Hi guys, I recently came across this beautiful write up by a talented friend of mine, here it is:
HEALTHCARE financing is at the centre of most health policy reforms. With the rising cost of healthcare globally, healthcare financing has become a necessary tool in achieving quality healthcare for all. According to World Health Organisation (WHO), Health Financing refers to the function of a health system concerned with the mobilization, accumulation and allocation of money to cover the health needs of the people, individually and collectively, in the health system.
The purpose of health financing is to make funding available, as well as to set the right financial incentives to providers, to ensure that all individuals have access to effective public health and personal health care. Quality healthcare is a right, and should not be a privilege.
The healthcare financing system of a country defines the structure, the behaviour of different stakeholders and the quality of health outcomes (expressed in terms of mortality, morbidity and quality of life after seeking care).
Hence, the pattern of health financing is closely related to the provision of health services and the ability of a healthcare system to achieve the goal of healthcare for all.
Healthcare financing does not only involve how to raise sufficient resources to finance the healthcare needs of Nigerians, but also how to ensure affordability and accessibility of healthcare services, equity in access to medical services as well as guarantee financial risk protection. Healthcare financing is thereby important because it largely determines whether people can obtain the needed healthcare and whether they suffer financial hardship at the instance of obtaining care. In Nigeria, resource generation for health financing has been majorly through a taxed-based public sector, comprising of Local, State and Federal Governments.
The private sector finance their healthcare needs directly through out-of-pocket expenditures or indirectly through health insurance of their employees, including user-fees paid in public facilities like teaching hospitals, general hospitals and primary healthcare centres.
Currently, healthcare financing is heavily characterised by budget constraints. For example, the proposed budget for the health sector in 2015 was a paltry N259 billion – 5.8% of the total approved budget, far below the proposed 15% by the World Health Organisation, with 91% allocated to recurrent expenditure. Government expenditure of healthcare in Nigeria accounts for about 25% of total health expenditure while private expenditure accounts for about 75%. The dominant private expenditure is through out-of-pocket, and this has accounted for more than 90% of private health expenditures.
There is also an uneven distribution of resources amongst urban and rural areas. The rural areas have more than 70% of the disease burden but are mostly affected by inequitable budgetary health expenditure allocation. A practical approach to healthcare financing is for the government to increase the budgetary allocation to healthcare to that recommended by the World Health Organisation (WHO).
Financial resources channeled to meet health needs should be efficiently and equitably managed by cost-effectiveness analysis to seek alternative approaches to specific health problems, contracting out some services to individuals and companies(catering, cleaning, security services), creating an internal market where services are sold to one another in the same health-providing organisation, involvement of clinicians in management team to raise their level to cost of healthcare services, and comparing information about various segments of a health service provider establishment to enhance pressures on usual practices that could be modified to ensure efficiency.
The National Health Insurance Scheme should be aimed at covering majority of the population through public health service providers. Emphasis should be placed on the implementation of the scheme across all local governments. The National Health Insurance Scheme should be well designed, planned, managed, and effectively implemented towards achieving the Millennium Development Goals (MDGs).
Health financing cannot be handled in isolation. In Nigeria, the role of health economists must be recognised. Good governance, economic stability, and quality education must be in place to ensure its success.
The government must ensure strict adherence to the principle of healthcare for all and recognise health as the right of Nigerians. Financing and provision of public health programmes should involve preventive, environmental and promotional interventions to ensure sustainable healthcare for all.
By Akpan-Ekpo a medical student in the University of Uyo.