Do more research on Health Insurance Bill - Insurance body

The Insurance Regulatory Authority (IRA) has called for an actuarial study to determine the contributory rates for employees, employers and those in the informal sector in the National Health Insurance Scheme Bill, 2019.

An actuarial study involves evaluating risks and maintaining the economic stability of insurance or financial organisations.

The Bill proposes; that civil servants and or formally employed Ugandans shall contribute 4% of their gross pay and the employers top up with 4% to make 8% as monthly contribution. Another one is that 4% shall be deducted from the monthly wage or salary of the employee and the employer will contribute 1% totalling 5%.

Appearing before the Parliament's Committee of Health to present views on the Bill, IRA executive director Alhaj Ibrahim Kaddunabbi Lubega said: "Whereas these are the running proposals in the NHIS Bill, employers and employees need to know why and how the 8% or 5% has been arrived at and that is why we are proposing that an actuarial study which is scientific in nature should be carried out."

He cautioned that: "We should not include the contributory rates in the main law for flexibility. This is to avoid similar challenges we are having today with the compulsory Motor Third Party Insurance premium rates.

The 5% monthly deductions for people informal sector will depend on the wage while the self-employed and informal sector players will pay sh100, 000 annually.

Vulnerable people, who depend on less than a dollar per day, will be exempted. The disabled, old, street children and people above 18 years with no formal or informal employment will also be exempted.

Kaddunabi told a committee chaired by Dr. Michael Bukenya that whereas under section 25 (1) every contributor shall upon payment of the prescribed contribution, be issued with an identification card for purposes of identification and verification, a spouse and the child of the contributor are entitled to benefits under the scheme but there is no provision for issuance of the identification cards to these beneficiaries.

"This may cause some challenges in the process as every person will be required to present their identity card. We recommend that the meaning of the word ‘child' should be better defined to exhaustively address the issue of dependents and the definition of ‘beneficiary' in section 2 to mean a person entitled to health care benefits under the scheme and include a contributor, a spouse and the child of the contributor," he cautioned.

Other proposals IRA presented included reduction of board members of the scheme, use of already established systems such as Uganda Revenue Authority or National Social Security Fund to collect contributions, regulation of the scheme in line with the Insurance Act of 2017, review of the complaints handling mechanism to be established under the Regional Appeals Tribunals among others.

The National Social Security Fund (NSSF) recently proposed an all-inclusive alternative Health Care funded by a 2% assessment on formal wage and 1% minimum wage from the informal sector to create a Health Fund.

"We are recommending that this proposal be funded by a 2% assessment on formal wages: with 1% from the employee and employer 1%. A minimum of 1% of proposed minimum wage from the informal sector," NSSF deputy managing director, Patrick Ayota, said.

This, he said would improve and strengthen the public health delivery system and ensure that more than 80% of Ugandans who live in rural areas will have access to decent and affordable health care.

According to Ayota, the proposed minimum user fee of only 1% of the minimum wages (sh130,000) per month per individual makes the head of the household responsible for the health fee of his/her household.

He said the proposed Health Fund does not take away the private health care insurance. The Fund would not cover wages and salaries, administration and other operating expenses of the health sector. That would remain the responsibility of the central government, he added.