonomous it made it mandatory for the National Health Insurance Authority to make financial resources available to them from the Health Insurance Fund on a continuous basis. Section 33 of the Act states, “A District Mutual Health Insurance Scheme shall be provided with subsidy from the National Health Insurance Fund”. Another source of funding is the premiums which are collected from the in formal sector subscribers on the schemes.
While the law does not make it mandatory for the schemes to render accounts on their financial dealings to the Authority even with funds made available to them from public money, the Authority regularly funnels huge sums of money to them without the schemes being accountable for anything. This has opened the flood gates for the huge corrupt practices that have engulfed the schemes country-wide.
Act 650 and the system of health insurance schemes it created could be summed up as:
· A legal system that created over 145 independent health insurance Schemes across the country with their own Boards of Directors that took decisions independent of each other and shared no risks together.
· Massive financial impropriety by the motley assortment of 145 independent schemes fuelled by a legal regime that made it impossible for them to be controlled by any higher authority, not even the National Health Insurance Authority which on the surface was the regulator of the national scheme.
· An increasingly unsustainable health insurance bill that was multiplying exponentially due to massive fraudulent claims facilitated by a collusion of the schemes and some healthcare service providers.
· Lack of motivation and career progression for staff of the schemes as they are unitary entities that have no room for staff to uplift themselves up the progression ladder.
· Lack of portability of benefits under the scheme as subscribers could not be served anywhere else other than their own schemes.
DELIVERING ON THE NATIONAL HEALTH INSURANCE PROMISE
The new strategic direction of the National Health Insurance Scheme is dictated by the Social- Democratic philosophy of the ruling National Democratic Congress(NDC), as contained in its campaign manifesto of 2008, the salient points of which are:
“The NDC Government will implement a Universal Health Insurance Scheme which will reflect the universal contribution of all Ghanaian residents to the Scheme. Our universal Health Insurance scheme will guarantee access to free health care in all public health institutions. It will be listed in the health insurance schedule, will not be district-specific and will allow for one time premium payment for registration with the scheme. It will also cut down on the health insurance bureaucracy and plough back the savings into health care as well as review the disease and drug categories under the scheme”.( NDC Manifesto, 2008, page 68)
To achieve this vision and mission of President J. E. A. Mills and the NDC government, the National Health Insurance Authority (NHIA), has set for itself, the arduous task of delivering on what it calls “the NHIS promise”. The salient ingredients of this gargantuan task set by the Authority for itself are:
1. A health insurance system that guarantees a one-time premium payment.
2. A fully portable and sustainable national health insurance scheme fully supported and driven by a robust information technology (ICT) solution.
3. A new legal regime that fully addresse the internal horizontal and vertical inconsistencies that have characterized the scheme since its inception in 2004
4. An entirely restructured administrative and legal architecture of the Authority and scheme
5. An improved communication strategy that effectively markets the National Health insurance scheme to the Ghanaian people.
6. A National Health Insurance Authority that is fully focused on its core business of delivering a fully portable, workable, and affordable health insurance scheme that meets the healthcare needs of Ghanaians with one-time premium payment.
As we enter the second year of the administration of His Excellency President John Evans Atta Mills, the ‘new’ management of the National Health insurance Authority are just too aware, as our CEO stated at our very first “Tactical and Strategic” seminar on the theme “ Delivering On the NHIS Promise” held at Sogakope in the Volta Region in August 2009, “successful organizations do not emerge through chance, faith and coincidence, they are always a product of sufficient thinking, strategy formulation, diligent implementation and dispassionate measurement of outcomes”.
Management of the Authority imbued with the above realization is determined in this year, to realize the Mills’ administration’s avowed promise to the Ghanaian people of a one-time premium payment for all subscribers of the National Health Insurance Scheme. The scheme has to be sustainable into the future to cater for the health needs of generations of Ghanaians yet unborn.
The ‘new’ Management of the National Health insurance Authority has set itself the arduous task of lifting the National Health Insurance Scheme to new heights by embarking on very important programmes and policies among which are:
a. A centralized electronic claims processing system to replace the motley assortment of 145 odd manual claims centres spread across the country which is one of the main causes of massive fraud associated with the current claims management of the schemes.
b. A new legal regime to completely streamline and overhaul the operations of the schemes and the Authority, resulting in the creation of a single scheme under the complete control of the National Health Insurance Authority, which would be the implementer of the scheme
c. An Internal Audit and fraud Control Directorate headed by a fully Charted Accountant to work in association with qualified Accountants and Auditors in the regions and across the country to instil financial discipline into the management of funds made available to the various schemes.
d. A clinical audit unit headed by a qualified and experienced medical doctor to critically audit all claims that are submitted for payment to make sure that the Authority pays for actual services which are actually rendered to our subscribers by accredited healthcare service providers to minimise to the barest minimum, if not totally eliminated, the fraud that is associated with claims processing in the past.
As clearly spelt out by the new Chief executive Officer (CEO), at a management seminar on August 2, 2009 at Sogakope, “ The strategic intent and focus of the ‘new’ Management of the National Health Insurance Authority is to build a new national health insurance scheme that would stand out as a model in Africa and beyond, providing affordable, accessible and quality healthcare services for all domiciled in Ghana, with highly enthusiastic professionals who value customer intimacy and delight”.
The above is a formidable task that calls for strategic thinking, sacrifice and commitment, benchmarking best industry practices , teamwork, efficient use of resources, sympathy and empathy for the deprived and socially marginalized, reception for new ideas and constantly keeping an eye on the core business of the scheme as contained in our strategic intent clearly detailed above.
In preparing to deliver the new National Health Insurance promise this year, the Authority has taken steps to create some new directorates while revamping and strengthening existing ones to better position it to discharge its assignments. For example, the directorate of administration which was also responsible for projects, procurement and human resource requirements of the Authority has had carved out of it a directorate for projects and procurement, headed by a well qualified professional in the field and a human resource directorate headed by a Deputy Director.
As the new legal regime takes effect later in the year, all the 145 existing independent schemes would cease to exist in their current forms and would become district offices of the National Health Insurance Authority. It is only rational that the directorate of administration should be freed to take care of its core business of administering the Authority.
Another unit which has recently been strengthened to place it in good stead to perform its functions better is the Internal Audit Directorate. It is headed by a well qualified Chartered Accountant as Chief Internal Auditor of the Authority. The unit has generally been strengthened with qualified accounting professionals in the regions and the schemes across the country. The lessons learnt from snap audits undertaken across the country revealed horrendous fraudulent practices in the schemes leading to large financial bleeding of the schemes and great loss to the Ghanaian Tax Payer.
The newest of the creations to strengthen the Authority in its fight against fraud is the Clinical Audit unit which is headed by a qualified Medical Doctor. Clinicians are being recruited to staff the unit in order to properly vet claims submitted by healthcare service providers.
The National Health Insurance Scheme has come to be accepted as a welcome relief for Ghanaians in the area of healthcare financing. The challenge is how to sustain the system and make it viable into the future. That is the challenge facing the new Management of the Authority and the NDC Government under Professor Mills. There is no doubt that with total commitment, dedication to duty, cooperation among the staff and political support, the new strategic direction of the scheme of a one time premium payment shall be a reality this year.
As the year 2010 wears on, Ghanaians can look up to the Management of the National Health Insurance Authority in confidence that it would deliver unto them a health insurance system that is workable and affordable and which would meet the needs of Ghanaians for effective healthcare financing well into the future. A National Health Insurance Scheme that is our passport and visa to a healthy wealthy nation.
Produced by Directorate of Corporate Affairs & Strategic Direction, NHIA
