Increased publicity around Universal Health Care (UHC) has raised awareness and visibility of the National Health Insurance Fund (NHIF) product.
But is that incentive enough for people to enroll to the scheme? Taking cue from similarly aligned strategies elsewhere, notably studies on the impact of premium costing, deadlines and penalties on enrollment, we could borrow a leaf or two.
Findings on reasons for enrollment show that the scope of diseases covered, compensation levels, pricing of premiums and claims settlement timelines to providers are the biggest influencers. Based on these and other parameters, the NHIF can judge its product.
Amongst jua kali and low income contributors with erratic wages, the consequence of late premium contributions and penalties creates an inescapable mix that prevents their re-entry to safety coverage.
Penalties, while aimed at guaranteeing the funding cycle, actually have negative repercussions amongst such groups. For instance, how long does it take to get a defaulted client across each premium band back to good standing? Secondly is there a penalty fee such a defaulter is comfortable to rejoin the scheme?
Such statistics are unavailable, but the NHIF just like banks and mobile lenders, ought to have data on these to guide on its strategies.
A debate arises on which approach between encouraging saving for insurance or facilitating borrowing for payment of premiums works best. The fact though is that for Kenya’s lowest income earners, saving seems to be harder than borrowing.
To fix this, suggestions gleaned from interventions elsewhere show two approaches can be taken. The first one is to entice this bottom of the pyramid groups to see the value of enrolling. Here easing the process has been noted to work. Secondly supporting them to avoid lagging behind on premium payments and the inevitable punitive penalties meted out also works. These two combined make a big difference in retention rates.
Amongst certain income groups, saving for health is an almost impossible task. Yet often their health expenditure is out of pocket at “private facilities” usually at higher costs and maybe paid for from borrowed funds.
If our ultimate aim is to get net-creditor groups insurance, is facilitating low interest rated loans for premium payments worse to punitive default fees? The UHC agenda gives a win-win opportunity for our financial sector to strategise on how to chip in while tapping in to the 48 million Kenyans and over Sh30 billion fund for this band.
They can design products to lend for NHIF premium for those at risk of penalties and defaults.