The financing challenge for extending health insurance in low income and upper-middle income countries

During 2018, SOCIEUX + addressed unique challenges linked to the endogenous and sustainable funding of public health systems for the introduction of inclusive national health insurance coverage in two very different places. A total of five missions were conducted on this issue in 2018, corresponding to more than 200 days of technical assistance, divided between the Caribbean island of St. Lucia, and the southern African nation of Zimbabwe. They are very different places in terms of culture, ecology, politics, and institutional structure. Zimbabwe, a country in macroeconomic crisis, is listed among the world’s poorest nations. St. Lucia, on the other hand, is a small island that is part of the upper-middle income group. However, in both countries access to health care is haphazard and relies heavily on the ability of individuals and families to cope directly with the costs of consultations and treatment.

In both cases, SOCIEUX+ experts had counterparts in the respective health ministries who were competent, motivated, and eager to advance the political agenda for a broader and more inclusive public health care system. The key theme for both countries, as it immediately emerged, was to identify financing solutions for inclusive public health systems that would be sufficient, sustainable, fair, and well managed. While the situation in St. Lucia was straightforward, the condition of the public accounts of Zimbabwe required innovative ways to address their unique challenges. There, the concept of pooled funding was introduced, so that public, private (both insurance- and household-based expenditures), and external (public development assistance) funding could converge to provide sufficient financial resources to fulfil essential health functions.

In both contexts, SOCIEUX+ experts insisted on the mixed nature of the proposed health financing approach, with a significant but regulated involvement of private actors. In parallel, experts also insisted on the need to install regulatory and control functions that would be controlled by the state, which also needs to control the strategic direction of the reforms, based on inter-ministerial commitments. A second phase of the process, in both countries, would be defining the composition and costs of a benefits package, and the related costs of medical services covered by social health insurance. This quantification of costs would allow public authorities to understand and project the size of funds to be mobilized on a constant basis for a sustainable system. Finally, experts proposed that both countries define measures to improve the quality and efficiency of medical care, to avoid waste and increase users’ trust and satisfaction. The communication aspect of health care was also included in this roadmap, since the success of the reform relies of the emergence of a solid alliance between public and private institutions and users, as well as on the actual commitments, and accountability, of public authorities towards the reform.

It is worth remembering that a universal health care system would be a social game-changer in Zimbabwe, where a fragmented health insurance system covers less than 10% of the population, and out-of-pocket expenditures amount to around 40% of all health expenditures in the country. In St. Lucia, notwithstanding its economic dynamism, around 20% of households live at or below the poverty level, and a significant portion of the population lacks access to high-quality health care services.

In both countries the processes supported by SOCIEUX+ aim to a transition from a logic of individual responsibility towards health to one of a collective, public nature. At stake, there is the objective to achieve the goal of a drastic reduction of out-of-pocket expenses through the introduction of a strategy of contributions (premiums) to be paid in advance to take advantage of access to a basic benefits package. The mutualistic component, to be put in both cases, is a financial but also a cultural challenge of great importance for both countries whose populations are nowadays far from the generalization of concepts that, in Europe, represent a practice acquired for more than a century. Indeed, the choice these countries make is finally that of following a European model of sharing / mutualisation of risks along the path towards universal coverage.