Social Health Insurance: Should international agencies promote health insurance to achieve better HIV/AIDS coverage


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Social Health Insurance: Should international agencies promote health insurance to achieve better HIV/AIDS coverage

  1. 1. SOCIAL HEALTH INSURANCE Should international agencies promote health insurance to achieve better HIV/AIDS coverage? POLICY BRIEF FEBRUARY 2011This Policy Brief is the result of discussions taking Background on Insurance-based healthplace at the VIIth UNAIDS and World BankEconomics Reference Group meeting. systemsRepresentatives from each agency as well asprominent economists and researchers met todiscuss the linkages between social protection,social health insurance and HIV and AIDS. T here are three elements to a healthcare system (Figure 1). Population coverageMore information, including presentations made, describes how many people are covered. Servicecan be found on the ERG Secretariat‟s website: coverage describes the health services offered under the benefit package, and includes servicereference-group/seventh-meeting quality. Full service will cover all aspects of prevention, care and rehabilitation required by theSummary population. Cost coverage reflects both how much of the insurance premium covers major Explicit insurance does not offer a panacea for health issues and how equitably distributed costs are. HIV and AIDS service coverage. Where an insurance-based health system is Figure 1 already in place, it can be expanded to include HIV and AIDS services. Introducing SHI is complicated and will take time to cover all people. The process should not be rushed and existing mechanisms should continue. This means that some people will continue to be inadequately covered - they should not be forgotten. Political commitment indispensable for inclusion of HIV services in any coverage mechanism. A political-economy lens will be useful to adopt. Financial feasibility is key. External funding Taxed-based financing systems involve the may be necessary at the start and then provision of health services at no charge at the gradually be replaced with government funds. point of use to citizens and is funded by Not all people will be able to contribute to the government taxes. Population coverage is scheme. Subsidies will play a central role. therefore high. Explicit insurance is financed by contributions (premiums) by individual members who subscribe Health Economics and HIV/AIDS Research Division University of KwaZulu-Natal, Westville Campus, J block, Level 4, University Rd, Durban, South Africa Tel: +27 (0)31 260 2592 | Fax: +27 (0)31 260 2587 | |
  2. 2. to various levels of health care coverage. Social Generally, most HIV and AIDS services regardedhealth insurance and „private health insurance‟ as „private goods‟ are insurable. In this case, theare distinct forms of this kind of insurance model. net benefit of being insured for the financial costs of a potential future HIV-related health risksCountries generally have a mixture of several accrues to the insured person. Insurancetypes of health schemes at any one time. Where protects the individual agent from individual orprovisions for the poor continue to be insufficient, idiosyncratic risk, and it thus becomes in theiror when accessing healthcare requires user-fees interest to protect themselves. This includesand high indirect–costs, then OOP will continue to PMTCT, hospitalisation and treatment ofbe a key means of financing healthcare. opportunistic infections and ARV treatment.In many resource-poor countries, healthcare is Public goods are not regarded as insurable. Thisfinanced by households, which are often left is where the net-benefit accrues to the public andvulnerable to catastrophic healthcare costs. SHI is therefore seen as part of wider healthschemes aim to increase the provision of formal promotion. Non-insurable HIV and AIDS serviceshealth services and reduce these costly out-of- include mass HIV awareness campaigns, HIVpocket expenditures (OOP). The pooling of testing and distribution of condoms. These costsresources into one large basket allows for must be borne by public finances.diversification of risk and acts as pre-payment forfuture use of health care. The pre-payment The potential for adverse selection is a concern.mechanism is an effective way to alsoincrease Those who know they are HIV positive (orcoverage of, and access to, health services. recognise they at high risk of becoming so)Insured households are less likely to experience subscribe to an insurance package specifically todisastrous healthcare costs that lead to increased receive AIDS treatment. This increases costs andhousehold financial instability.1 thereby insurance premiums for all.SHI and HIV and AIDS services What does the evidence say?Universal coverage is the ideal goal of any public Doetinchem, Lamontagne and Greener‟s review2healthcare system. In HIV-endemic countries, of health insurance schemes in a selection ofhealth systems need to provide and finance both countries, finds “no HIV-specific variables thatpreventative and curative services. These have led countries to include HIV-related servicesservices pose a real challenge in terms of cost. A within the coverage of a health insurance or tobenefit package that includes HIV and AIDS- keep it separate through public provision”.related services will be expensive. Donors to Countries that do provide HIV-related servicesdate have filled the resource-envelope by either have strong health systems already or areproviding assistance for treatment and prevention seeking to improve it.specifically for HIV and AIDS. As a consequence,funding silos have been created, encouraging a In a multi-country study of SHI programmes,vertical approach to health financing. There is a Bitran3 shows that if insurance already exists andneed to move from „AIDS exceptionalism‟ to covers a significant share of the population, then„health exceptionalism‟ and explore alternative HIV and AIDS services should be incorporated.models of health care financing, such as SHI, that This is provided that enough financial resourcescan include HIV and AIDS health services. are available to make it feasible. In cases of low insurance coverage, expecting providers to cover HIV and AIDS services into the benefit package immediately will be premature.Can HIV and AIDS services be insured? 2 Doetinchem, Lamontagne and Greener (2010)1 Scheil-Adlung, Jütting, Xu et al. 2005 3 Bitran, Ricardo Health Economics and HIV/AIDS Research Division Khaled Ahmed, Alan Whiteside and Ilaria Regondi
  3. 3. Other evidence points to a role for externalfunding to play in the provision of HIV and AIDSservices within a social health insurance scheme.Lange provides an example of the Dutch-funded For more information, pease contact Khaled Ahmed:Health Insurance Fund (HIF) in Nigeria and that covers basic health care, includingtreatment of HIV and AIDS, tuberculosis andmalaria. Insurance premiums were subsidised, HEARD is the Secretariat of the World Bank UNAIDSalthough members made co-payments. Local Economic Reference Group. The statements, findings,health maintenance organisations are responsible interpretations and conclusions presented in this paperfor financial management and for the quality of do not necessarily reflect the views of UNAIDS norcare. Preliminary results find that long-term donormoney acted as long-term collateral which those of the Executive Directors of the World Bank orreduced the risk for private investors. This the governments they represent.attracted external investments which vastlyincreased the availability of money for healthcare.In this way, the HIF scheme increased thedemand for, and supply of, healthcare.ConclusionExplicit insurance does not offer a panacea forHIV-service coverage. There is nothing specificto health insurance that makes it particularlyunique to boost efforts to expand population andfinancial coverage of HIV and AIDS services.Where an insurance-based health system isalready in place, it makes sense to expand it andto build HIV and AIDS services into it - whether inthe cost, service or population coveragedimension, or in all three. This will be more cost-effective than creating separate HIV and AIDSservices that require continuation of verticallyfunded HIV and AIDS programmes. In this way,donors can streamline funding and adopt a„horizontal‟ approach to HIV and AIDS funded thatis part of the main health system.Availability of financial resources is key. Countrieswith currently low health insurance coverageshould not wait for the sector to develop firstbefore governments attempt to expand services.Rolling out an insurance-based health schemewill depend critically on public subsidies for it.Donor assistance may initially be required tosupport the expansion of HIV and AIDS services.While domestic capacity to implement andmanage a national health insurance scheme iscritical, many developing countries lack goodsystems to implement compulsory contributions. Health Economics and HIV/AIDS Research Division Khaled Ahmed, Alan Whiteside and Ilaria Regondi