Ghana – the NHIS: Countrywide health insurance coverage based on mutual health insurance schemes?

As of the 5th of January 2009, the National Health Insurance Scheme in Ghana has gone into the 6th year of its operation. Again, this will be a challenging year for this countrywide endeavour: First, the political mother, the New Patriotic Party (NPP), just resigned from government as John Atta-Mills from the National Democratic Congress (NDC) won the presidential election.

This change might lead to a different commitment to the system by the government, and also might have impact on the future direction of the scheme. The NDC announced to base the system increasingly on a tax-financed foundation. The second challenge is that the NHIS, which is currently financed by member premiums, by deductions from formal sector workers and an earmarked percentage of the value added tax, is adversely affected by strongly rising costs which – assuming  appropriate measures are not taken – will increasingly drive district mutual health organisations into distress (and many may have to apply for additional governmental subsidies to top up the dissolved risk pool’s funds). By organisational design, the district mutual schemes are independent entities with own revenues (administration fees and premium) by their members who work in the informal sector and revenues added by the National Health Insurance Fund for administrational expenditures, but also for coverage of exempt groups (i.e. children below eighteen where both parents hold an insurance card, the very-poor and the elderly above 70 years) and groups who paid otherwise (formal sector workers).This fundamental design is the result of many years of bad experiences with catastrophic out-of-pocket payments for health care due to the so-called “cash and carry” system and the increasingly successful mutual health organisations that rapidly spread out in the country since 1992 in order to give access to appropriate health care financing.

Using fundamental elements of mutual health insurance schemes, the set up district wide mutual health insurance schemes were designed to be financially and structurally independent entities and to form its own risk pool. As the National Health Insurance Act came to effect in 2004, many (but not all) micro health insurance units decided to change their structure to become district wide mutual health insurance schemes. Within just five years, the district wide mutual health insurance schemes covered (end of 2007) over 8 million people in Ghana representing over 42% of the entire population.