Health Maintenance Organisations (HMOs) are on the verge of losing about two million insured clients in the formal sector as the Nigeria Health Insurance Authority (NHIA) withdraws the provision of basic minimum services from the functions of private insurers.
The authority has urged all employers not to renew health insurance contracts with HMOs by the year-end in a move marking the early phase of implementing the new NHIA Act approved by President Muhammadu Buhari in May.
The controversial decision which has upset the private health insurance industry and sparked debates on its legality mandates all employers to register, transfer and pay premiums on their employees to the national authority.
Rather, HMOs will now act as third party administrators with powers to provide supplementary and comprehensive services which will not be covered under the basic minimum package.
Muhammed Sambo, NHIA director-general said the authority and established state health insurance schemes will harmonise functions to deliver basic healthcare packages since the law has redefined the functions of HMOs.
“If a company wants a comprehensive provision, NHIA will take the money and whatever is supplementary will be sent to the HMO of choice of that organisation. The act was passed by the national assembly and it must be implemented like that,” Sambo said in Abuja at a media briefing on Tuesday.
“But we know that it will create some disruption. That’s why we have to manage it in a manner that will not create any discomfort in the ecosystem.”
There are currently 60 accredited HMOs both at national, state, and zonal levels insuring over three million. They are concerned about what they describe as unrelated interpretations being introduced into the implementation of the new act without dialogue with relevant stakeholders.
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Leke Osuniyi, chairman of the Health and Managed Care Association of Nigeria (HMCAN), a professional association of leading health insurance operators, told BusinessDay that the law does not authorise the NHIA to sell insurance at state levels when most states have developed their schemes with varying packages and premiums. He also noted that there is no prescription for removing HMOs from the formal sector programme as pushed by the NHIA.
In an official reaction provided to BusinessDay on Wednesday, he stressed that only the State Health Insurance Agencies (HIA) are authorised to establish basic health care packages in the states and they may appoint HMOs to assist them with the administration of their schemes.
Participation is mandatory for residents of the relevant states and payments for subscription are expected to be paid directly to the state HIA by the individual or employer, he said.
“HMOs are empowered to operate private plans and offer their plans to all Nigerians provided that the people also have a BHCP. Payments for private plans are to be made to the HMOs directly and HMOs must pay providers for care that has been rendered to their beneficiaries,” the statement read.
“HMCAN believes that where the Act is clear, there is no room for interpretation. The operational guidelines to be issued by the NHIA and subsequently by the State HIAs must be consistent with the provisions of the NHIA Act and only operationalise areas that are not specifically addressed by the Act.”
Aisha Haruna, Lagos State coordinator for NHIA, speaking during a virtual meeting convened by the Chartered Institute of Personnel Management of Nigeria (CIPMN) last week said that the NHIA operational guidelines are currently being developed so that everyone in both private and public sectors can come on board, taking the minimum package.
Addressing concerns about the security of direct contribution of payments to the NHIA in view of the rife corruption in the public system, she explained that payment of capitation will be paid upfront before the enrollees access care, unlike in the pension scheme.
She also noted that management of funds has not fared well in the hands of private insurance, saying the national body is currently burdened with reconciliation of debts between HMOs and health and care providers.
“In 2019, the NHIA recovered billions of debt for HMOs and we are talking about the minute population being covered. What will happen if we now have up to 30 percent of Nigeria’s population in the hands of HMOs? We are being distracted from our main function and running after debts for HMOs to pay HCPs and the people suffering in this drama are our enrollees,” Haruna said.
Meanwhile, HMCAN has demanded that the NHIA define and separate the functions of the NHIA in relation to the administration of the social schemes for all federal ministries, departments and agencies; supervision of all state social schemes, and the licensing of HMOs and TPAs.
It is also seeking clarification on plans by the NHIA to assume the role of HMOs in paying capitation and fee-for-service for the federal social scheme among a list of other demands.
