HEALTH CARE FINANCING

BY
DR EMMANUEL AFOLABI AMAO, FMCGP
MEDICAL DIRECTOR SHALOM MEDICAL CENTRE.
SABO, OGBOMOSO
Special greetings from Athens
 LECTURE OUTLINE
• OBJECTIVE OF THE SESSION
• DEFINITION/INTRODUCTION
• SOURCES OF HEALTH CARE FINANCING
• CHALLENGES OF HEALTH CARE FINANCING
• SOME SUGGESTED SOLUTIONS
• CONCLUTION
 OBJECTIVES OF THE SESSION
• To define Health care Financing
• To discuss some possible sources of financing
health care
• To enumerate some challenges facing health
care financing
• To explore and suggest some possible
solutions to the challenges
 DEFINITION/INTRODUCTION
• This is a process of making funds available to provide
people with acceptable health care.
• Health is a state of physical, social, mental and spiritual
well being, and not a mere absence of disease or ailment.
It must be culturally acceptable, accessible, affordable and
available to all.
• Health Care Financing is the responsibility of the entire
population and should not be left to the government alone
if it must meet the required needs.
• Different countries have different ways of meeting the
health needs of their populace.
 DEFINITION/INTRODUCTION
• Health care financing does not only involve how to
raise sufficient funds to finance health care needs of
countries, but also on how to ensure affordability
and accessibility of health care services. It also
include equity in access to medical services as well as
guarantee financial risk protection.
• How health care are financed largely determines
whether people can obtain needed health care and
whether they suffer financial hardship at the
instance of obtaining care(I).
 DEFINITION/INTRODUCTION
• The funding of health care in Nigeria is inadequate with budgetary
provision hardly exceeding 3% of nation’s total budget
• Public Health Care expenditures is 20-30%
• Private expenditures accounts for 70-80%
• The dominant private expenditure is through out-of-pocket
accounting for more than 90%
• Most government of developing countries would usually complain
of short fall in revenue allocation received from the central
government as the reason for poor health care financing.
• There is high levels of infant mortality and morbidity rate
associated with high incidence of out-of-pocket payment(1)
FG capital and recurrent expenditures to the
health sector in 2003 and 2007
• FG expenditures on health 2.6% in 2003, 5.2%
in 2004, 4.2% in 2005, 5.8% in 2006, 5.5% in
2007. Health sector allocation got to the peak
in 2006 after which it stated to decline in
subsequent years.
 SOURCES OF HEALTH CARE FINANCING
• Community mobilization for participation in heath care
• Cooperative health care contribution
• Out of pocket financing
• Health insurance e g NHIS
• Government completely funding health care such as
‘Free Heath Care at all levels’
• Foreign Agencies funding an aspect of health care such
as UNICE,USAID, CDC, Damien Foundation, APINS,
Missionary Organizations, PEPFAR, WHO, etc
• Philanthropic individuals
 Community mobilization for participation in
heath care financing
• Principle of community mobilization
• Process of community mobilization
• Community participation
• Advantages of participation in heal care financing
• Outcomes of community participation in health care
• Challenges in community mobilization and
participation in health care financing
• Role of family physicians in community mobilization
for participation in health care
 Cooperative health care contributions
1. Different cooperative or associational bodies in the community
coming together to form a cooperative body for the purposes of
financing health care for members at a reduced cost e g
Mechanics, Market women, bricklayers, Farmers etc.
2. Existing established organizations/association mobilized to
embark on specific health care project for their communities
3. Established cooperative bodies investing some of their business
returns to finance health care for their members and other
members of their communities
4. Cooperative bodies approaching government and non-
governmental organizations for supporting a specific health
related project in the communities
 Out of pocket financing

• This forms the largest percentage of health care financing in

Nigeria
• Individuals paying for health care of him/herself and the
family
• Health service utilization is more effective with this mode of
health care financing
• Factors affecting individual and family finances are likely to
affect patronage to health care facilities
• This form of financing is actually encouraged by the non
performance of ‘free health system of care’ and indirectly
responsible for the unacceptably low health indices.
 Health insurance e g NHIS
• This is a form of insurance where an individual contributes
certain amount of money that is kept with government
contributions for health care of the individual and his/her
family.
• The funds contributed are put together and administered
by Health Management Organizations (HMOs) for
disbursement to various health care facilities (providers).
• Individuals need to register with the National Health
Insurance Scheme (NHIS)
• Presently this is applicable to salary earners in most cases;
either government or private civil servants.
 Government completely funding health
care such as ‘Free Health Care at all levels’
• This mode of health care financing was practiced in
the past by some states in Nigeria and maybe some
other ones in the present political dispensation. It
has both advantages and disadvantages.
• If health care is seen as a social service to the people
this is actually the best for a tax paying community!
• What will you do if you become a governor of a state
in Nigeria? How will you handle health care financing
if you are appointed minister of health?
Foreign Agencies funding an aspect of health
care
• UNICEF,USAID, CDC, Damien Foundation, APINS,
Missionary Organizations, PEPFAR, WHO, etc
• Each of these donor agencies have specific health
target to fund e g Reproductive Health, APINS HIV?
AIDS care
• Missionary organizations are classified as not for
profit health care providers. The body usually have
funding from overseas e g Baptist health care is
funded by USA Southern Baptist, SIM by
Multinational Agencies etc.
 Philanthropic individuals
• These are individuals in the society that fund
health care for the less privilege in the society
• These are not many in our society but such
group must be encouraged for the good
gesture
• Enabling economic environment is essential
for business to thrive and encourage the
willing individuals
CHALLENGES OF HEALTH CARE FINANCING

• Ignorance
• Poverty
• Value
• Political
• Socio-cultural factors
• Global Economic Recession
• Corruption
 SOME SUGGESTED SOLUTIONS

• Political stability and Political will to provide

standard health care for the populace
• Economic empowerment programmes
• Better government health policy for affordable
health care
• Adequate manpower training and development
• Tackling the evil of corruption wholistically and
with good intention
 Summary
• Health care financing is such a broad topic that needs extra
time to do justice on
• There are different approach to the subject matter
• NHIS and Private Health Insurance is a Golding step that will
solve our health care problem, if well executed
• When you do get to the top politically, remember that you
are sent there to improve the heath status of your nation, so
do not forget to offer your best possible
• Who knows whether for such a reason you were sent to such
position of authority.
• SHOLOM!!!