Comparing health Insurance laws in Nigeria and South Africa

South Africa’s National Assembly recently approved a groundbreaking law that paves the way for the introduction of universal health insurance. The National Health Insurance Bill, passed on June 13, 2023 has generated both praise and criticism from various stakeholders, including businesses, opposition political parties, health-care professionals, and activists. In this article, we will compare this landmark legislation with Nigeria’s National Health Insurance Authority Act of 2022, highlighting the similarities and differences between the two approaches.

South Africa’s health-care system currently operates on a two-tiered model that is highly unequal. While the state-funded public sector serves the majority of the population, it suffers from chronic underfunding. On the other hand, the private sector relies on individual contributions to medical aid schemes or health insurance, making it affordable to only a few.

The National Health Insurance Bill aims to establish universal health coverage by purchasing services from health professionals through a National Health Insurance fund, which will be delivered at both private and public facilities. The goal is to ensure equitable access to quality health care for all citizens, regardless of their race or income. By eliminating the requirement for direct contributions to medical health schemes, South Africans will have access to quality health care without financial constraints, according to Joe Phaahla, South Africa’s Health Minister.

Phaahla acknowledged the government’s previous efforts to provide free health services for pregnant women and children under 6 years, as well as free services at primary health-care facilities. However, he recognized that the country still struggles with race-based disparities in health-care access and quality. The National Education, Health and Allied Workers Union, a supporter of the Bill, emphasized that access to quality health care is a fundamental right and should not be delayed by the profit-driven interests of private sector stakeholders.

In terms of health spending, South Africa currently allocates 8.5% of its gross domestic product (GDP) to health care, higher than many comparable nations. However, half of this expenditure benefits only the 16% of the population fortunate enough to have medical insurance. This leaves the public health-care system overwhelmed, with long queues, critical staff shortages, and aging infrastructure, struggling to provide basic health care for the remaining 84% of the population, as stated by Matthew Parks, Parliamentary Coordinator of the Congress of South African Trade Unions.

In Nigeria, a similar initiative was undertaken with the enactment of the National Health Insurance Authority Act 2022. The Nigerian law seeks to establish a National Health Insurance Scheme that provides access to affordable health care for all citizens.

South Africa’s National Health Insurance Bill and Nigeria’s National Health Insurance Authority Act 2022 share a common goal of providing access to quality health care for all citizens. Both laws seek to address the existing disparities in health-care access and ensure equitable coverage. However, their approaches and specific provisions differ in various aspects.

First, South Africa’s National Health Insurance Bill proposes a National Health Insurance fund that will purchase services from health professionals, both in private and public facilities. This fund will be financed through general tax revenues, payroll taxes, and mandatory contributions from individuals and employers. The details of financing and the benefits package are yet to be determined, raising concerns about the potential tax increases required.

In contrast, Nigeria’s National Health Insurance Authority Act 2022 establishes a National Health Insurance Authority (NHIA), which operates as a social health insurance program. The NHIA is funded through contributions from employees, employers, and the government. The Act mandates that employers with at least five employees and a minimum annual turnover must provide health insurance coverage for their employees.

The South African Bill aims to ensure universal access to quality health care for all races and income groups. It seeks to eliminate the requirement for direct contributions to medical health schemes and provide coverage for legal residents based on their healthcare needs rather than socioeconomic status.

Nigeria’s National Health Insurance Authority Act 2022 focuses on providing health insurance coverage for employees in the formal sector and vulnerable groups such as children under five, pregnant women, elderly citizens, and persons with disabilities. It emphasizes the need to expand coverage to informal sector workers and citizens in rural areas over time with complementary subnational health insurance schemes.

The South African Bill aims to utilize both private and public facilities to deliver health services. Health professionals will be contracted by the National Health Insurance fund to provide care. The Bill establishes the South African Office of Health Standards Compliance to ensure quality standards are met by all providers.

In Nigeria, the National Health Insurance Authority Act 2022 allows for the participation of private health-care providers in delivering services to beneficiaries. Accredited private facilities can become NHIA-accredited healthcare providers and receive reimbursement for services rendered.

However, both countries face challenges in implementing their respective health insurance laws. In South Africa, concerns have been raised about the cost implications, potential tax increases, and the management of state facilities that currently struggle to meet quality standards.

In Nigeria, the implementation of the National Health Insurance Authority Act 2022 faces challenges such as limited coverage for citizens in the informal sector and rural areas, as well as the need to ensure that private health-care providers meet quality standards and adhere to the NHIA reimbursement process.

As South Africa and Nigeria take steps towards universal health coverage, their experiences will offer valuable insights into the challenges and opportunities associated with transforming health-care systems. Time will tell how these landmark laws shape the future of health care in both countries and serve as potential models for other nations striving for equitable and accessible health services for all their citizens.

Okeke writes from the Centre for Social Justice (CSJ) Nigeria