Health Insurance Scheme faces teething troubles

Kathmandu, Apr. 27: Even after a decade since the micro-health insurance facility was launched in Nepal with the aim to establish universal access for citizens to quality health services, the programme is facing multi-pronged challenges including the management of funds, shortage of human resources, and inability to review the increasing claims submitted by the service providers. 

The programme was launched on a trial a decade ago and was formally implemented after two years following the enactment of the Health Insurance Act, 2017. 

Due to the acute shortage of funds, payment liability has piled up at the Health Insurance Board (HIB). It has not been able to reimburse the amount claimed by the service providers (hospitals and health centres) since the beginning of the current Fiscal Year 2024/25. 

The HIB is clearing the dues from the last FY 2023/24 this year. It has about Rs. 17.5 billion outstanding. "Estimating the additional claims in the remaining period of the current fiscal year, the total amount remaining for payment by the end of this fiscal year is expected to be Rs. 24 billion. There is a challenge in developing the capacity to make timely payments," the HIB said in a white paper about its status published a month ago. 

Meanwhile, the amount of claims submitted to the board goes as up as 40,000 a day while the team to review those claims is struggling with limited human resources and technology. 

"The HIB has a team of about 25 medical experts including doctors, nurses and lab technicians to review the claims filed by 485 health institutions across the country. Without additional human resources, this cannot be resolved," said Bikesh Malla, Information Officer of the Board. 

With the current setup, the HIB can review maximum 7,000 cases a day. As a result, the claim verification of the last FY 2023/24 is still pending. The White Paper mentions that the number of claims received by the board and not reviewed is about 9 million by the end of February. The paper also maintains that due to insufficient skilled manpower in claim review and the inherently weak method and process adopted, timely verification of claims has not been possible. 

It has left the Board, service providers, and the insured all disadvantaged. 

Deficit budget, workforce 

The HIB is struggling with the limited sources of income. The fund earns about Rs. 3 billion to Rs. 3.5 billion from the premium charges and receives approximately Rs. 7.5 billion from the budget in a year. For the last three fiscal years, the government has disbursed the same amount of money to the Board. 

According to Malla, the HIB has approved a budget of Rs. 26.59 billion for this year but it is likely to receive one third of that amount. Through the Ministry of Health and Population (MoHP), it has asked for the funds of Rs. 17.5 billion from the Ministry of Finance (MoF). 

But since the country is also struggling with fund management, the MoF had pledged to provide additional Rs. 3 billion on top of the Rs. 7.5 billion announced through the annual budget. If the sum of the premium is also added to this fund, total size of the fund at the HIB reaches Rs. 14 billion. Even then, there will be a shortfall of Rs. 10 billion. 

Meanwhile, the Board has been facing growing operation cost issue including Rs. 23.4 million in house rent and millions of rupees for employees' salaries. 

"The MoHP has directed the Board to reduce the number of consultants, use government buildings instead of renting out space for offices and maintain full transparency," Spokesperson of the MoHP, Dr. Prakash Budhathoki, said to The Rising Nepal. 

According to him, to overcome the challenges posed by the shortage of workforce, the Ministry has given a positive nod to hire 25 experts to review the pending claims. 

Likewise, inability to make the operations fully automated has its toll on the board, service providers and service seekers. 

Due to the inability to use technology that can automatically reject treatments outside the standards set by the Board and provide information on false claims, there is a risk of some service providers entering false claims and even receiving payments, said the Board. 

To address this malady, the HIB has accorded priority to implementation of information technology. New bylaws are formulated and submitted to the Cabinet with a provision to audit the prescriptions of the doctors to discourage the false claims, informed Dr. Budhathoki. 

Hassles to patients 

Hospitals discriminate the patients that come to obtain the health facility under the insurance programme. Service seekers have complained that they have to wait for a long time to obtain the services and have to face hassles at the hospitals. 

The White Paper of the HIB has accepted the fact that there have been widespread complaints that the health service offered by service providers has not been effective. "Problems such as having to receive service only at the designated first service point, unavailability of doctors at the first service point, not being able to get tests done on time, and unavailability of medicines are recurring," read the document. 

Patients reaching Bir Hopspital, Tribhuvan University Teaching Hospital, Chitwan Medical College and other institutions have to spend more time to get their health checked or receive medicine due to additional bureaucratic hassles. 

Malla of the Board said that due to limited capacity of the hospital, small number of equipment and shortage of human resources have been the causes behind such challenges that are causing dissatisfaction on the part of patients. 

As a result, the programme has been witnessing a high dropout rate. In the current FY 2024/25, the dropout rate stands at 54 per cent. Although it was lower than 64 per cent two years ago, this is significant and needs a serious attention, experts say. 

A Health Ministry official said that the Board has failed to identify the reasons behind this high dropout rate and address it in time. 

Likewise, the Board has not been able to train the service provider health institutions with which it has agreements and make them proficient in providing services. The capacity to monitor and regulate the services provided by service providers has not been developed. The Board has faced difficulties in controlling quality due to the inability to pay service providers on time, according to the White Paper.

The Board also doesn't have monitoring and evaluation guidelines while checklists and standards need to be updated. It said that while the practice of joint monitoring has not taken place so far, multiple suggestions and conclusions received from monitoring have also not been implemented. 

The NIB, in collaboration with the MoHP, plans to bring the first service points into operation in all local levels of the country, enhance their capacity and streamline the referral system. 

Strategy to manage funds

The MoHP and NIB have begun work on addressing the challenges in the fund management. Health Minister Pradip Paudel has been stressing on strengthening the Board and expanding the programme so that it could cover every citizen of the country. 

He even went further to increase the health coverage of up to Rs. 500,000 from the current purse of Rs. 100,000 per family. Such amount for senior citizens and chronically ill people is Rs. 200,000. A family can obtain the facility with premium of Rs. 3,500 while senior citizens above 70 years of age need not pay any premium. 

Minister Paudel has already decided to activate the Health Insurance Fund and deposit 1 per cent of the total income of the federal hospital into it. The Finance Ministry has already given a positive nod to his Minister-level decision.

The Health Ministry is of the view that more reforms would be made as per the suggestions of the Task Force on Health Insurance Reform.