10-16 November 2017 #883

A national health insurance scheme is not as easy as it looks

Expensive medical care is driving Nepalis into poverty, and it is doubtful if a new insurance plan will make it more affordable
Sonia Awale

Photos: Sonia Awale

· 16-year-old Deepa Rai needed a stem cell transplant to treat her lymphoma. But her retired Army father of five daughters and a son could not afford the treatment. He borrowed money and sold the family ancestral land in Sunsari, but Kalpana died earlier this year at age 22. The family is Rs 700,000 in debt.

· Hira Lal Shakya spent all his savings for a kidney transplant in India ten years ago. But his kidneys failed again and he sold his house, handicraft shop and motorcycle to pay for a new operation. Although the 52-year-old has recovered his livelihood has not.

· A father walked with his 14-year-old daughter Binu Bhattarai for several days from their remote village to Bayalpata Hospital in Accham to treat her intra-abdominal abscess. She was referred to a hospital in Nepalgunj, and her father took Rs100,000 in loans from relatives. But he ran out of money and had to terminate the treatment. Binu has recovered now, but her father is deeply in debt.

· Sarita Maharjan’s mother suffered a heart attack followed by kidney failure, then her father was diagnosed with liver failure. Sarita donated a part of her liver to her father, but her mother’s biweekly dialysis has bankrupted the family. The family sold part of its ancestral property in Kathmandu to afford the treatments. Sarita is now working overtime so her parents can afford their hospital bills.

· Ganesh of Gorkha brought his father home after nine days in Patan Hospital with suspected bowel obstruction. A gastro-intestinal endoscopy was abandoned and he still needs surgery. A simple emergency admission has already cost him Rs67,000 even before he starts treatment.

As Nepal’s disease burden shifts from preventable infections to non-communicable diseases (NCDs) like heart and lung ailments, cancers, kidney and liver failures, treatment is bankrupting families and making them heavily indebted.

New world-class hospitals have opened in the cities, but these are largely unaffordable to a majority of patients. To make matters worse, rural government hospitals lack essential staff and equipment to deal with a growing epidemic of cardiovascular diseases, diabetes and respiratory illnesses. Recent studies show that NCDs impact the poor more, as they did not have sufficient nutrition and care at birth and as they grew up.

“The poor are affected more, not less, by chronic diseases if you also consider their ability to pay,” explains cardiologist Bhagwan Koirala. “Even better off families have been known to fall below the poverty line if a member is injured or has chronic illness.”

With more than half of total healthcare spending in Nepal paid directly by patients, medical costs are a major component of a family’s expenses. Prolonged treatment in the city, the rent and travel cost, and private hospital bills can take money away from higher education and force family members to migrate for work abroad.

Says Mark Arnoldy of Possible, which manages government hospitals in Achham and Dolakha: “We need to find ways to pay for healthcare, and try to develop a model that doesn’t drive the poorest patients deeper into poverty.”

Last month, Parliament passed the National Health Insurance Act under which a family of five is entitled to Rs50,000 per year for medical attention after paying a premium of Rs2,500 per year. The act was pushed hard by Health Minister Gagan Thapa before he stepped down, and will at first be implemented in 36 districts.

The Act makes health insurance mandatory, and there will be a budget for a health safety net. However, most medical experts Nepali Times spoke to said that although the law is a positive first step, it is insufficient to address the healthcare needs of Nepalis.

“At first glance it looks more like an election sweetener: it is a token gesture that does not foresee the confusion of whether the Rs50,000 will go to underfunded government hospitals or expensive private ones,” says Kumud Dhital, an Australia-based heart transplant surgeon who helps medical charities in Nepal. “Health services have to be completely free at the point of need. ”

Insurance in rural Nepal also has to factor in the need for followup care. Experts have suggested it may be much more effective for the government to raise funding for rural hospitals so they have the staff and equipment to take care of 90% of cases for free.

Mingma Norbu Sherpa, who till recently served at the district hospital in Salleri in Solu Khumbu, says insurance payments for healthcare will be a bit like reimbursement for earthquake damage: insufficient.

“It will be cheaper for the government to invest in free healthcare in its district hospitals than to cover insurance costs,” says Sherpa. “Patients can also get free healthcare at home while an insurance scheme will drive them to Kathmandu and benefit private hospitals. National health insurance looks like an idea hatched by insurance companies and bankers: healthcare providers were not consulted.”

Possible’s public-private partnership, which provides free rural health care through the government system, is a model that may end up being cheaper than national health insurance. Its electronic health record system, where caregivers have patient’s data on tablets for home treatment and followup, may be more suited to Nepal’s terrain and socio-economic condition. Every expense is recorded in Possible's digital system, leaving no room for malpractice and allowing seamless reimbursement for different models of healthcare. Even if the government goes for national insurance coverage, such connectivity-driven data would be useful.

Govinda KC, the crusading physician who has been on multiple high-profile hunger strikes to demand affordable health care for all Nepalis, and this week gave another ultimatum to the government, also has his doubts about the new scheme. “It remains to be seen if the health insurance will benefit Nepalis or leave some gaps for people to manipulate it,” he told Nepali Times.

As the country gears up for upcoming parliamentary and provincial elections, there is a significant risk of a lack of ownership and confusion between different levels of government in the health sector over their roles and responsibilities in the insurance system.

“If we have the right kind of devolution of authority and resources, local government units will be proactive and accountable, and thereby more effective in prevention, treatment and rehabilitation,” says Bhagwan Koirala. “National health insurance is a start. There will be challenges but we can only move ahead.”

Names of some of the patients have been changed.

Health for all?

The new national health insurance scheme is probably the most talked about topic at the moment, second only to the upcoming parliamentary and federal elections. Since Parliament passed the Act last month, there has been excitement and confusion in equal measure.

As per the Act, all the citizens must enrol under which a family of five will be entitled to Rs50,000 for medical attention per year. There is a premium of Rs500 per person with a total of Rs2,500 in a year. Every extra family member is charged Rs425 per year, who will then be able to claim another Rs10,000. The insurance won’t cover transportation or lodging costs.

However, there is subsidy on the premium for the poor, disabled and elderly, says Gunaraj Lohani of the Social Health Security Development Committee. A family identified as impoverished, poor and marginalised will get 100%, 75% and 50% discounts respectively.

The government will also cover some of the cost for impoverished patients requiring treatment for heart or kidney diseases cancer, Alzheimer’s, Parkinson’s, Sickle cell anaemia, head and spinal injury. The scheme is known as Bipanna Nagarik Kosh, and patients need an official letter attesting to their weak economic status.

The new policy has also introduced a payer-provider split, and the insurer will manage reimbursement both to private and public facilities. Unlike in the past, the head of the Insurance Board will be nominated by the cabinet and will be independent from the Ministry of Health.

In the article he co-wrote with Amit Aryal and Duncan Maru published in the journal Health Affairs last week, former health minister Gagan Thapa who is the architect of the scheme says: ‘Nepal will have to innovate on dlivery of longitudinal care across the lifetimes of citizens in both homes and communities … leveraging our rich history of community-based, preventive care delivery.’

Lessons from the NHS

Bikash Gauchan

Despite providing universal health care and treating all patients equally Britain’s National Health Service (NHS) is much ridiculed within the UK for delays and sloppy treatment. However, as one of the oldest and largest publicly-funded health care systems in the world, it can be example for Nepal as we start implementing our own national health insurance scheme.

Besides free medical care for all its citizens, the NHS provides emergency services and treatment of infectious diseases to visitors free of cost. On a visit last month to attend the national conference of the RCGP (Royal College of General Practitioners) in Liverpool, doctors from various parts of the world got to learn about Britain’s experience with a national health scheme.

As expected, there was a lot of concern about how Brexit would affect the NHS in terms of funding, human resources, medical legislation and research. It was time of stock-taking as the British medical establishment lauded the egalitarian nature of the NHS, while the usual concerns were raised about understaffing, resource constraints, long waiting time for patients, and a complicated referral system.

For the Nepali diaspora in Britain, the NHS is an invaluable service they say they wish they had back home. Kamal Kumar Rai was a resident in Dharan and is now stationed at the British Army base in Oxford, and he is most impressed with the computerisation of patient records.

“One of the best things about the NHS is its electronic record keeping mechanism which maintains health details of each citizen electronically,” he says, “it stores the medical history of each person visiting the clinic and shares with specialists if necessary.”

As a GP at the Bayalpata Hospital in Achham, I have seen how electronic record-keeping can directly help patients, and can also ensure insurance coverage for treatment and followup care in rural Nepal. Like the NHS, this can also level the playing field and provide equality in clinical care.

Rural Nepal faces the challenge of retaining qualified health care workers in district hospitals. Building a robust clinical team of doctors, nurses, mid–wives, community medical assistants and health assistants (HAs) is necessary address the shortfall in health workers.

The UK has new challenges in medical care which the NHS is trying to address. Catriona Williams, a nurse at the Earlston and Seabank Medical Centre listed them at the Liverpool meeting: “Unemployment, alcohol, an ageing population and financial instability are all contributing to an increase in mental illnesses. The NHS has to take these into account,” she said.

Nepal’s health policy makers can learn from NHS about its founding principles like publicly-funded patient-centred high quality care free at the point of delivery and the General Practitioner (GP) based health care system. The fact that each and every UK citizen has access to health care as a fundamental human right is something to learn from.

Nepal’s challenges are access to health care in far-flung mountainous terrain. There has to be comprehensive community health care integrated with a hospital at every local level. Ensuring the availability of essential health services led by a GP round-the-clock at local hospitals is key to improving medical care in Nepal.

Bikash Gauchan is the Director of Medical Education at Possible, Nyaya Health. bikash@possiblehealth.org

Read also:

Policies for the people, Marty Logan

Taking wealth out of health, Buddha Basnyat

Do hospitals have to be so expensive?, Elipha Pradhananga

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