June 2022 Businessdaily ;As the country gears up to a general election, a key campaign pledge by the leading contenders for the presidency is for Kenya to attain universal health coverage (UHC). Both presidential candidates have stated their intention to achieve this feat by ensuring that every Kenyan is enrolled to the National Health Insurance Fund (NHIF).
The articulation of this policy “WHAT”, without its attendant “HOW” is lacking in its grounding on evidence and the experience of Kenya’s own quest for UHC as well as other countries’ experiences.
A key consideration in selecting the appropriate policy option for UHC is bureaucratic capacity. I use bureaucratic capacity to refer to the ability of government structures and systems to deliver on an intention, given political, technical, and structural capabilities.
Bureaucratic capacity is about whether the government has the wherewithal to do what it says it wants to do. It is the difference between empty political rhetoric and pragmatic, achievable, and impactful policy making.
If the next government is serious about moving the needle on UHC, then my free advice is that the optimal policy choice is to remove user fees in all public county hospitals on the 1st of September 2022.
This is the option that is congruent with Kenya’s bureaucratic capacity. We know that the government has the capacity to implement a user fees removal policy because it has done it before with great success. The most successful health financing reforms in the past decade have been the abolishment of user fees in public dispensaries and health centers, and the free maternity programme.
At the county level, Makueni county’s’ celebrated UHC programme simply removed user fees from public hospitals and found a way to compensate hospitals for revenues lost, and it worked! We don’t hear much about counties that, unlike Makueni, have chosen the policy option to enrol their citizens the NHIF.
A hospital user fee removal policy is a simple policy to implement. You simply have to estimate what resources are required for hospitals to deliver services, allocate a budget to hospitals that covers this requirement, and abolish user fees.
To achieve this, the government will also need to establish a tax-funded fund allocate this to public hospitals as compensation for user fees forgone. For this to work, these funds must be ringfenced, and hospitals must have the financial autonomy to use these funds to provide care for Kenyans.
A policy to abolish user fees in public hospitals obviates political economy challenges, as well as technical and structural capacity constraints.
Health financing reforms in Kenya have strong stakeholder interests, with powerful stakeholders such as the private sector, labour unions, and some donors, often creating headwinds whenever the country intends to make a bold step that might not align with their sectarian interests.
Luckily, user fees removal policies in Kenya in the recent past have not faced much political pushback.
What about the NHIF? It is instructive that over its 56 years of its existence, the NHIF has only been able to achieve close to 20 percent population coverage. The failure of the NHIF to scale population coverage is not for lack of trying.
The structural challenge that the NHIF faces is that 80 percent of Kenyans are in the formal sector, and close to 40 percent are poor. What this means is that the NHIF is unlikely to get informal sector individuals and households, who earn irregular and unpredictable incomes to make monthly premium contributions faithfully and consistently.
While the recently passed amendments to the NHIF act makes it law that NHIF enrolment is de jure mandatory, enrolment will remain de factor voluntary because the government lacks the bureaucratic capacity to enforce the mandatory enrolment of all citizens to the NHIF.
The policy choice to scale population coverage with NHIF using members premium contributions will therefore remain a Sisyphean task.
Implementing a UHC scheme through the NHIF also requires the enhancing of the NHIFs capacity to design and implement the technical requirements of an efficient insurance-based approach (e.g. developing and managing actuarily informed premiums, designing and implementing provider payment rates and mechanisms, managing contracts with healthcare providers, and competently implementing controls to manage the relationships between enrolees, the NHIF, and providers).
Radical NHIF reforms are constrained by political push back by powerful actors that have captured the institution.
To achieve UHC through the NHIF therefore, the government will need to develop the conceptual cajones to overcome the political push back from powerful interest groups, allocate tax funding to the NHIF to cover 80 percent of the population and strengthen its capacity to manage the complex technical requirements associated with health insurance.
In the absence of these proverbial cajones, Kenya’s UHC policy jackpot is therefore user fee removal in public hospitals.