Health microinsurance consumer education

Project Basics

Freedom from Hunger is a not-for-profit organization, founded in 1946 and working in 24 countries in West Africa, Latin America and Asia. Its mission is to bring innovative and sustainable “self-help” solutions to the fight against chronic hunger and poverty. Its core activities focus on working with local partners that include microfinance institutions (MFIs) and non-governmental organizations (NGOs) designing and disseminating integrated financial services and lifeskills training, including microfinance and microinsurance, livelihood development, health protection, nutrition and household food security, and empowerment of women. Freedom from Hunger’s work currently reaches 5.1 million microfinance clients.

Although a diverse set of actors is currently involved in providing health microinsurance (HMI) to low-income people, outreach has been limited, particularly in rural areas. For most low-income people in the developing world, the concept of insurance—to protect against the cost of illness, accident and extended ill health—is new, untested and not well understood. To fill the gap, Freedom from Hunger set out to develop a consumer education module targeted to poor families on how HMI works, the benefits of HMI as part of a strategy to protect family assets from the financial impact of serious illness, and how to access and appropriately use HMI to access quality healthcare services.

In the first phase of the project, Freedom from Hunger designed, developed and field-tested an HMI consumer education programme consisting of short, interactive education sessions called Technical Learning Conversations (TLCs). TLCs are 30-minute group discussions designed to be delivered in small groups and to meet the learning needs of poor women, the vast majority of whom have low levels of literacy. The TLCs use stories, role-plays and visual aids to explore the costs and risks of illness, how health insurance works, what the insurance covers, and how to utilize insurance to access covered healthcare services. An adaptation guide to support the implementation and delivery of the TLCs in other countries and with other health insurance products and schemes was also developed. A research plan to evaluate the impact of the module on a range of changes in consumer health insurance knowledge and behaviors—e.g. enrolment and use of services when needed—was also developed with input from Innovations for Poverty Action (IPA), the research organization that then conducted the research studies.

During Phase 2 of the project, Freedom from Hunger worked with Sinapi Aba Trust (SAT), a Ghanaian MFI, and IPA to complete an evaluation of the effectiveness of the consumer education in a real-world environment. The data-collection and analysis took place over a two-year period in order to assess characteristics of MFI clients who were enrolled and not enrolled in the insurance; changes in insurance knowledge; rate of enrolment or take-up; disenrolment; the ability of consumers to access and use the benefits covered by their policies; and, to look at the relationship between insurance enrolment and use of services, food security and financial shocks.

Project context

A national health insurance scheme (NHIS), administered by the National Health Insurance Authority (NHIA) as well as by local scheme offices, provides a comprehensive set of healthcare services that has been available to the formal and informal sectors in Ghana since 2003. However, coverage is far from universal, especially in rural areas.

Ghana’s NHIS enables individuals in the informal sector to register for health insurance by paying an insurance premium and registration fee (see Table 1) and, after a three-month period, receive a comprehensive set of covered health services for no fee.[1]Pregnant women, children under the age of 18 (of registered parents) and persons age 70 and older are not required to pay the annual premium, but may need to pay a small annual registration fee.

The health services covered by the NHIS are fairly extensive and purport to cover 95 per cent of all health problems reported in Ghanaian healthcare facilities. A prescribed medicines list is also delineated. Expensive, highly specialized care, such as dialysis for chronic renal failure and organ transplants, are not covered by the NHIS. Neither are antiretroviral drugs for the treatment of HIV/AIDS, as these drugs are supplied by a separate government programme.

There is a notable emphasis on female reproductive health in the benefits package. Benefits for maternity care include antenatal care, caesarean sections and postnatal care for up to six months after birth. Treatment for breast and cervical cancer are included in the package, although treatment for other cancers is not.

While the programme has dramatically increased access to healthcare services, there are still a large number of Ghanaians, particularly informal-sector workers and the poorest, who are not registered in the health insurance programme. At the end of 2009, the Ghanaian NHIA, which manages the NHIS, estimated that 62 per cent of the population was registered, with 48 per cent actually having current enrolment.[2]A controversial report published by Oxfam in 2011 suggested that the rate of enrolment was likely to have been much lower and that insurance enrolment rates could be as low as 18 per cent.[3]  During 2010, the NHIA took a closer look at actively enrolled members compared to those who had registered but were inactive as a result of non-payment of the annual premium. They determined that 34 per cent of the population was actively enrolled at the end of 2010.[4]  The NHIA estimates of active membership by region showed considerable variation, ranging from a low of 23 per cent in the Central Region of Ghana to a high of 53 per cent in the Upper West. In the Northern Region, the location of SAT’s programme and where the study was located, active enrolment was estimated to be 31 per cent of the population.

While local NHIS offices can set their own registration fees, which usually range from 2–5 Ghanaian cedis (GHC) (US$ 1.32–$3.30), NHIA sets annual premiums. Because fees (and sometimes premiums) vary by NHIS office, the total cost of registering for a year of insurance also varies, but is typically between 11 and 14 GHC ($5.57–$7.22) for adults in the Northern Region. See Table 1for a list of premiums and fees charged by the NHIS districts serving the project programme participants as of January 2012, as reported to IPA by each district NHIS. Children under 18 are exempt from the premium payment, but usually must pay the registration fee.

Table 1. Insurance premiums and fees reported by NHIS districts serving clients of the Tamale, Bole, Salaga, and Walewale SAT branches

All currency in Ghanaian Cedi (GHC; exchange rate as of August 2012 was 1.94 GHC to $1).

Once a person registers with NHIS and pays applicable fees and the annual premium, there is a three-month waiting period before the insurance can be used to access healthcare services, except for pregnant women who can immediately access prenatal and maternity care. By the end of the three-month waiting period, individuals are supposed to receive a health insurance card from NHIS that covers a five-year period. In some cases, the card arrives late and people are told to obtain a temporary card from NHIS. The insurance remains in effect for one year, after which the individual must re-enrol and pay the annual premium and applicable registration fees. The annual expiration date is printed on the NHIS card and stickers are added to the card at the time of annual re-enrolment to indicate current enrolled status. However,  the onus falls on the client to remember to re-enrol; this poses a particular challenge for illiterate clients who cannot read the expiration date on the card and who may not understand that they need to pay once a year.

After the expiration date, covered individuals have a three-month grace period during which the insurance can be renewed. If an individual fails to re-enrol within that grace period, NHIS policy dictates that the individual must go through another three-month waiting period. At the start of our study, NHIS offices serving the SAT clients in our sample were not enforcing this rule. Rather, they allowed individuals to access care immediately after re-enrolling, even if the policy had expired. If the insurance had been expired for more than one year, clients were required to pay the premium for every year that they had missed in order to use insurance immediately. In 2011, local NHIS officers reported a change in the enforcement of the expiration policy, indicating that if registrants did not pay the annual premium and fees within 90 days of expiration, that they would lose eligibility for services and be required to wait three months to access services once premiums and fees were paid for the year.

When a client’s insurance expires at the end of one year, the client is still considered to be “registered” with NHIS—their information is stored in NHIS databases and if they re-enrol, a new sticker is provided for their membership card that indicates the new expiration date. In order to be considered “enrolled” or “active” and eligible for covered services, the client must be current on the premium payment. If the client fails to pay the annual premium, the client may be termed “unenrolled,” “inactive” or “expired”.

NHIS offices report that re-enrolment is a particular challenge. While registration rates have increased, many of the registered individuals fail to re-enrol each year. For example, in 2010 the Tolon NHIS office, which serves a rural area near the city of Tamale in Northern Ghana,[5]estimated that about one-half of the population in its district is registered and has a current policy, but another 30 per cent has registered but not renewed their insurance, allowing it to expire. This is consistent with findings from Freedom from Hunger’s sample for its baseline study, in which 70 per cent of the respondents report being registered for insurance but only about 32.6 per cent of the total could be either confirmed as currently enrolled (premiums current) from visual inspection of the insurance card, or through extrapolation based on their reported use and ways of paying for health services.

There are a number of potential barriers to registration and enrolment in the health insurance programme. Individuals may not know about the programme, may not understand how insurance works or what is covered, or may not know how to go about registering. Some individuals may also be unable to afford the premium at the time it is due. While an 11–14 GHC payment is not a particularly high amount even in rural Ghana, a large family may find it a challenge to put together the money to cover every adult household member under the age of 70, particularly at a set time each year, as there is no flexible payment option. Individuals may also believe that insurance is not a good value for them because of lack of availability of providers, benefit limitations, or because they do not think they will need health services, or perceive the quality of services available to be low compared to health care paid for out-of-pocket, or on a “cash and carry” basis. Lastly, individuals may have every desire and intention to register, but simply do not get round to doing it.