The Roles of Financial Institutions in Improving the Health Sector in Nigeria Article by Oluremi Osibogun.

October 2011 Introduction/Background Investing in a population's health is critical for improving livelihoods and creating sustainable, long-term development.The World Health Organization's definition of health is not merely the absence of disease but the attainment of a state of physical, mental, emotional and social wellbeing. Health expenditure data shows that, although the public-private mix varies significantly by country (and information to accurately quantify this mix is scarce), more than half of total health spending is private out-of pocket in at least 19 countries in Asia and 15 countries in Africa, including many of the worlds most populous nations (China, India, Pakistan, Bangladesh, Nigeria). Private providers and the health markets that they operate in have the potential to both harm and improve the health of the poor. In order to ensure that health markets and private providers contribute to national health and financial protection goals, governments must play an important stewardship role of their whole health systems, including the part that they do not directly operate, by better regulating, managing, and incentivizing the non-state part of the health sector. Investments in health infrastructure require substantial financial sums, and although public health authorities can help publicize needs and exert pressure, key decision makers generally reside in other sectors of government. There are, however, complementary initiatives that lie within the purview of public and private health.These interventions should typically build on existing structures, attempting pragmatically to improve them rather than replace them. Many of these programs have and are currently been implemented with assistance from International agencies such as the World Health Organization, USAID and United Nations. In May 1999, the government created the National Health Insurance Scheme, the scheme encompasses governmentemployees, the organized private sector and the informal sector. Legislative wise, the scheme also covers children under five, permanently disabled persons and prison inmates. In 2004, the administration of Obasanjo further gave more legislative powers to the scheme with positive amendments to the original 1999 legislative act. Under this scheme, the poor still fends for their health care, which is the ultimate responsibility of all tiers of government. The era, which depicts Nigeria mainly in terms of rural villages, is now in the past. A panoramic view of todays demographic landscape reveals a myriad of cities and towns. Even in medium-sized cities, one can find a full array of providers who serve various niches of the health care market, ranging from traditional healers and sellers of drugs in street markets to well-trained surgeons.By 2030, according to the projections of the United Nations Population Division, more people in the developing world will live in urban than rural areas; by 2050, two-thirds of its population is likely to be urban. The supply side of the urban health system is just as diverse as the urban population. The private sector is a far more important presence in cities than in rural areas, and urban health care is expensive and more often out of budget for the common citizen. Credit is an engine of growth that drives private sector development. Financing is an essential input that assists the private sector to expand the range and types of services, enter new markets and improve services. Throughout the developing world, mixed public and private financing characterize health systems. In many countries, private providers including a plethora of different types of formal and informal, for profit and not for profit organizations and individuals are more numerous than their government counterparts are.

In many countries in the developing world, the private health sector is not able to access financing from local financial institutions. In recent past, many banks are inexperienced with the private health sector and believe that it poses unacceptable risk. For their part, many private health care businesses do not command the business skills needed to develop a bankable business plan. With the advent of the National Health Insurance Scheme and subsequent influx of private healthcare providers, banks have been supportive of their business needs as well as corroborate the development programs of the government and international agencies.

References 1. Urban Poverty and Health in Developing Countries Vol. 64 No2 2. The Banking on Health Project USAID

The Roles of Financial Institutions in Improving the Health Sector in Nigeria Article by Oluremi Osibogun. October 2011