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Proposal to Implement a National Social Health Insurance Scheme in Zambia

Proposal to Implement a National Social Health Insurance Scheme in Zambia . Collins Chansa -MOH Henry Kansembe -MoH Michael Kachumi -CHAZ David Chilombo -PIA Anthony Dumingu -MoLSS Caroline Yeta -PRA. Introduction. Population: 12.2 (2007 proj.)

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Proposal to Implement a National Social Health Insurance Scheme in Zambia

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  1. Proposal to Implement a National Social Health Insurance Scheme in Zambia Collins Chansa -MOH Henry Kansembe -MoH Michael Kachumi -CHAZ David Chilombo -PIA Anthony Dumingu -MoLSS Caroline Yeta -PRA

  2. Introduction • Population: 12.2 (2007 proj.) • Under -5 mortality rate: 119 per 1,000 live births • Infant mortality rate 70 per 1,000 live births • Maternal Mortality: 591 per 100,000 • Poverty incidence; 64 percent • Extreme poverty; 46% • Gini-coefficient; 0.57

  3. Financing Sources (I) • As a % of the total GRZ Discretionary Budget, the health sector currently receives 11.5% • The major sources of funding for Public health services are GRZ (45%), Donors (55%) though SWAp, Direct Sector Support, Projects • As a % of Total Health Exp. GRZ 25%, Households 27%, Donors 42%, Employers 5%, Others 1% • As a % of GDP, Total Health Exp. Represents - 6.3% which translate to approximately USD$ 58 per capita (NHA 2006)

  4. Financing Sources (II) • Other sources include • User fees which until the scrapping in rural areas represented about 4%. User fees still remain an important source of financing for major hospitals like the UTH. • Medical levy (1% tax on interest earnings) which contributes about K8 billion annually.

  5. NHSP Financing Gap 2009-2010

  6. Justification for SHI • SHI is likely to be a more equitable health care financing mechanism than the current existing health care financing sources • Insurance schemes would subsidize services to the poor and vulnerable • General & disease-specific Household Exp. on health still very high. SHI will tap into this • SHI will play a complementary role in providing funding to the health sector and assist GRZ in meeting the Abuja Declaration of 15%

  7. What we have done so far • Comprehensive studies (from 1992 to 2008) looking at: • Resource flows in Zambia's Health system (NHA) • Health Facilities Census detailing available health facilities and equipment in Zambia • Six (6) joint appraisals of Zambia’s health reforms • Four (4) Demographic and Health Surveys showing population characteristics & common diseases • Costing of NHSP and BHCP • Two (2) studies profiling Catastrophic Health Expenditures (University of Cape Town & UNZA, 2008) • One (1) study on Policy Options for Health Care Financing

  8. What we have done so far ... • Detailed Actuarial Study (2008) Looking at: • The population to be covered to make the scheme viable • Break-even point • Premium rate that will cater for the benefit package envisaged • The benefit package • The rate of administrative expenses • Eligibility conditions to benefits • Projection of investments and reserves

  9. Description of the Proposed National SHI in Zambia • The national SHI fund shall be established by an Act of Parliament. The fund shall be administered by an autonomous institution/body • Scheme will be feasible when the contribution rate is at 5% of the Insured Person’s salary. The contribution rate will be shared by Employer & Employee (evenly or otherwise) • The scheme is expected to invest in safe opportunities such as treasury bills, fixed deposits and treasury bonds

  10. Description of the Proposed National SHI in Zambia • The scheme will initially cover the formal sector employees (public and private) who are estimated to be 495,277 in 2009 and projected at 739,337 in 2023 • This includes (i) Central Government (ii) Local Government (iii) Parastatal Organizations, and (iv) Private-sector Employees • The number of beneficiaries per single contributor will 6 (principle member, spouse & four children/dependants) • From the above, the total population covered initially will be 2,971,662 (22%) and increase to 4,436,024 (35%) by 2023 • At a later stage, it will be vital to expand the scheme to the informal sector

  11. Funding Sources & Cash Outflows

  12. Next Steps…. • Political process: mobilize support from donors Civil society, FBOs, private employers • Use actuarial model (Cabinet Office still studying report) to guide decision making including conducting more sensitivity analysis • Preparation of Policy documents and legislature on SHI • Documentation and Logistics • Marketing Strategy

  13. Anticipated Challenges • Re-investment, fund holder & institutional arrangements • Political Pressure, trade unions, co-payments by employers • Quality of health care services e.g. drugs • Extension of Coverage to informal sector & in rural areas • Information Communication & Technology • No User Fees, Community health Insurance. What will motivate people to contribute?

  14. END of Presentation I Thank You

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