Health Insurance

Dr Radhika Thapaliya (Executive Director)

Health Insurance Board (HIB)
Kathmandu, Nepal

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 Presentation Outline
• Background
• Objectives
• Policy tools of Health insurance
• Milestones
• Structure of HIB
• Feature of Health insurance
• Benefit package
• Issues/Challenge
• Way forward

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 3

Background
• The Global population incurring catastrophic health spending increased by 3.6% a year
between 2000 and 2015.
• In most of the low and middle income countries, out of pocket (OOP) payment is the main
modality to pay for health care service utilization. OOP is the main contributor of catastrophic
expenditure to health.
• There are many stories of people having difficulty in getting health care services due to financial
reasons.
• So, every year more than 150 million people suffer financial hardship because they have to pay
for health care.
• UHC (Universal Health Coverage): everyone receives the healthcare service they need without
undergoing financial hardship.
• Thus , concept of Social Health Insurance is started by Government of Nepal for the better health
of everyone in the society and to achieve UHC by 2030.
Source:
https://www.who.int/healthinfo/universal_health_coverage/report/fp_gmr_2019.pdf?ua=1

Mills A. Health care systems in low-and middle-income countries. New Engl J Med. (2014) 370:552–7. doi: 10.1056/NEJMra1110897

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Objectives of health Insurance
Ensures access to health service
▪ Ensures quality health service
▪ Protects from financial hardship and reduce out-of-pocket
expenses
▪ Capacity and ownership building of Health service provider.
Aim of HIB
• Extends health insurance to all districts by 2022 and to all population
by 2030 in line with SDGs.
• Intends to reduce out of pocket expenditure (currently 55% of total
health expenditure) and improve financial protection among the
population through health insurance.
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 Policy tools for Health Insurance
• Basic health services will be provided free of cost
to the population
Constitution of • Ensuring health insurance policy for citizens and
Nepal 2015 making arrangements for their access to health
care (State Directive)

• Basic health services will be free and specialized

National Health services will be provided through health insurance
• Formal sector will be covered; all population will
Policy 2019 be enrolled in health insurance with subsidy to
poor population

National Health • Ensure universal health coverage by

Insurance Policy increasing access to, and utilization of,
necessary quality health services
2013
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 Policy tools (contd.)
•Health insurance as a financing mechanism for
Country’s Five year health system and a tool to provide quality and
development plan equitable health services.
•Aims to enroll 60% of the population in health
(2019/20-2023/24) insurance and reduce out of pocket to 40% at
the end of the plan.

National Health
• Strengthen institutional arrangement for
Sector Strategy social health protection and roll out health
(2015-2020) insurance throughout the country

Health Insurance • implementing health insurance program to improve

access and utilization of quality health services and
Act and Regulation to achieve Universal Health Coverage (UHC)
2019 • Compulsory enrollment of all citizens

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 MOF allocated PHASE 1: PREPARATORY
Budget
2012 Semi autonomous Social Security
2013
Unit formed outside MOHP
PHASE 2: POLICY, LEGISLATION
MILESTONE Health Insurance Policy approved
Social Health Security by Cabinet
Development 2013
Committee formed

2015
PHASE 3: IMPLEMENTATION
Health Insurance Act
promulgated
Initiate HI in
2016
Expanded in 27 Expanded in 58 districts
Kailali district
districts
2017
2017
2020
Health Insurance
Board formed
7-8 July , 2016 7

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Institutional Mechanism
• Ministry of Health and Population: Policy, Oversight, Stewardship,
Reporting Ministry
• Health Insurance Board: Autonomous body under government of Nepal
which serves as a purchaser and negotiates with service provider
institutions.
• Provision for nine members in the board led by chairperson with Executive
Director having the authoritative role.
• It has central office in Kathmandu, seven province offices in each province
and district offices
• Enrollment officers coordinate with municipalities and supervise
Enrollment Assistants (EAs)-the volunteer enrolling households.

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 ORGANIZATION
HIB
Internal Services and Province and District
Decision - makers
processing (selection) administration

Management Board
~ 44 employees at Federal (9 members) • Internal Audit
Office • Chairman and ED • Employer Service
appointed from • Health insurance
~ 7 employees at Province Services
Office
Nepal Govt • Province offices
• Two ex-officio • Controlling
• District levels:
members from MOF • IT
~ 94 Enrolment Officers Enrolment Officers
and MOHP • Data Management
and 5500 Enrolment and Assistants
• Rest five members • Quality Management
Assistants at local level
nominated from the • Claims Mgmt.
MOHP • Sale
• Finance

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Relation of User, Provider and Facilitators

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10 Dr Radhika
 Government of
Function Nepal

Ministry of Health

Claim Monitoring
Policy committee
Verification
Quality Service

Health
Insurance
Board

Health Care Service

Insuree
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 SALIENT FEATURES

Contributory/Family Based Purchaser and

Provider Split

Cash-less and IT based (IMIS)

(Upper Cap )

Subsidy to Poor
Public and Private Providers and Targeted
Service started from Primary Population
Health Center(PHC)

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Features of Health Insurance Program in Nepal
Financing Contribution of household (Rs. 3,500 per annum)

Subsidy Ultra-poor, senior citizen (above 70 years), people living with HIV, MDR-TB,
Leprosy, complete disability (100%)
Female community health volunteers (50%)

Formal sector Around 10-15% in the country, Formal sector not covered so far (government
plan is to levy contribution amount of 1% from employer+ 1% from employee)

Provision for enrollment Compulsory (but no coercion if not enrolled)

Those seeking foreign employment need to submit proof of enrollment in
health insurance

Provider and Purchaser Both public and private health facilities as provider; but public as first point of
contact, private for emergency and referral services. Purchaser is Health
Insurance Board
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Features of Health Insurance Program in Nepal
Benefit package Up to NRs. 100,000 (1000 USD) for 5 member family

Enrollment Through Enrollment Assistants (volunteer) at community

Information system Insurance Management Information System (IMIS) open source for
membership enrollment, claim and verification
Grievance Handling Through Toll Free Number
Co-payment Not in practice

Contracting Contractual agreement between providers and HIB for providing services
under benefit package at specific rate; rate same for public and private
hospitals

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CONTRIBUTION AND BENEFIT

Contribution Amount Benefit Package

▪NPR 3,500 (35 USD) per
year for a family up to 5
members
▪ Promotive, Preventive and Curative services
▪NPR 700 (7 USD) for ▪Outpatient, inpatient and emergency care
every additional family
member ▪Public and private health facilities
▪ 2% payroll contribution ▪Benefit ceiling NPR 100,000 (1000 USD) per year per family
for formal sector of up to 5 members
▪with an extra NPR 20,000 (200 USD) for each additional
member [up to a total of NPR 200,000 (2000 USD)]
▪100% subsidy for ▪Additional NPR 100,000 (1000 USD) for each elderly
population
families of ultra poor,
HIV, MDR-TB, Leprosy, ▪Additional NPR 100,000 (1000 USD) for patient with eight
severe disability patients chronic diseases
etc
▪ 100% subsidy for elderly
population above 70
years
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 Benefit Package of Health Insurance Program

Outpatient & OPD and Emergency Services with listed

Emergency Service diagnostic tests

Inpatient Care Service Disease Condition Specific Package or Per Day

Basis

Diagnostic Services Services Available at Respective Facilities,

Included in Package
Unit Cost Per Service
152 Lab+72 other Diagnostic tests
Medicines 1131 types of drugs including free essential drugs

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Negative List
• Cosmetic Surgery
• Per year more than Rs. 1000 in vision glass
• Hearing Aid 5000
• White Stick 1000
• Baisakhi 2500
• Dental procedure except examination, filling and tooth
extraction
• Artifical conception and sex change

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Process of registration
Registration time Service activation date • Enrollment in health insurance
Baishak, Jestha, Asar Bhadra 1 by EA.
Shrawan, Bhadra, Asoj Mangsir 1 • EA is selected in every ward by
three member committee
Kartik, Mangsir, Poush Falgun 1
headed by Ward Chairman,
Magh, Falgun, Chaitra Jestha 1
• Insure must take service through
first service point, but in
emergency all listed health
facilities

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 EXPANSION OF COVERAGE (District-wise)

19

58 District Covered

58

Covered Uncovered

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POPULATION COVERAGE (Until August 13, 2020)

Over 3 Million 47.7% 52.3% 0.01%

Insured High Enrollment DIstrict (% of Population)

16%

Kailali 20

Palpa 69

Chitwan 46

Sunsari 31

Not Insured
Jhapa 43
84%

Insured Not Insured 0 10 20 30 40 50 60 70 80

20
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ACTIVE ENROLMENT TREND (Until August 13, 2020)

3026750

1523569

1130575

228113

12623
2015/2016 2016/2017 2017/2018 2018/2019 2019/2020

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MEMBERSHIP STATUS (Until August 13, 2020)

Enrolment status

3026750

2207199

819551

Enrolled Active Inactive

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 Total targeted population enrolled: 5,04,215
500000

450000 434318

400000

350000

300000

250000

200000

150000

100000

50000 29,415 32,138

990 6,284 1,070
0
Utra-Poor Members MDR-TB Members HIV Members Leprosy Members Null Disability FCHV
Members

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 SERVICE COVEAGE

Service Utilization Trend

Service users Vs. Enrollees 900000 847277
3500000
800000
3000000
700000

2500000 600000 558451

500000
2000000

400000
1500000
1145653 (33.4%) 300000
233238
1000000
200000

500000 100000
255 17480
0
0 2015/2016 2016/2017 2017/2018 2018/2019 2019/2020
Enrolled Service users
Series1 255 17480 233238 558451 847277
Series1 3026750 1145653

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EMPANELLED HEALTH FACILITIES

Total Service Provide details ( No. 348)

15%

42% Private hospitals

PHCC
Public hospitals

43%

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FINANCING HEALTH INSRUANCE (NPR)

CHART TITLE
MOF Budget allocation (NPR crore) Budget expenditure

600

519

465
259
250

200

138
50

50

50

50

50
10
0.5

2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20

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 FINANCING HEALTH INSRUANCE (NPR)
8E+09

7E+09

6694434878
6E+09

5E+09

4E+09 4177964950

3E+09

2E+09

1E+09

0
Total Premium Collection Total Reimburshmnet

27
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 TOP 10 DISEASES AND AMOUNT REIMBURSED (in million
NPR)

R07 PAIN IN THROAT AND CHEST 116

K29 GASTRITIS AND DUODENITIS 134
R69 UNKNOWN AND UNSPECIFIED CAUSES OF MORBIDITY 143
K80 CHOLELITHIASIS 179
H52 DISORDERS OF REFRACTION AND ACCOMMODATION 184
J44 OTHER CHRONIC OBSTRUCTIVE PULMONARY DISEASE 268
R10 ABDOMINAL AND PELVIC PAIN 313
E11 NON-INSULIN-DEPENDENT DIABETES MELLITUS 341
I10 ESSENTIAL (PRIMARY) HYPERTENSION 452
ICDNAME 0
0 50 100 150 200 250 300 350 400 450 500

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Causes of Low enrollment at national level
Poor service delivery
• Shortage of HR
• Limited availability of services and drugs
• Geographically inaccessible service sites in hilly and mountain areas

Larger informal economy

• 70% of the economically active population involved in informal sectors
• Formal sector not yet covered
Governance challenges
• HIB do not have a full fledged organization structure
• Provincial HIB offices have limited administrative authority.
• fragmented social security schemes
• Private sectors not much interested as they are not first service point
Inadequate community mobilization
• Poor Motivation of Enrollment Assistants
• Limited coordination between HIB and sub-national governments
People unsure about additional benefits
• Free health service program is available in health posts and primary health
centers
• Health posts which are nearly 4000 are not listed as service site
8/23/2020 • hospitals are often burdened Health
with huge flow
Insurance of patients
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Activities carried out by HIB
• Selection, training and mobilization of Enrollment Assistants
• Insurance Management Information System training to service
providers
• Orientation to local government, service providers and
parliamentarians on health insurance
• Promotion of health insurance scheme through newspaper, TV/FMs
and other communication materials
• Service contract with service providers
• Claim verification and Payment to service providers
• Develop guidelines regarding health insurance
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 Issues
Enrollment Related
• EAs Movement in their working areas is poor
• EAs Turnover
• Low/Poor Service Satisfaction
• Awareness / Information about health insurance
• Unclear understanding about the benefits

Service Delivery Related

• Pharmacy Establishment (Timely and Insufficient)
• Staffing (Insufficient, Frequent Movement)
• Medical Equipment Operation Training (USG, X-ray, ECG & Auto
Analyzer Operation Training)
• Service site is not accessible.
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CHALLENGES

INTERNAL CHALLENGES EXTERNAL CHALLENGES

▪ Full autonomy of HIB ▪ Health system strengthening and quality assurance by
Federal, Provincial and Local governments
▪ Delay in recruitment and capacity development of human
resources ▪ Expectation-delivery gap (Raising expectation of insure Vs
low delivery/ quality of service providers)
▪ Translating Health Insurance Act and Regulation into
action : Delay in approval of By-laws and mandatory ▪ Coverage of Ultra poor : Identified in 26 districts only
enrolment
▪ Motivation of Health workers
▪ Provision of voluntary enrollment giving rise to the
adverse selection problem and low coverage ▪ Fragmented health protection schemes: free health care
services vs. AAMA program vs. Health Insurance
▪ Limited fiscal space compared with the subsidies
provided by the state to different groups( ~US$ 101 ▪ Multiple government health insurance Schemes: SSF vs.
Million per annum is required for providing the subsides HIB vs. EPF
to the poor)
▪ Low budget absorptive capacity (43.2 % in FY 2018/19)
▪ Financial viability of the program: Reimbursement
amount exceeds the premium amount collected
▪ Possibilities of fraud claims, and efficiency and timeliness
of online-claims

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 WAY FORWARD
SHORT TERM
▪ Approval of O&M of HIB and
recruitment of adequate employee
▪ Minimum service standard of service
providers to be fixed
▪ Basic health care package to be
defined clearly
▪ Premium collection through Banking
system
▪ District coverage to be increased in
the speedy way
▪ GPS tracking to be customized
▪ Online application
▪ Guidelines, bylaws, Standard
Operating Procedure (SOP) to be
developed as per regulation and the
Act
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MEDIUM TERM
▪ Stringent regulatory norms to
develop for the effective
implementation of the HIP by
MOHP.
▪ Increase motivation to the
employee of service providers
▪ Proper deployment of the doctors
and employee at service sites
▪ Hospital management to be made
autonomous
▪ Efficient infrastructure of HIB
▪ Initiation for automated claim
management (EMR/HER system)
▪ Integration of all health services
(including Free) into health insurance
program
Health Insurance Dr Radhika
LONG TERM
▪ Entire health services to be brought
in the domain of HI
▪ Embarkation of HIB responsibilities:
from both regulatory and operational
to regulatory only
▪ Separate authority for review of
claims (May be third party
administration-TPA)
▪ Standard Medical Treatment
Protocol (SMTP) to be developed and
the service and price to be fixed as
per the protocol
▪ Full implementation of automated
system EMR(Electronic Medical
Record/EHR)
33
 Thank you

Contact :
www.hib.gov.np
Toll Free no 166001 11 22 4

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