Draft ToR for assessment survey of community based micro health insurance

Save the Children Federation, Inc.

Sabal Development Food Assistance Program
AID-OAA-A-15-00002
Terms of Reference: Community Micro-Health Insurance Study

1. Introduction
Remote, mountainous regions in Nepal struggle with declining income opportunities. Despite national
improvements in poverty, food insecurity, and malnutrition, many rural households (HHs) remain poor or
extremely poor and unable to absorb shocks or adapt to changing conditions. In 2011, 41% of Nepali
children aged 6–59 months were stunted and 29% were underweight. 1 Wasting affects 25%–30% of
children aged 6–18 months. Moreover, 29 village development committees (VDCs) in Sabal districts
report that 40% or more HHs endure chronic, severe food insecurity. Poverty rates in the eleven targeted
districts in the Central and Eastern Hills range from 20% to 38%. These are expected to increase by 2.5 to
3% as a result of the April and May 2015 earthquakes. 2 For poor HHs, a single event, such as the
earthquakes, have the potential to plunge a HH into long-term debt or lead to the selling-off of key assets.

The Government of Nepal (GON) has made a significant efforts to promote policies that improve access
to and utilization of health services by poor and marginalized populations. The introduction of free
essential health care has been an important step towards this goal. Since the 1990s, the Ministry of Health
has held numerous discussions on the pros and cons of free health care versus insurance to provide social
protection in health access. In 2003, the GON piloted the Community-Based Health Insurance (CBHI)
program through the MOH. Save the Children began implementing a community based micro-health
insurance (MHI) scheme in 2 districts (Dhadhing and Banke) in 2010. The Government of Nepal has
recognized the program as one of Nepal’s most successful pilots to date and has begun to replicate and
scale the model in its own Social Health Security (SHS) program. In 2016, that program was re-
established as Social Health Security Development Program in three districts in Kailali, Baglung and Ilam
and will expand to 22 more districts (altogether 25 districts) in coming fiscal year. Save the Children has
received strong commitment from the GON to include at least two Sabal’s targeted districts, Makwanpur
and Sindhuli, in the FY16 rollout. SC is also advocating for the inclusion of Udayapur district based on its
high vulnerability. The GON anticipates a complete nationwide rollout of the program to all districts
within three years.

Save the Children (SC), through the USAID-funded Sabal Sustainable Action for Resilience and Food
Security program, will support the effective implementation of the GON’s Social Health Security
program in areas where the rollout has already been planned and will initiate SC’s community-based
Micro-Health Insurance (MHI) scheme in 1 program district, Okhaldhunga, not targeted by the GON. It is
anticipated that this community based MHI will help lay the foundation for the GON’s ultimate
nationwide rollout. To this end, SC seeks a consulting firm to conduct an study to assess communities’
willingness to pay, incidence and pattern of illness, costs, and map the availability of relevant health
services (including government and private sectors at district headquarter and VDC level), as well as

1
2011 Nepal DHS
2
Post Disaster Needs Assessment, Government of Nepal, National Planning Commission 2015

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Sabal Sustainable Action for Resilience and Food Security
Terms of Reference: Micro- Health Insurance Assessment
Revised July 2016
Draft ToR for assessment survey of community based micro health insurance

healthcare provider availability and quality (include community perception of and level of satisfaction
with services currently available).

2. Program Background
Save the Children (SC), in consortium with numerous local and international partners, is implementing
the “Sustainable Action for Resiliency and Food Security” (Sabal) program in 11 districts of central &
eastern Nepal (Makawanpur; Sindhuli; Ramechhap; Okhaldhunga; Khotang; Udaypur; Nuwakot;
Rasuwa; Kavre; Sindhupalchowk and Nuwakot districts). Sabal is designed to address root causes of
poverty (food insecurity and malnutrition, and households’ inability to absorb shocks from disaster or
adapt to climate change impacts). Contributing factors include: poor market access; limited access to
improved seed, fertilizer, or micro-irrigation; a lack of local off-farm employment opportunities;
household labor shortages due to long-distance migration, and limited access to financial services,
impeding efficient transfers, reliable saving modalities, and productive investment of remittances. Factors
leading to poor nutritional status include low dietary diversity; poor health, hygiene, and nutrition
behaviors; lack of access to safe water, latrines, and quality health and family planning services, and
women’s lack of control of household economic resources. In addition to a changing and fragile climate,
targeted rural households face agricultural, public health, and price shocks, as recently witnessed after the
2015 earthquakes and economic border blockade. Without access to public services, social protection
programs, insurance products, or institutional savings, the rural poor remain exposed to such risks or fail
to fully recover from shocks.

Sabal’s Purpose 1 (Livelihoods) is designed to increase the stable income of communities and
households, especially vulnerable females and males, through vocational & entrepreneurship training,
adoption of climate-smart agriculture & livestock practices, post-harvest management, natural resource
management, small-scale technology, value chain financing, micro-financing activities and improved
economic risk management capacity of vulnerable households. A key sub-sector under the livelihoods
component is improved capacity to mitigate and manage risk through access to social protection services
and safety nets. In Nepal, poor families are unable to access needed health services, in part, due to the
high cost of services. When already impoverished households do seek urgently needed care, they may be
forced to sell critical livelihood assets and/or fall deeply into debt. Financial accessibility of health
services is one of the strongest determinants for improving the health status of poor and vulnerable
families and building resilience.

At present, health insurance coverage in Nepal is low, with only 5% of the population insured and even
lower coverage rates among poor and rural populations. Finding alternative ways of effectively protecting
the population from health risks and increasing funding for health care in Nepal is a big challenge. To
protect the livelihoods of vulnerable populations and enable poor HHs to exercise their right to access
needed health services, Save the Children (SC), together with Development Project Service Center
(DEPROSC) Nepal, NIRDHAN and the Micro Insurance Academy (MIA), developed and implemented
the Community-Based Micro Health Insurance (CBMHIP) pilot project in Dhading and Banke from
2010-2013. Although the project initially struggled to develop the most effective implementation
modality, the pilot intervention has achieved important results and generated significant learning on
effective CBMHI program implementation. The Government of Nepal applauded SC’s efforts in
community-based MHI and has formed a special “Social Health Security Development Committee”
under the Ministry of Health tasked with the gradual expansion of the program. Through the Sabal
program, SC will use the learning generated by the CBMHI program to improve the health status of
households, particularly of women and children, in 4 Sabal districts i.e. Makawanpur, Sindhuli, Udaypur
and Okhaldhunga.

3. Objectives of the consultancy

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Sabal Sustainable Action for Resilience and Food Security
Terms of Reference: Micro- Health Insurance Assessment
Revised July 2016
Draft ToR for assessment survey of community based micro health insurance

The overall objective of this consultancy is to collect context specific data in the 4 districts selected to
provide the complete health related information needed to recommend appropriate MHI premiums and
packages for each district. In Makwanpur, Sindhuli and Udayapur, where GON SHS is planned, a gap
analysis in government services will be conducted. In addition to collecting relevant health related
information, the study will also assess community perception and needs related to health services to
inform the Government-led SHS. In Okhaldhunga, where SC will directly implement community based
MHI, the study will collect comprehensive health information needed to design the MHI premium and
modality. Specifically, the study will seek to document and collect the following:

 To document demographic information (family members, age, education, employment) of the

sample respondents;
 To document all sources of income of the targeted communities, including formal and informal
employment, remittances, and other sources;
 To assess the nature of illness and treatment patterns;
 To identify health seeking behaviors of the communities;
 To map the health service providers in the community ( Public and private, services, facilities,
HR);
 To assess the type of health facilities (institutions) used when HH members become ill;
 To understand community perception and satisfaction with current health services.
 To understand community willingness to pay for services and what would be needed to
encourage them to pay for services.
 To identify the constraints and opportunities of MHI in targeted community
 To determine the typical expenditures incurred by target communities for health services,
including treatment and management and understand borrowing patterns;
 To calculate the premium paying capacity using Save the Children’s tested methodology for
determining an MHI premium; and,
 To propose the insurance products/packages based on Save the Children’s tested framework for
MHI products/packages.

4. Proposed Methodology, Suggested Areas of Study and Expected Deliverables

The assessment should be based on primary information; however, relevant secondary information may
be used where applicable. To gather qualitative and quantitative information/data, the consultant(s) is
expected to use appropriate methodologies to ensure the expected outputs and objectives of the study are
met. Key informant and in-depth interviews and focus group discussions (FGDs) should be carried out
with relevant stakeholders with an explicit focus on gender balance and social inclusivity.

a. Suggested Areas of Study:

o Brief demographic profile of the target population
o Main occupation and sources of income
o Toilet construction, use, and hygiene,
o Health related problems, treatment location, transportation mode, rate of hospitalization,
and expense patterns in the last 5 years:
i. Morbidity patterns and causes
ii. Rates and types of illness episodes among age groups by gender
iii. Frequency of health checkups, both routine and emergency
iv. Incidence of acute/chronic illness by age group and gender
v. Length of illness
vi. Existence of medical service providers by type (doctor (private/government),
traditional practitioner etc.) in the area and frequency of visit to community.
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Sabal Sustainable Action for Resilience and Food Security
Terms of Reference: Micro- Health Insurance Assessment
Revised July 2016
Draft ToR for assessment survey of community based micro health insurance

vii. Treatment seeking behaviors (private clinic, private hospital, health post/sub-health
post, government hospital) and reason for selection, distance and quality of health
services
viii. Existing health service providers (hospitals, health service centers, polyclinics,
mission hospitals) and facilities provided by them
ix. Distance to reach hospital (means of reaching to nearby hospital and level of
difficulty in reaching hospital)
x. Types of health service providers selected for different types of illnesses by
wealth/income group
xi. Became ill but did not go to a hospital (may be due to lack of money, nearby health
facilities, consultations with FCHVs and/or local pharmacies?)
xii. Annual Household expenditure on health care (hospitalization, imaging, lab test,
medicine, transportation and others)
xiii. Hospitalization days with expense
xiv. Sources to finance health care expenses (own, borrowing, borrowing sources, interest
rate as well as condition)
xv. Loss due to illness i.e. away from normal work an average of XX days and to assess
the relative financial loss of absence with the premium that they would be required to
pay under MHI.
xvi. Repayment of loan (how, when and difficulty in repaying the loan)
xvii. Shock and stress realized during emergency illness, difficulty in loan borrowing and
repayment
xviii. Mode of transport used and its expense
xix. Satisfaction with existing health care services
xx. Barriers to receive quality health services and what would encourage them to use the
health services when needed
xxi. Types of risk coverage package preferred
xxii. Knowledge about health insurance (whether they have about it or not)
xxiii. Perception about health insurance (positive or else)
xxiv. Member’s willingness to pay for health insurance
xxv. Gap between the willingness to pay for health insurance, actual health spend and the
proposed premium

b. Suggested Methodology
The sources of information for this study include quantitative information (obtained through a household
survey, data from various sources), qualitative information (obtained through Focus Group Discussions
(FGDs) with groups of prospective affiliates in the micro health insurance, health services, medicine
traders, traditional health practitioners, members of mother groups; community forest users group,
leasehold forest users group; and other health related groups). Key informant interviews to collect
information on the providers, community socioeconomic profiles, health seeking behaviors, incidence of
illness, health service payment mechanisms, perception, preference, and priorities with regard to health
insurance, factors affecting willingness to pay for health insurance and the current status of health service
delivery. The consultant(s) will have to propose various methodologies and models to collect data and
develop statistical analysis tools. Secondary data collection from district public health office, CBS and
other related government agencies may be required as well.

Scoping of the Study: Once selected, the consultant team will work with Sabal staff to finalize a detailed
study plan. The scope will function as a well-defined study framework and outline the magnitude of
literature/desk review, methodologies and data collection tools, timelines for field visits, and list the
number and type of key agencies and stakeholders to be interviewed.

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Sabal Sustainable Action for Resilience and Food Security
Terms of Reference: Micro- Health Insurance Assessment
Revised July 2016
Draft ToR for assessment survey of community based micro health insurance

Desk review: The study will conduct a detailed literature review on the GON-SHS, micro health
insurance, community based micro health insurance, micro financing of MHI and CBMHI in Nepal and
internationally, packages and premium, operational modality, financial viability and program
sustainability.

Field Study: The study team will visit select VDCs in the proposed districts. The Sabal district team will
select 4 high potential VDCs with existing, accessible nearby health posts/private health services. Sabal
beneficiaries, non-beneficiaries and beneficiaries of related, other programs will be interviewed. Health
service providers and other stakeholders will also be interviewed.

Focus group discussions: Focus group discussions will be held to obtain information on health seeking
patterns; medical expenses and management of those expenses, morbidity and premium calculations in
different areas on the basis of willingness to pay.

Key informants: Key informants should include government/non-government health staff including
MOH and DHO, traditional health practitioners (Dhami & Jhankri), pharmacists, government records and
private health centers/clinics, as well as other NGO’s/donors involved in this sector. Members of mothers
groups and safe maternity service providers, child care service providers, representatives from community
forestry users group/leasehold forestry users group, community water management groups, and
community based saving & credit cooperatives will also be interviewed.

Study Location: This study will be conducted in 4 districts i.e. Makawanpur, Sindhuli, Okhaldhunga and
Udaypur. In total, 1000 (at least 825 groups) groups will be surveyed. The list of target VDCs, locations
and sample households will be finalized by consultant and the project team. A minimum of 4 VDCs per
district will be selected for sampling purposes. Though the study not be conducted at the national level,
SC will actively engage relevant stakeholders to ensure consistency with GON plans.

c. Deliverables
The following deliverables are to be submitted to Save the Children:

o Study plan including a detailed survey implementation plan that:

o Specifies details on the methodology, critical tasks, anticipated outputs, date-bound
timelines, resource needs, and responsible person(s); and,
o Outlines the composition of the data collection/survey team, including expected tasks
and responsibilities of each team member.
o Kick-off meeting to be held at SC’s offices in Kathmandu
o Post-field work debrief for Save the Children and its partners to present findings,
conclusions, lessons learned, and recommendations based on the assessment (PowerPoint).
o Draft assessment report
o Final assessment report: A comprehensive analytical report containing relevant data and
information with appropriate and clear-cut recommendations for the development of a micro-
health insurance pilot program is the final output of the study. The report should be responsive to
this TOR, forward-facing and designed to serve as the resource base for further study or other
relevant activities. Excluding the Cover Page, Table of Contents and Annexes, the report should
be a maximum of 25 pages, single-spaced and in Times New Roman 12 point font, and formatted
as follows:
o Cover page, Table of Contents, List of Acronyms
o Executive Summary

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Sabal Sustainable Action for Resilience and Food Security
Terms of Reference: Micro- Health Insurance Assessment
Revised July 2016
Draft ToR for assessment survey of community based micro health insurance

o Introduction
o Program Background
o Methodology
o Findings
o Conclusion and recommendations
o Annexes
 Electronic versions of the raw data of collected, information on and contact
details for all respondent and all SPSS/Excel files, pursuant to the requirements
of USAID Development Data Library and USAID’s Office of Food for Peace
needs.
 Calculation of premium and combination of benefit packages
 Presentation of final report in a workshop organized by Sabal.

5. Ownership of Research/Data Findings

All data collected for this study shall remain the property of Save the Children. Any work product
resulting from this review must cite the participating partners and USAID, and include relevant Sabal
staff as a primary or contributing author.

6. Reporting, Coordination and Responsibilities

a. Reporting: The Consultant(s) will report to the Kathmandu-based Senior Advisor for
Financial Services, though the study will be conducted under the overall supervision of the
Sabal Chief of Party, who will approve the final report.

b. Coordination: At various stages of the assignment, staff in Nepal and the US will provide
consultative input to assist the firm selected.

c. Responsibilities of Consultant: In consultation with project team, the consultant(s) will have
to complete the assessment survey work and submit reports both soft and hard copy on time.

d. Responsibilities of the Program: Sabal will make available all appropriate program
documents and other key information necessary to complete this assignment. Logistical
support will be provided by the Senior Advisor Financial Services or his designate at the field
level.

7. Timeline and Budget

The duration of this task shall be a maximum of 60 days from the date of the signing of the contract. This
work is expected to begin in July 2016.

Fund Disbursement: This work will be contracted through a fixed price mechanism, through which
payments will be disbursed in 3 installments: 1) 25% after signing the contract; 2) 25% after submitting
the draft report; and, 3) 50% after completion of the final deliverables. The last installment will only be
disbursed upon clearance from the Sabal Chief of Party.

Budget: The maximum amount available for this study is NPRs 1,000,000.00 (NPRs One million) only.
Expressions of Interest that exceed this amount will not be considered.

8. Submission Requirements and Evaluation Criteria

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Sabal Sustainable Action for Resilience and Food Security
Terms of Reference: Micro- Health Insurance Assessment
Revised July 2016
Draft ToR for assessment survey of community based micro health insurance

A complete expression of interest will include the following:

Technical Proposal: The technical proposal should outline the proposed methodology and provide a
description of the proposed data collection tools to be used. Please note that the technical proposal should
reflect all deliverables in this TOR as well as a weekly update report to Save the Children on
progress/findings (weekly update not to exceed two pages).

As part of the technical proposal, please provide an estimated timeline for conducting the assessment.
This timeline should reflect actual availability of the proposed individuals. A statement on the applicant’s
technical (proposed consultants) and operational capacity to complete the assignment should also be
included.

Cost Proposal: A realistic budget should be submitted by the applicant along with a technical proposal
that is responsive to this TOR. The budget should include all costs associated with the completion of this
assignment, including but not limited to: consultant fees; ground and/or air travel, if applicable;
enumerators/researchers; and, other costs. The consultant shall bear all tariffs, duties, and applicable
taxes or charges levied at any stage during the execution of the work. The cost proposal should not exceed
the total amount listed in Section 7 above. No costs associated with the development and/or submission of
an application in response to this TOR will be reimbursed.

Other Annexes: Documents to be included as annexes with the submission of the expression of interest:

 A copy of the final technical and financial proposals in line with the ToR.
 Signed copies of CVs of the proposed professionals and their relevancy.
 Flow-chart and timeline of activities (to be included in the technical proposal).
 Statements and documents, if any, acknowledging the individual’s and /or company’s capability and
details of similar assignments.
 Any other relevant documents.

Evaluation Criteria: A technical review committee comprised of members of the Sabal Senior
Management Team will be established to: finalize the ToR; review Expressions of Interest (i.e., technical
and cost proposals); select a consulting firm; and, review and finalize the report. The Sabal Senior
Advisor for Financial Services will be responsible for coordinating with the consulting firm to ensure on-
time completion of the assignment. Expressions of Interest will be evaluated as follows:

- Qualifications of Proposed Staff – 40%

- Technical Proposal – 35%
- Cost Proposal – 25%

Availability to initiate this work within a week of selection is preferred.

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Sabal Sustainable Action for Resilience and Food Security
Terms of Reference: Micro- Health Insurance Assessment
Revised July 2016