Health Insurance in Ghana

Wednesday May 29, 2013 -

This week, let’s talk about health insurance; its role and challenges in Ghana.

I must first admit that I do not know a great deal about the effectiveness and responsiveness of health insurance companies, especially the National Health Insurance Scheme (NHIS), in meeting the needs of patients in the financing of their medical care in Ghana.

My comments will be based on what I have read and a review of the NHIS website, and my general knowledge of how insurance works. (I worked for two companies, in the US, which combined health insurance and direct patient care [HMO] for a combined total of eight years as Medical Director).

There are three observations that I will make. The first is that health insurance is currently the best and most equitable and effective way to finance individual and collective health care. Out of pocket payment such as the “cash and carry system” of old, is problematic and in a “poor” country like ours, it is inhumane.

My second observation is that the introduction of NHIS is the best thing that has happened to healthcare delivery in Ghana in the last decade.

My third observation is that the NHIS has the greatest potential to improve access to healthcare, the quality of medical care, and the behavior of hospitals and doctors, especially those in private practice. The maxim of “he who pays the piper…….” However, for health insurance to be able to do these things, it must be respected and attractive to both providers and enrollees. If it is inefficient, not respected and not attractive, it becomes nothing but a conduit for money from one source to a destination. It will just become an administrative arrangement and actually an obstructive bottleneck.

From what I have read about the recent challenges of the NHIS, it does not appear to be doing too well. It is getting the enrollment, albeit more from the lower income population than from every Ghanaian as it was envisaged, but the providers are not getting paid on time and reimbursement rates are, reportedly, unsatisfactory. It is also grappling with corruption.

These may be teething problems (after ten years?) or may be a reflection of suboptimal management. It is absolutely essential for the NHIS to work well. A well-functioning NHIS will increase the internally generated funds for public hospitals, which will not only help their operations, and the quality of care they provide to patients, but could lead to some level of autonomy that can allow the hospitals to refurbish equipment and buy new ones. Hospitals cannot function and the quality of medical care will drop if they are not paid for services they have rendered. The NHIS cannot afford a negative reputation over a prolonged period. That could destroy the potential that it has.

I have also been concerned about the low premiums that enrollees pay and the absence of co-pays and enrollee financial exposure outside of the low premiums. On one hand, I would understand if the reason is because most enrollees are poor and extra payments at the point of service would just be a disincentive to going to hospital in the first place; something that would defeat the purpose of the insurance. On the other hand, I am concerned about “moral hazard”. I suspect that the dissatisfaction that patients have with visiting a hospital unless they really have to, (what with the long waits, the insults etc.) act as protection against the threat of moral hazard.

If my first conclusion is right, then NHIS becomes a pure social service, in which case, it has to be well resourced through taxes, whether direct or indirect. Considering the heavy demands on the public purse, can we add another heavy burden like a pure publicly funded health insurance system? Remember healthcare costs go up inexorably, and we do not have any credible systems in place to control costs. Does that not make the NHIS vulnerable to failure that will threaten the whole public health delivery system?

Let us hear your, more informed, views and comments on health insurance in Ghana, especially the NHIS.

Dr. Joseph Boateng

About Dr. Joseph Boateng

Dr. Joseph Boateng is a Physician Specialist. He has practiced medicine for over 31 years. He has extensive medical management and leadership experience as Medical Director or Deputy Medical Director for several hospitals in the US, Ghana and Nigeria, and as the managing partner of a medical practice he founded in the US.

15 comments on “Health Insurance in Ghana

  1. In my view I think the fundamentals of the NHIS in Ghana is well captured in Dr. Boateng’s write up. Obviously, the relevance of the scheme is laudable and I want to believe it is very much appreciated by many considering its history. The fact that government funding for health investments dwindled, drugs shortages were high, and hospital utilization was abysmally low with resultant deaths of many including pregnant women and children. Indeed, many successes in our health indicators in recent times can be attributed largely to NHIS.

    Unfortunately recent events pose a serious threat to scheme. Upon reflection I think there are about three issues that have contributed to the state of affairs.

    The management of the scheme which was based on a mutual health insurance mechanism has changed with the introduction of a more centralized system largely controlled by government and unduly dictated by political influences. I recall in the early days of the scheme, management of hospitals had better relationship in communicating and resolving challenges with the mutual health schemes; but a more dictated mechanism from HQ of the scheme has been observed recently. This is creating tension and disquiet that affect patients care. Since community ownership of the schemes has waned, it has become a challenge for government to justify premium reviews even when it is necessary. We have through politics created a barrier that hinders community support, a factor critical in sustaining the scheme. The last time I checked, the schemes by law were still suppose to be limited by guarantee, obviously its nature has changed due to political influences in its culture of work. The extent of political ills on the scheme include not only the effects on skilled personnel but also unscrupulous machinations of taking monies that are to be re-invested in the health system for other purposes; and you can guess what these are.

    The fundamentals, we had most right. The structure of the scheme was and still is elaborative but for the effects of the influence I have already described. A little piece of block that was missed in the arrangement, was the re-orientation of the hospital management practices that could enhance transparency and accountability to the scheme and most importantly to its clients. I have not worked in US or UK, but I am told that the hospital management structure is led by an administrator who has limited conflict of interest in ensuring that all staff conduct themselves professionally and in a manner that would not compromise on cost or contravene arrangement with health insurance schemes. Indeed he fires and hires! I think due to the poor working culture of the different professional grouping in the health system, mostly hospitals, it is very difficult to ensure adherence to protocols that could sustain the scheme. No one is a police of the other. It is a jungle where each group defends itself disregarding the consequence either on the client or on the scheme. May be I will be right to say that the lackadaisical approach in handling patients is the same way we handle issues about the scheme especially records, with impunity. Supervision, monitoring, records keeping are very critical elements in addressing sustainability of the health insurance scheme.

    Health Information Systems (HIS) in most hospitals are weak. A review of hospital budgets would show the gross disregard of demands of HIS. Management of hospitals only discuss HIS when the are quizzed on their performance or would want to find justification for an action or decision. Health Insurance schemes have thrived in other places because of well structured information systems that support patient care. We know majority of doctors, nurses and other staff are computer literate (at least they know where to press ‘a’ on a keyboard). Sad to note, we seem not to advance our arguments about wrong insurance claims, rejected claims, etc. by investing in an information system infrastructure that keeps tract of what the patient goes through on arrival at the hospital.

    The above, I believe are where we have failed.

    Now, capitation is being propagated. As usual we find it to be the cheap way to solve the problem; and government has clinched to it resulting in several bouts of boxing with providers especially in the private sector. Upon the introduction of capitation, we have seen the bad outcomes in Ashanti region, where it was piloted. The region currently is holding the country back with regards to MDG 4 and 5 due to capitation.

    But in the mist of government-providers conflict, my biggest concerns is WHO SPEAKS FOR THE PATIENT? Nobody really cares what happens to the patient in the hospital or at the insurance scheme? Yet all the funds for the scheme come from prospective patients? WHO TELLS HOW THE PATIENT/CLIENT FEELS about this confusion. No one does.

    Even though I agree largely with the theories related to the abuse of health insurance schemes, I think the issue of moral hazard does not fit in our context. Moral hazard as a concept calls for mechanisms to limit utilization of services. This defeats the very foundation for which NHIS was set up. We hide behind moral hazards when we know, it is a direct output of the poor services to patients. Patients do not have confidence in the care given because they are in doubt of the service from the kind of environment we create for them (long waiting time, poor communication, lack of concerns and respect etc). In any case, who determines when a person is sick? Sorry for being passionate but I think we can do better analysis to avail solutions to the sustainability questions to the NHIS rather than hid behind some ‘book long’ concepts.

    Excellent topic for discussion. Keep it up!

  2. Thanks again Dr. Boateng for initiating the discussion on the issue of health insurance in Ghana. Health service is one commodity, which economists often refer as having price inelasticity on demand. No matter the price of health services, demand for it will not be appreciably affected whether one can afford it or not. Health economist believes and I verily do too, that when a catastrophic illness hits an individual, it may or can lead to bankruptcy if no “rainy day funds has been set aside for such health emergencies”. In poor economies such as Africa and other emerging economies where poverty levels and unemployment rates are high, the means to get by on a daily basis is hard for some people. Even affording a good descent meal is a hassle for many. For this reason, not many individuals are capable of, as it were, keeping any rainy day funds for health emergencies. Therefore, given an event of an illness in the era of cash and carry, patients have been recorded to die at point of care for not having the money to pay up front before service is provided.

    This is why health insurance which operates through the pooling of resources and risk together for the mutual benefit of those enrolled, is one of the best things a country or any government can ever give to its people.

    The advent of health insurance in Ghana has been a great relief and has no doubt, enormously helped some how, to address very serious health care accessibility issues.
    In Ghana, the agency mandated to over see health insurance is the National Health Insurance Authority (NHIA). The last time I checked (quite a long time ago I must admit), three were main types of health insurance in Ghana whose operation must receive accreditation from the NHIA
    1.District mutual health insurance scheme (by far the largest) and here enrollees pay premiums and the mobilized revenue also benefits from assistance from government in the form of subvention to facilitate its operation.
    2.The private commercial health insurance schemes, operated by approved companies where individuals or employers can buy health insurance for themselves or for their employees.
    3.Private mutual health insurance schemes, these are ran by by churches or any groups of individuals or society coming together to set up an insurance fund for its members.
    The last two do not receive any assistance from government. Whatever form of health insurance one signs up to, entitles you to some minimum basic services. Any incurred from any procedure or service outside the ones prescribed by the insurance scheme must be borne by the individual.

    What then is the problem with health insurance in Ghana?

    1.Mismanagement of funds: The NHI scheme is bedeviled with corruption and riddled with embezzlement. This needs a serious forensic audit, restructuring of management and checks and balances put in place to prevent corruption. In some countries such as the US, health care cost is unnecessarily high because CEOs and employees of insurances agencies are paid tons and tons of money as bonuses. There is therefore an incentive to deny claim by patients or to refuse to pay for certain services with the use of the most flimsiest of clauses, just to maximizes profits so that end of year bonuses can increase. This happens when insurance is mostly controlled by private agencies. To prevent this, government must makes the government ran one more attractive.

    2.Revenue mobilization. This affects not only the health insurance schemes but also every fabric of national development. Since health insurance is based on pooling of resources and risk, where there is no optimum balance between the two, the scheme is bound to suffer inadequacies and failure. For instance if majority of the enrollees in the largest scheme (government ran NHI) are unable to keep up with premium payments, government must increase its subvention to these schemes. For the gainfully employed, the issues of premiums are taken care of by their employers (that’s if they pay for health insurance) but the rest of the population who are not employed and who have no any means of livelihood (the core poor) has to be catered for in one way or the other. This is where government has to define who is considered core poor. This is easy to do, by the use of household income or house hold expenditures as a proxy for income. However, where does the core poor live? Where do we find them if we are looking for them? How does government set out in quantifying income levels in other to define who is core poor? This is where it becomes all too important for every town or village to have easily identifiable address systems including zip codes or postcodes. (I am glad this will be the new thing to happen to Ghana soon and I have read that it has already taken off in some parts of Accra) and will be replicated across the country under the urban redevelopment project.

    3.A comprehensive debate on the appropriate way to finance health care is needed. The one-time premium payment that government is trumpeting about is grossly untenable. There is enough evidence to show that this will sooner or later bankrupt the scheme.

    4. Reimbursing care providers. This is a huge problem and the number one complain coming from care facilities. Most people have been turned away from some health facilities because government owes them in arrears in payment or is behind in its payments. Remember these institutions must operate on some budget and so not reimbursing them in time can hamper their smooth operation and capability of proving quality care. The reason government is unable to promptly reimburse these institutions is probably due to “over subscription” of insurance that has out paced the meager resources from pooled premiums and government assistance. Why is this so? Some of the possible explanation are (a) poor revenue mobilization addressed supra (b) moral hazards (c) high frequencies of reporting to health facilities and/or high readmission rates (d) seeing a Dr. (more expensive than say a medical assistant (I am not sure if this applies to the insurance system if Ghana).

    5.Moral hazards. Whether we like it or not this exist and is a problem for every insurance scheme though out the world. It is just human nature. In the lay sense, this is where people tend to “abuse” health insurance because they have health insurance. The way to check this, which could add to increase revenue is to introduce copays for certain procedures, visits and visits beyond a certain Nth time and co pays for certain drugs. There could also be a deductible (means differently by different agents) but simply put, this is the initial amount that an insured person has to pay before his/her health insurance can kick in. Or a window period within which you cannot yet utilize your insurance. This will avoid going to register for insurance just because you have this new diagnosis that requires a lot to manage. There could also be set ceilings beyond which you may need to restart your premium or pay for the extra cost. (This should also be applied to the core poor). This point may seem hash but it will help make people more responsible and chose better health habits of staying and keeping healthy. There should also be some form of incentives to reward people who for some reason (based of the healthy life styles they have adopted) not fallen sick and not utilized care (not sure how this can be done, but it is worth a thought).

    6.More frequent catastrophic sickness (such as myocardial infarctions, cerebrovascular accidents, emergency surgeries, severe trauma and any complications from any underlying disease) can wipe out a greater chunk of health insurance resources. These can be dealt with by instituting regular physical exams and monitoring of such underlying medical conditions by (not doctors, who are already over burdened, but by medical assistants and experienced nurses at community health centers or clinics). It should be mandatory that every enrollee must receive a yearly physical to, as it were “catch any disease young”. These checks will check any complications and limit the frequency of patients presenting at policlinics or tertiary centers with life threatening conditions or complications whose management is expensive. This also means stepping up with preventive measures across the population and instituting health promotion programs such quitting smoking, banning smoking at public place, heavy levies on unhealthy foods and food products, encouraging physical activity, health education to debunk the ill conceived notion that the bulkier you are more the better.

    7.Hospitals must remain committed to provide excellent quality care to reduce readmission levels and ensure that patients given better care. This calls for all the issues addressed before in other earlier discussion including improvement of communication between and among care providers and patients, quality training, refresher courses on the management of the critically ill and in the general approach to emergencies

    8.Where there is universal health insurance, the harvest is bound to increase, this calls for more labor. As such, increasing training of health care providers and personnel at all levels, especially medical assistants doctors and nurses must be borne in mind by government and other stakeholders including districts. Having said this, any mass production of such personnel not backed by the appropriate remuneration to motivate and retain them will lead to their attrition to other countries where the grass seems to be greener at their feet.

    9.Government subvention can also be applied to private not for profit insurance schemes such as those ran by religious organization which, also health to mob up the indigents.

  3. VERY GOOD WRITE-UPS and good reading, HOWEVER.
    Ghana has gone through -free care by missionaries—free care by government-precolonial-colonial-post colonial–cash and carry–
    I do not like politics, but the NPP did well by starting the scheme, that was bold.
    The NDC government has NO political will to continue it ?jealousy?? Lip service???
    Even without oil NPP was able to do something.
    I will pause here will come back with what needs to be done.

  4. Thanks to Dr Boateng and everyone for taking part in this important discussion about health Insurance in Ghana.I think almost all of us will agree that with the current economic situation of most people this is probably the most efficient way of getting health care to the people.Its clear the cash and carry system is not working.
    The fact that we have had the NHIS implemented for at least the last 4 years in itself is an achievement,but like other good ideas , poor management ,political influences and lack of transparency can lead to its failure.
    There is a lot to be said about the policies and how the scheme needs to be managed etc, but my fear is that most people in Ghana do not really understand what this is really about in terms of their responsibilities and the kind and extent of benefits their membership gives them.
    As mentioned above by Kofi Boateng in his post most patients are confused and its unclear who is advocating for their interest.
    We must find a way of limiting the influence of political parties on its operations

    There should be civic organizations who should advocate for transparency as well as represent the interest of the patients.

    People in Ghana must realize that health care is expensive and that from time to time premiums may need to be increased.

    This should not be allowed to fail as its in the interest of the whole nation .We as a nation must not see this insurance scheme as NDC vs NPP or PNC issue.The NHIA should be an independent body with the sole aim of advancing the health care situation in the country.

    And finally I combed through the NHIS website out of curiosity to find out which drugs are being covered.There is a list of covered drugs under the scheme from 2009. Drugs for common ailments like hypertension,malaria and diabetes and even a hand full of Cancer chemotherapy drugs are on the list.For a start I must say I was impressed especially with the few chemotherapy drugs on the list.As this is my area of practice I know how expensive some of are these cancer chemotherapy medications are even in the USA .If these drugs are really being covered as stated on the website then that will be really nice.

  5. Thanks again Dr. Boateng.
    As mentioned by some on this forum the NHIS should be be run by a bipartisan committee to improve medical coverage to those who need it the most. Kudos to ex-president Kufour for initiating it and shame anyone who will want to undermine the goal. The NHIS is still work in progress.
    We can’t possibly have one time premiums.
    The more fortunate should be made to contribute more to it.
    A part of our taxes should go towards it.
    There should be different copays depending on your income level and the type of treatment you need.
    As Dr Alebi stated it is great that some chemotherapy drugs are on there as they should be despite the cost. We are all human and anyone can get cancer.
    We should all work hard to make sure that this doesn’t fail.. We can’t and shouldn’t go back to cash and carry. Lets improve it.

  6. For the Health Insurance Scheme to be efficient and effective, the national need to embark on a secured national numerical identification process just like it is in any developed country for example the Social Security Number in the United States or the National ID number in the United Kingdom. This will be the basis from which any national economic planning can be accurate and successful. From education, agriculture, health and other socio-economic ventures.
    Without anything bold of this nature we are doomed to fail abysmally because it all about statistics.

  7. I would like to know, why would good samaritan Hospital hold their paients hostage
    if they cannot fully pay hospital bill upon discharge, why incurr more debt for hospital
    why not allow patient or responsible part to sign promissory note. Lord knows as much as I love your country, I pray I will never ever ness your services.

    • Ayanna, could you expatiate a little more on your comment. You are talking about a Good Samaritan Hospital. In Ghana? Do tell us about your, obviously, unsavory experience.

      • Thank you all for your contributions especially Dr.Boateng for leading the discussion. Despite the numerous problems the NHIS has or is facing, I am sure the people behind it are working hard to find solutions to them.

        One area I would suggest is to have a better mechanism to collecting and reporting data. Once that has been achieved, we would be able to accurately provide and or project accurate information that will help find solutions to the problems we are currently facing. I have always believe that to be successful in business, you need to know the “in and out” of what goes on within so you would be able to have the big picture about the business. By that I mean, have some kind of data presentations to make sound and accurate decisions.

        To my point, we can’t solve the problems in our healthcare delivery system based on assumptions without actually deep diving into patients utilizations to give us the big picture of the true cost of care. Example you can not assume low premium, zero copay, zero deductible when you have no idea of the true cost of care and think that you can have a successful healthcare system.

        In my opinion, the first thing to tackle is making sure we have accurate system of identification to electronically track patients utilization records. The providers or hospitals should track their own patients utilization records and the payers at the other end should also track their own customers claim records. Independently, the hospitals and payers records in terms of claims submitted for payment should be consistent and much closer if the systems should work perfectly. This will help reduce payment frauds. Also premiums or cost sharing would be based on facts or sound actuarial numbers and not based on assumptions.

        I believe we have taken the right steps by introducing health insurance scheme in Ghana and I am optimistic that together if we all work hard directly or indirectly towards a better healthcare delivery system we shall be successful.

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  9. We could learn something from the German Health Insurance scheme to improve the NHIS scheme in Ghana. In Germany cost is shared between the employee and the employer and that is fair. I am a ghanaian and a dental nurse in Germany. Dr. Boateng keep the good work out there and Ghana need more such people like you. God bless you.

  10. It’s really a great and helpful piece of info.Health insurance is very important nowadays, having one would give you something to cling to in times of sickness that’s why I trust PPLIC.