National Health Insurance Scheme: Health Care For All

PART 1

?The first wealth is health?.

?In health there is freedom. Health is the first of all liberties?.

?It is health that is real wealth and not pieces of gold and silver?.

This article will be divided into two parts. Part 1 will concentrate on the introduction of user fees (cash and carry) into the Ghanaian health care system and the effects it had on the general populace especially the poor. Part 2 of the article will present a synthesis of the National Health Insurance Scheme and outlining the resulting problems, challenges and recommendations.

Ill health and disease are now recognised as barriers to economic growth in developing countries. Health before wealth is more than just an old adage and programmes that aim to protect and improve the health of people can help in the battle against poverty. Good health boosts labour productivity, educational attainment and income and so reduces poverty. A country?s economic development is closely interrelated with the health status of its population and efficient and equitable health care system is therefore an important instrument in breaking the vicious circle of poverty and ill health.

Ghana was the first country in sub-Saharan Africa to win independence from the British and her future was ever so bright. Under the leadership of Dr. Kwame Nkrumah, Ghana set up a National Health Service which was fully financed from state revenue. The advantage of this system was that, it was progressive (high income individuals paid higher taxes than low income people). It also provided service for everybody without any costs, so it protected the poor people from financial shocks. It did not involve user charges at point of service. The disadvantages, however, were very clear in that, the medical services provided were indeed low quality and it was biased towards the urban populace and neglected the rural poor.

In 1971, the government introduced user fees to patients for hospital procedures. Initially, the fees were small but, the principle was established. By the early 1980s, Ghana was experiencing balance of payments crisis which was soon generalised into an economic crisis which affected all sectors of the economy. Thus, not only did Ghana experience a general decline in agricultural productivity and exports which included declining world prices for cocoa and gold, but a shortfall in foreign exchange earnings which impacted negatively on import-dependent manufacturing firms. Furthermore, consumer goods shortages, inflationary pressures, and unemployment gradually built up and the situation was made worse by the resort to deficit-financing via external borrowing. By this time, Ghana?s balance of payments was in disarray, budget deficits were ballooning and foreign investment flows had nearly dried up. By 1983, Ghana the shining star of Africa was bankrupt, unable to feed herself, unable to pay her workers and was reeling under a huge debt. Ghana?s debt crisis can be attributed to waste, corruption, domestic economic mismanagement, oil shocks of 1973-1974 and 1979-1980, global high interest rates in1980-1982, global recession in 1981- 1982, declining world wide prices for cocoa and gold, and large contracted loans which were used for unproductive projects making repayments difficult.

With the Ghanaian economy literally on the verge of bankruptcy, the once shining star of Africa had no choice but to accede to the demands from the IMF and the World Bank for market reforms which led to the introduction of the structural adjustment programme in 1983. The programme was about shifting the structure of incentives in the economy away from non-tradeables to tradeables. Central to this was the goal of getting prices right by withdrawing subsidies, liberalising the domestic and external trade regime, and pursuing a more ?appropriate? exchange rate policy i.e.: currency devaluation. In Ghana and across Africa, structural adjustment was foisted on one country after the other, and efforts were made to dismantle agricultural marketing boards, privatise, commercialise, liquidate state-owned enterprises, deregulate various aspects of the economy, reduce the size of the state bureaucracy through civil service retrenchments, encourage the private sector, and promote the embrace of the market.

Structural adjustment was very much concerned about balancing budgets and servicing public debt both domestic and external. To do this, there were budget cuts on social spending with education and health bearing the heaviest brunt. Slowly but surely, the government was forced to introduce cost recovery into the health system in Ghana. This was popularly known as ?cash and carry?. This system was a product of the structural adjustment programme which the IMF and the World Bank had prescribed and which, Ghana readily adopted. It involved the wholesale withdrawal of government subsidies on health delivery. Under the cash-and carry system, patients were asked to pay for full cost of medication and care. Due to economic crises and mismanagement, the government had to reduce spending on health and social affairs. Less money was available for health. The government was not able to finance the health system via general taxation. The Bamako Initiative reform (1988) also instituted the introduction of user fees in government health facilities, the joint management of the resources generated by health staff and the community, and the decentralization of the health sector. The rationale behind full cost recovery was that, there would be an increase in resources to the health care facilities which would allow them to expand and upgrade their services, improve access to health care, improve patient?s care, and better efficiency due to the increased revenue from charges. Furthermore, there was the presumption that, cost recovery would help reduce unnecessary visits by patients who will abuse the system because it was free.

The evidence gathered thus far suggests that, none of the above assumptions materialised.. Since its introduction, cash-and carry appeared to have carried away health services from the people. The cash-and carry system could best be described as ?stinking and dehumanizing? because, patients who did not have the ability to pay for medical services were turned away from hospitals only to die at home. The disabled, poor and accident victims were being asked to pay on the spot before getting medical attention. This system called cash-and-carry was hoisted on the Ghanaian populace by the IMF and the World Bank with the connivance of our government. It was a system which had no human face. There is empirical evidence that shows that, with the introduction of user fees there was a decrease in service utilization especially among the poor who were domiciled in the rural areas. There isn?t any strong evidence that, significant amount of money were generated by the introduction of user fees which helped in improving health facilities.

To make matters worse, cost recovery was introduced at a time when many people had been laid off from the public sector and income levels were extremely low. Many poor people were turned away from health centres for lack of funds. Unfortunately, the poor were simply priced out of hospital care and a two-tier health care system came into operation with better facilities for those who could afford to pay. Once again, women and children bore the brunt of such harsh policies. The introduction of user fees further impoverished the majority of Ghanaians and it devastated their ability to sustain a livelihood for a long time. Some people especially the poor living below the poverty line had to borrow money, took out loans, sold their animals or furniture, dissolved their little savings, cut down on buying food and even stopped sending their children to school in order to pay for health care. The process of borrowing money from the extended family or neighbourhood delayed treatment and in many cases, caused deterioration of the illness or even death. In other cases, people did not seek medical treatment because they could not afford it which often increased their morbidity and mortality.

As a person who is of the structuralism mould and firmly believes that, the government is at liberty to intervene when there is a market failure, it was welcomed news when in 2004, the government rekindled the need for social equity to be a key part of health-care policy. If Ghana is to attain the Millennium Development Goals ( MDGs) and Middle-Income Status by 2015, the main goals of the Health ministry should be three fold namely: increasing public access to health care, improving the quality and efficiency of health care delivery and lastly, improving and increasing programs of education on curative and preventive health care.

Has the introduction of the NHIS totally eliminated the cash-and-carry system? What are the problems and challenges currently engulfing the NHIS system? Is the NHIS sustainable over a longer period of time? Will poorer people eventually be priced out of the NHIS system over the longer period? What measures do we need to counter NHIS fraud and are the rural poor who are at least an hour away from a health centre enjoying the fruits of the NHIS? Part 2 of my article will attempt to answer all these questions coupled with recommendations and the best way forward.