Members of the public service and employees hired by private companies will benefit from Social Health Insurance (SHI) in the coming year, a decade after a law was passed. It has not been enforced until now.
Employees will be covered by the insurance policy, paying three percent of a monthly premium deducted from their gross salary while the government subsidises an additional three percent. Regional states are tasked to include the subsidy when requesting a budget subsidy for the coming year.
Minister of Health Lia Tadesse gave a mandate to the two city administrations and health bureaus under the regional states to implement the scheme. They will have to collect and report the number of employees in their respective regions and monthly revenues to the Ethiopian Health Insurance Services (EHIS) until January next year.
The EHIS was formed in 2010 to benefit pensioners but evolved to address the needs of public and private workers, according to Zemedkun Abebe, communications director.
"The implementation has been delayed due to the lack of awareness among the public," said Zemedkun.
However, people such as Berhane Eyasu are unsettled about the deduction from the gross salary. The 56-year-old has worked as a cleaner for nine years, with a gross monthly wage of 2,300 Br. She is not eligible to use Community Based Health Insurance (CBHI), a federal government welfare program supporting people without regular income. The Addis Abeba City cabinet has approved 181 million Br to subsidise the insurance scheme to cover 130,000 households in the budget year.
Berhan prefers to take her chances with public health institutions, provided that it comes to that.
"I'm barely surviving with my current salary," Berhan told Fortune.
Policyholders can get medical services in more than 3,000 health institutions that would sign agreements with EHIS. Close to 15 million people are employed, with 866,000 working in federal institutions, according to a labour force and migrant survey conducted last year.
Anteneh Teshome, team leader in the EHIS Addis Abeba branch, received the notice but has not collected the information.
"We'll begin collecting data in the coming two weeks," he said. "If we find it necessary, the Branch will hire people on a contractual basis."
The information collection and organisation will cooperate with volunteers at the City Administration's Health Bureau.
CEO of Nyala Insurance, Yared Molla, agrees with the government's involvement in CBHI but recommends making the SHI scheme mandatory, as third-party insurance is a better option than its involvement. He observed that life insurance is not expediting despite the population rise due to a lack of awareness and fear of expensive premiums.
The insurance company launched a micro health insurance policy and piloted it, but it did not take off. Five of the 18 insurance firms do not provide life insurance for a population the United Nations estimated four months ago to have reached 124 million.
Nearly 194 weredas across the country have mobilised 3.7 billion Br from CBHI payments to EHIS. The annual payments of CBHI are revised every year, and subscribers are expected to settle their payments from September to November.
Dire Dewa City Administration has 32,000 beneficiaries and annually collects 375 Br from rural and 675 Br from urban households. Workers who cannot afford medical services regularly arrive at their office, according to Lemlem Gezahegne, head of the city health bureau.
Ebisa Mohammed, an insurance expert with Alpha Consultancy, doubts the premium the targeted low-income employees can cover. The law has not been implemented for over 10 years and should be revised considering the prevailing economic difficulties.
With the high prevalence of non-communicable diseases, the government should also prepare to raise the subsidy, said Ebisa.
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