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Social Health Insurance faces tough hurdle in Parliament

By Flavia Nassaka

Critics wary of corruption and say Uganda lacks the physical infrastructure to support scheme

Thirteen years after it hatched plans to launch a compulsory public Social Health Insurance (SHI) scheme, Uganda appears set to launch it this year.

Dr. Asuman Lukwago, the Permanent Secretary in the Ministry of Health, says the scheme will start operating this year since they are in the final stages of drafting the law.

Under the National Health Insurance Bill 2007, which is currently still with the Ministry of Finance awaiting issuance of a certificate of financial implication,  civil servants and formally employed Ugandans will be required to make mandatory contributions to a National Social Health Insurance (SHI) Scheme.

Dr. Francis Runumi, the Chairman of the task force faced with setting up the scheme told the Independent that once the law is passed, an independent administrative body will be set up with a mandate to collect SHI contributions.

According to Runumi, those already privately insured will either choose to be insured twice or abandon private insurance since SHI will be mandatory.

The plan is to initially cover about 25% of the 34 million Ugandans, whereby employees are required to contribute 4% of their gross salary to which employers add 4% making the total contribution to the scheme 8%.  The informal sector will be incorporated to the scheme later on under the Community Health Insurance initiative.

The proponents hope the Social Health Insurance (SHI) will complement 13 private providers of insurance already practicing in the country.

Currently less than 10% of the population is insured on health.

Only 25% of the population is formal sector workers and each one’s contribution is expected to benefit four of their dependents.

Mariam Nalunkuma, the communications officer at the Insurance Regulatory Authority (IRA), says is now involved in creating awareness about the relevance of the scheme since the biggest segment of the public is still ignorant about how the scheme will operate, what it will cover, and how insurance generally works.

No chance in 2015

Despite its promise to counter the raising costs of health care and all those praises that the scheme has received, some observers say health Insurance has no chance in 2015.

They cite countries in the West that took decades to perfect their health insurance systems yet they are far developed and have a few development challenges.

Michael Lulume Bayigga, a medical doctor who is a member of the Parliamentary Committee on Health is one of them. He says that Uganda is still far from achieving public health insurance because it lacks the physical infrastructure to support it. He says there is need to create trust that the taxpayers’ money will not be swindled.

“There are so many issues that make this law redundant,” he says, “For instance how can one sign up for insurance when they know there are no doctors who will treat him once he falls sick or there are no enough medicines?”

He advises that before jumping onto insurance, the government must first create a system that ensures that drugs, machines and the human resource are available to cater for the public’s health needs.

Bayigga also says consumers/ workers should be left to choose the scheme of their liking whether it’s private as long as the services offered are not against to those stipulated in the law.

He says the committee has only travelled to Israel in November to see how the system works there but more countries like Rwanda and South Africa should be visited too in order to take more lessons from their success stories.

Although relatively poor, Rwanda leads the league of public health insurance in the East African Community. Uganda looks set to be the last in the region to incorporate SHI in its system. In Rwanda, the government caters for the poor and the rest contribute according to their economic statuses.

Rwanda has a heavily subsidised community-based health insurance system and integrated it into a national network that combines local accountability with national pooling and cross-subsidisation. Their insurance is financed by budget transfers (from tax revenues and donor aid) combined with sliding scale member contributions.

Questioning implementation

Dr. Ian Clarke, the CEO of the International Medical Group says the SHI is a great idea as the cheapest way to meet health expenses is by medical Insurance since with insurance one can spend less than Shs500,000 on treatment a year yet without it, one can double this fee for a single visit.

Dr Clarke says, however, he’s worried about Uganda’s approach whereby the heaviest burden will be carried by the workers who are already shouldering most of the tax burden in the country.

He suggests that other sources of financing such as NSSF be explored since he sees no need to create another administrative set up to collect social health insurance contributions.

“They could add a health benefit to NSSF for instance or motor third party insurance money could be used for road accident treatment since no one knows what happens to such a big pool of money”.

Employers, who already contribute 10% of employees’ gross income to the national pension plan, National Social Security Fund (NSSF) are still discontented with how the 4% figure was determined. Rosemary Ssenabulya of the Federation of Uganda Employers’ told the Independent that “while it’s a good idea for workers’ health to be insured, it’s an additional expense to us that can also affect the cost of doing business”.

Like Clarke, Ssenabulya suggests a small percentage, say 2% of the NSSF contributions  be set aside for the health scheme other than burdening the formal sector more but also wonders whether government could guarantee efficient service delivery.

There are also fears over how the government will execute such a project without people’s money falling into corrupt hands as has happened in many government ventures.

Nalunkuma says people’s money will be safeguarded as stakeholders have taken lessons from similar schemes in other countries that have faced the same challenges. She explains that a semi-autonomous body will run the scheme to ensure that there’s limited influence from government.

Runumi also advises people not to be skeptical. He says SHI is the only solution for the country with high prevalence of HIV and other diseases since with this pool of money, medicine and other infrastructure will be put in place to provide quality services leaving no need for people to seek medication abroad.

Despite Dr Runumi’s exhortations,  and as Dr Lukwago said,  the Bill establishing the SHI scheme still has to be passed by parliament. In the past, it has always failed to make it through parliament as it faced resistance from labor unions, employers and worker representatives. Will this time be different?

Some people, like Edward Mubiru, who know the value of health insurance hope so. Mubiru recalls the time his employer compelled all staff to be medically insured.

As a fresh graduate, it was very painful for him to have a portion of his small salary deducted every month and he did not understand the relevance of insurance any way.

But he came to appreciate health insurance two years ago when his mother, Imelda Nakyonyi developed heart complications. He says in a month she needed to be hospitalized more than twice.

“I don’t know how I would be covering these endless bills. Insurance doesn’t only give me peace of mind during this crisis but my mother too,” says Mubiru.

Ugandans needs a SHI to enable citizens like Nakyonyi access quality health care at any time without parting with a lot of money. This is in line with the pledge to realise universal health care by 2015 that Uganda made during the African Union health ministers meeting in Botswana in 2005. To date, this has just remained on paper.

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