Fortune News | Sep 08,2019
The implementation of the Social Health Insurance (SHI) scheme, which was scheduled to begin next fiscal year, has been halted due to budget constraints.
The scheme aimed to benefit public service and private company employees, with the federal government covering three percent of the cost and an equivalent rate deducted from their gross salaries.
However, the Ministry of Health has put a hold on the commencement due to difficulties in obtaining the expected five billion Birr from the government's side. The Minister of Health, Lia Tadesse, has indicated that a possible mid-year implementation or postponement to the subsequent budget year may be necessary.
The budgetary constraints are further tightened by the waning of funding from development partners, limiting access to finance for the already wounded sector.
"Prevailing budgetary conditions would not permit this," said Lia during a nine-month performance report to Parliament a couple of weeks ago.
Since its establishment 12 years ago, the Ethiopian Health Insurance Agency has been working towards implementing two types of health insurance systems in the country.
Community-Based Health Insurance (CBHI) that caters to the informal sector has garnered wide acceptance while SHI, which was up for commencement next year, was planned to include the formal employment sector.
Deputy Director of the Agency, Muluken Argaw (PhD), said the utility of both insurance schemes is self-evident. He said engagement with hospitals and other health institutions is in motion, where preliminary tasks have been completed to implement the SHI.
"We're waiting on further instructions," he told Fortune.
According to Muluken, close to six billion Birr has been pooled this year from 12 million households for implementing CBHI, with funds pooled through a 25-75pc scheme between the federal government and districts for the poorest members of society.
"It covers almost 90pc of Weredas the country," said Muluken.
Social Health Insurance schemes have been indicated as holding the promise of universal coverage by literature in developmental studies since its inception in Germany in 1883.
Last year, a study published by the American National Library of Medicine indicated that considerations in SHI implementation planning should include per capita income, capacities of formal and informal sectors, target groups and geographical population distribution. It considers a sizeable formal sector and a willing employee base as prerequisites for successful implementation, while economic development, a strong government financial and administrative capacity, and higher trade union density increase the likelihood of success.
Demis Mulatu is a lecturer at the Department of Health System & Policy at Gonder University. He observes that efforts by the government to implement CBHI schemes widely have been accepted favourably by rural communities.
"It has had a remarkable reach," he told Fortune.
Demis said resource-pooling schemes seeking to share financial burdens while distributing gains to members are crucial in promoting public health.
The now scraped SIH plan was poised to be operational by next year after two city administrations and health bureaus within regional states reported their employee size to the Ethiopian Health Insurance Service.
Per capita health expenditure in Ethiopia is 33.2 dollars. Close to 32pc of the total health expenditure is covered by the government, while 31pc is out of pocket, and the rest is covered by development partners, according to data from the Ministry of Health.
Getasew Amare, a health economist, said that being watchful of frustrations from members of social health insurance schemes is essential. He observes a high drop-out rate due to poor service provision from health institutions, pointing out the need for input from employees within the formal sector.
He recommends engagement modality of insurance companies be incorporated to realise success, as premiums will be mandatory.
"Engagement with the private sector is pivotal," he told Fortune.
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