Why new medical insurance scheme is a game-changer for success of UHC

Health CS Susan Nakhumicha. [Denis Kibuchi, Standard]

President William Ruto signed the Social Health Insurance Bill into law on October 19, signalling the replacement of the National Health Insurance Fund with the Social Health Authority (SHA).

This is the agency that will, once it is put in place, manage the new Social Health Insurance (SHI) scheme. The SHA will oversee three critical funds: Social Health Insurance Fund (SHIF), Primary Healthcare Fund and Emergency, Chronic and Critical Illnesses Fund.

While SHIF will be funded by expanding the pool of premium contributions from both the formal and informal sector, the Primary Healthcare Fund and Emergency, Chronic and Critical Illnesses Fund will be financed by the government through taxes, donations and gifts.

The new scheme will not only expand insurance coverage but also fix the challenges that NHIF has experienced, including undertaking functions that resulted in conflict of interest. Such functions include the accreditation and empanelment of health facilities, claims management, dispute resolution and quality assurance of hospitals.

As all Kenyans become members and contributors to the SHIF, the premium contributions are likely to change from the previous Sh150 to Sh1700 range to a fixed rate to be ascertained once regulations are concluded, based on a household's income. The government will continue providing health insurance subsidies to orphans, vulnerable and people with severe disability based on data provided by the State Department for Social Protection, and to people experiencing extreme poverty.

The implication for the poor is that those currently enjoying the benefits from the government subsidy programme will continue doing so up until their premiums are due. The informal sector contributions will be annual and premium financing modalities put in place for those not able to pay due to the inconsistency of their income flows.

The aim is to get 85 per cent of the population under the insurance scheme, meaning that other parallel schemes such as Linda Mama and Edu Afya, which are individual-based and not household-based, will have no place since the SHIF will have catered for the entire household.

The formation of SHA will ensure an expanded benefit package to all Kenyans from what was previously covered under NHIF. For example, the government will allocate resources for emergency, chronic and critical illnesses that will improve access to intensive care and high-dependency units, particularly for Kenyans who cannot pay and would otherwise be turned away from hospitals.

The Primary Healthcare Fund will also meet nearly 90 per cent of the population's health needs at the primary level, focusing on people experiencing poverty, with a return on investment of up to $16 for every dollar spent.

The SHA will take advantage of digital technology and outsource services that would otherwise increase administrative costs, which will be capped at five per cent.

In addition, upon verification, SHA will make payments based on a tariff for services rendered across all the healthcare facilities, irrespective of whether they are public, private or faith-based. For Kenyans who would like to seek services in facilities whose fees are way beyond the tariff, the SHA will pay the agreed tariff, and the individual could top up using cash, or private insurance.

All Kenyans will automatically benefit from the Emergency and PHC Fund irrespective of their contribution status. However, for one to benefit from the chronic and critical illness component of the Fund, one needs to be a contributor to SHIF. SHI scheme also provides an excellent opportunity to enact a systematic and evidence-based process for designing and developing essential packages, expanding the number of services covered and the network of healthcare providers, and consolidating all schemes into one fund. This was unclear in the previous NHIF scheme and made the package unsustainable.

-Dr Wangia is the Acting Director of Health Financing Directorate, Ministry of Health; while Dr Opon is Acting Senior Technical Advisor, Amref Health Africa in Kenya