“A N40,000 family premium on Lagos Health Insurance Scheme can save you from N250,000 emergency

Nigerians have a legendary apathy towards insurance generally. But government knows that to provide reasonable measure of healthcare to the population it must resort to health insurance and try to get citizens to take it up. The Lagos State Government, recognising the enormous funds required to provide healthcare for a population estimated at over 21 million, last December launched the state’s own health insurance scheme. The responsibility of managing and delivering on this scheme has been placed in the hands of PEJU ADENUSI, a medical doctor with the required passion and drive, as General Manager and Chief Executive officer of Lagos State Health Management Agency (LASHMA).  In this interview with business a.m.’s PHILLIP ISAKPA, ADENUSI speaks about the benefits of the scheme, why it is important for Lagos residents to embrace it and how she and her team are working to ensure that more residents come on board the scheme. Excerpts follow:                                                    PHOTO CREDIT: ISAAC JAYEOLA

Thank you for this opportunity to meet with you for the first time to talk about the health insurance scheme in Lagos State, which was launched in December and from December till date, we believe a lot has gone on within the system to respond to the reasons that gave birth to it. Can you talk us through the state of the scheme as of today?

The Lagos State Health Scheme was birthed through a law enacted in May 2015 to cater for the residents. From this law you have the Lagos State Health Scheme, which is the project itself, the Lagos State Health Management Agency, which is the agency that you are visiting now (at Alausa, Ikeja). The Agency has the mandate to regulate, supervise and coordinate the Lagos State Health Scheme. The objective of the scheme is to provide affordable, quality health care services to the residents of Lagos State. It is a mandatory scheme with focus on physical accessibility, affordability (financial accessibility), quality, equity and solidarity. To stress a bit on solidarity, the concept of insurance generally is something that we are just beginning to imbibe, if I am permitted to say so. If we ask ourselves this question, apart from things that are mandatory either through employment or by law for us to insure, is there anything else we insure on our own?. Okay, I’ve built a house and I want to insure my home, this is not common practice  however group life insurance, car insurance are done because it’s one of the requirements for an organization or the state respectively.

When you now talk about health insurance, you know the first thing that comes to people’s mind is sickness, illness, so are you telling me to pay ahead for sickness? And knowing the socio-cultural background, particularly the religious influence, the first reaction is I reject it, it’s not my portion. But as it is, it’s just one of those evils that we cannot avoid as human beings. Health insurance is about health conditions and not just sickness and even so we must remember that sickness does not write you a letter to say I am coming regardless of who you are. For example malaria does not know that you are rich or poor, malaria would hit at anyone. Pregnancy is not only for the poor or the rich, it cuts across, it’s something that every woman and every family desire, but the pregnant woman is not a sick woman, thus talking about health insurance it covers health conditions and not all about sickness or illnesses.

The other principle behind health insurance is solidarity with regards pooling of funds and resources. We will not all be ill or go through a health condition at the same time, but the idea is to have a means to be able to attend to that health condition when it comes, particularly the area of financing. The other thing we are looking at in health insurance is how do we reduce the financial catastrophe that comes from huge medical bills? We know that for most of the population in Nigeria procuring health is usually done out of pocket at the point of service and that portion forms a larger chunk of health expenditure. So, what  health insurance aims at doing is to reduce that out of pocket expenses, as well as reduce the financial catastrophe, particularly among the vulnerable who live below the privileged line and are more likely tipped into further state of poverty. Pooling funds together, like I tell people is a concept that is practiced among us in our society. We have this spirit of being our brother’s keeper, so if you go into any community and any one has a health condition that requires urgent attention but no financial capacity we rally round to help that person. But there is no guaranty that the person we help today will be able to help you when it is your turn. So the idea of health insurance is having a structured system whereby we all gain from it. Yes, we won’t all be sick at the same time or have one health condition or the other at the same time, but at any point in time when it happens, there is a pool of fund to draw from.

Having said that, for the Lagos State Health Scheme to come up with a health benefit package, we had to look at what are the common ailments or health conditions in our environment. Of course, there are some conditions that cut across such as malaria, common childhood diseases and so on. The benefit package covers mostly services that can be provided at the primary care level. Now, when I use the term ‘at the primary care level’ I am not just referring to public health care centre but also the private health sector facilities that do offer  primary health care services.

In addition some selected secondary care services such as intermediary surgeries are covered in the package.  A woman who goes to give birth and has complications that requires that the baby be removed by surgery (caesarian section (CS)), cannot have that procedure done at a primary care level, in this situation referral is made to the secondary care level. Other surgeries included in the package are herniorrhaphy and appendectomy which is carried out when the appendix gets inflamed. The other aspect that we looked at in our benefit package is the issue of chronic non-communicable diseases examples are the diabetes mellitus and hypertension that would not just come now and disappear but entails continuous medication, change of lifestyle and so on and so forth. The benefit package thus gives value for what you pay.

What is the health insurance package made of?

I have mentioned some conditions contained in the benefit package. However, let me at this point talk about the premium, that is cost of the benefit package, which is N40,000 for a family minimum of 2 and maximum of 6 members per policy per year. So, the family here is mother, father and four children below the age of 18. The family is the unit of enrolment. However, we are aware that some residents of the state live alone so there is room for individual enrolment and that comes at a cost of N8,500 per policy per year. We’re very mindful of the fact that we also have families that are more than six. If you have a family that is more than six and the additional family member is less than 18 years, it would come at the cost of 6,000 per child. However, if the additional family member is over 18 years of age, the individual price of N8, 500 applies. So if you really look at the package provided and conditions covered, which includes non-communicable diseases; hypertension, diabetes mellitus, common ailments like malaria, febrile conditions, the surgeries, ante natal care, delivery, laboratory investigations and medicines related to conditions covered, among others, you will agree that the attached premium of N40,000 or N8,500 as the case may be is relatively reasonable when compared to this amount being the cost of a single health incidence. Even if you were to treat malaria today and calculate the consultation fee, lab investigation and so on, you probably will get close to this amount if not more for just a visit to the clinic.

How do you plan to reach out to the people?

Your visit here is a way of sensitizing your organisation and I believe that based on the kind of activities that you do carry out you can also be a channel to letting people know what the scheme is all about. In reaching out to the people as an agency that has mainly a regulatory function, we needed to engage organisations who are good at marketing and mobilizing people to get on board the scheme. So, we’ve engaged Health Maintenance Organisations (HMOs) which, I am sure, you’re familiar with, HMOs were introduced in the National Health Insurance Scheme (NHIS), and became popular implementing the scheme particularly in the formal sector space.

For the scheme the plan is to reach out to both the formal and informal sectors including the public servants. Being a resident in Lagos state is what qualifies you and like I said, it’s a mandatory scheme.  But as I have mentioned earlier, though it is mandatory, there is the need to inform and educate people, and make them understand and accept the concept. That is the foundation for sustainability because it is when you understand the benefit of something that you buy into it. On wider terms, LASHMA is working with a group we have termed Health Insurance Agents (HIAs) which the HMOs are part of. The HIAs actually go out as our Wellness Ambassadors to do the marketing, sensitizing people and creating awareness. So, right now, the HMOs have been allocated local government areas where they cover; the wellness ambassadors also move around as the foot soldiers to engage the people one on one in all the local governments in the state and their duty is to talk about the scheme and get people enrolled into the scheme.

To augment the activities of the HIAs in reaching out to the people several mass media activities which include airing of jingles on radio and TV stations, talks on TV and Radio, market storms among others are done intermittently. These activities will be continuous until we are able to get the desired penetration in every community,

How do you identify those that are vulnerable?

LASHMA has an evidence-based international tool that was adapted and applied in identifying the poor. This is a continuous exercise and currently ongoing in the twenty local government areas of the state. Previous survey in the state revealed that the population of those living below the poverty line stands at about 68 percent.  Already this tool has been applied in Makoko area of Lagos State and those identified are already accessing health care services in both private and public health facilities.

Going back to the law, an entity called the Health Fund was also established as a basket of funds with various potential sources. The main source of this fund is the premium that people pay in addition to the one percent consolidated revenue, grants from donors (local/international) donations from philanthropist etc. Every state is expected to put down at least one percent of its consolidated revenue and this is really to address the population that cannot afford the premium. We know that no matter how low you make the premium there are people who still can’t afford it, and those are the people who live below the privileged line, the vulnerable. This group of people will be taken care of by the state government using the one percent consolidated revenue also called the equity fund in Lagos state.

Aside funding from government other sources of funding are being explored and this will include grants from donors, Nigerians in the Diaspora among others.

We want to ask what enrolment is like. For potential enrolees, who are asking, who are naïve about it, how does the scheme operate, how do I come to benefit from it, what are the steps?

Yes, I did mention earlier that LASHMA works with health insurance agents. These agents also called the Wellness Ambassadors are the foot soldiers who go round to sensitise and engage the people. They educate potential enrollees about the scheme, once convinced and ready to join the scheme the registration process commences. This is automated and your data is captured for the family or individual. You then receive an sms acknowledging registration and providing you with your policy number and amount to be paid based on the information provided at point of registration. With this policy number, you go to the bank (which is one of the means of payment) and make payment just as you pay utility bills. Once payment is done LASHMA receives an alert on our platform.

At the point of registration you are required to pick your hospital within the LSHS network of providers. An enrollee has the absolute right to select the health care provider of his/her choice. However as I said earlier it must be within LSHS network of providers.

If registration is done before the 25th of the current month and all requirements are met you can access care by the 1st of the subsequent month.  Why we cut-off at a particular time is to allow the HMOs, LASHMA, prepare the data for the providers selected, so when you go to the provider, they already have your record, photo ID and policy number and can identify who you are. The photo ID is to eliminate impersonation and avoid the use of enrollee ID cards by uninsured persons in accessing care.

So it is registration and payment that makes you an active enrollee and gives access to care at your chosen health facility.

However, if you have any complaints about your HMO or hospital you have the right to inform your HMO or LASHMA as the case may be. The complaints will be investigated and necessary action will be taken.

There were issues when health insurance started and that had to do with the premium that was paid and the services expected so, I am happy to hear that beyond the simple illnesses there is provision for some challenging ones. How do you manage that?

Let me say that there’s no health insurance scheme that covers all, and we also have to be careful; and that is why the message we would like to pass across is: Anything that is not covered under the scheme has to be paid for by the individual. The emphasis is on what is covered in the health benefit package as it is more difficult to state all conditions not covered. The plan for now is a single package across board but as we implement and gather data (which is one of the gaps in health insurance), the analysis will guide future review. It will also provide information on what is being offered, what can be expanded, what other conditions affect the majority but not within the current package.  If we have to add such conditions, at what cost will it come to the scheme? These we need to know.

Clients therefore should not expect beyond what is currently covered; this has to be made clear to our clients and the understanding established.

You talked about affordability and I know that being able to meet those other health challenges, which we talked about depends on funding. As you progress with the scheme do you foresee where funding will become available to be able to take on certain illnesses?

As mentioned earlier, the data collated will form the basis for an actuarial study which will be used to determine futuristic cost for health conditions that may be considered in the expansion of health plans and benefit package.

We must also remember that whatever is being offered takes into consideration the benefit to the people. Should the priority be to spend money on health conditions that affects five percent of the population or on something that affect 90% of the population? So probably one would choose to spend money on health conditions that affects 90 percent of the population and that was the principle behind the development of the benefit package for the scheme.

How do you ensure that the mandatory nature of this programme adhered to by people because, as an Insurance people tend to dodge; how do you navigate the challenges of getting people?

Yes, there may be the initial resistance either out of lack of understanding of the concept or the notion of “it cannot happen to me”. We are all familiar with this statement; experience is the best teacher.  When you are suddenly hit with a health condition that costs more than the premium required for the scheme you will have a rethink. A good example is when a pregnant woman requires a cesarean section. I don’t think there’s anywhere this procedure is done less than N100, 000, the minimum that I am aware of is about N250, 000. How many families without health insurance can afford to pay this as out of pocket expense without a strain to their savings?  Can we compare N40, 000 for a bouquet of services to N250, 000 as a one off payment for just one health incidence?  Such a person need not be convinced further. He’s going to rush, and say you know what, I have learnt. I believe that as people benefit from the scheme more people will come on board.

The government is doing its part and everyone is encouraged to embrace the LSHS. There are groups from both informal and formal sector already on board.

When this interview goes out someone would be somewhere reading it and will say, I have not heard of this before and this is a fantastic opportunity, I want to walk out of this door, we need to register? So how?

Like I did say, the Agency has HIAs working within the 20 LGAs in the state. The HMOs have designated registration points in addition to the Wellness Ambassadors that move from one point to the other. Given the teeming population of the state, we recognize that the current number of Wellness Ambassadors is limited however we are recruiting more and it is an ongoing process. Furthermore, the Agency can be contacted directly on xxxxxxxx

Okay, so I want to ask this question regarding the number of HMOs on board at the moment and also if we could know the health care providers who are on board?

The Agency has almost 200 public and private health care providers and nine HMOs on the scheme; but also working with a number of Health Insurance Agents and Marketing Organizations as mentioned earlier.

I would like to ask this question, when you were planning to launch and now you have launched, was there a target that you have in the next one year to five years the number of enrollees that you are expecting?

We hope that in 5 years into implementation about 30 percent of the population should have been covered.

Now that you have a 30 percent target of the population in the next five years, after the five years and you are not been able to cover the 30 percent what would happen, would there be any plan from the state?

We will not wait until five years to discover we have not met our target. For any program, there must be a performance check. As I speak to you almost on a weekly basis, we do reviews. We engage our HIAs and providers to identify good practices, challenges and proffer solutions to improve implementation of the scheme. The performance reviews are also an opportunity to re-strategize and use the information collected to make evidence based decisions. These are all part of our feedback management system.

In addition one of the activities we plan to do is to have what you call an annual enrollee forum which is likened to annual general meeting that you have for stakeholders because they are major stakeholders in this scheme. At this meeting other stakeholders will also be present as this scheme is a Public Private People Partnership, so it is all encompassing.

In insurance, because it’s a pool, of course, sometimes that pool is able to deal with the challenges that arise as you go along but sometimes premium can be short, right? Which means funds can be short if challenges are coming up more frequently than expected, what’s the stop – gap?

The stop gap is to ensure effective benefit administration and closely monitor utilization trends.  The LSHS provider reimbursement methods are Capitation and Fee For Service (Claims). Capitation is a fixed fee for bundled services paid to a provider monthly while the Fee For Service is amount paid for specific services whenever rendered. Claims submitted must go through due diligence to ensure that every requirement for payment is met. This entire process reduces the risk of payment for services not covered by the scheme.

I understand that 75 percent of the premium is picked up by the Lagos State government for the civil servant. Is this correct?

It’s 75 percent for public servants, government staff. Whatever the premium is, 75 percent will be paid.

Lagos is a magnet, it attracts everybody from all over the place even outsiders, not just Nigerians. That provides a lot of challenges for Lagos, given that it’s a small state, as far as this scheme is concerned, recognizing this dynamics, right? How robust is this set up to continue to shoulder this influx from across the world?

It is a fact that Lagos State is a dynamic state where people keep coming in and even when people emigrate, you still find people migrating. I would assume that on a daily basis thousands are trooping into Lagos State, this will increase the population and contribute to expanding those living below the poverty line. The resultant effect is a strain on the health care system and funds required to cover the population below poverty line. However, in all these there is a window of opportunity for further investments in the health care space by private sector such as establishing hospitals, laboratories etc in the bid to meet the need of the teeming population. Also, we believe that as the economic situation improves in other states as well as the establishment of State Health Insurance Schemes, the pressure on Lagos State hopefully will reduce.

If I can enroll as a family, and I have myself, my wife and four children and two of them are under 18 years of age as at the time of my enrollment, and in another six months, I have one of them has become 18 and I enrolled and pay the premium of N40, 000 for a family of six.  What happens to the one that was under 18 and after I have enrolled and now becomes 18?

He still has to finish the policy, the policy is one year, so it’s only at the point of renewal it will change. I like the example you gave. You have a family, two out of the four children are under 18 years of age and the other two are above 18 years of age so you are still going to pay N40, 000 in addition to paying N8, 500 each for the ones that turned 18.

Like someone did ask a question during one of our radio presentations, he said: “N40, 000 but we are only two, why should I pay N40, 000?” And I love the response, you know, this is insurance, a family of three can use the facility even much more than the family of six. So, it has nothing to do with how many you are in the family and that’s why I said minimum of two maximum of six; for being very specific I said that.

If you go to the general hospital and there’s a long queue of patients waiting to be attended to, is there a preference for someone who has a health insurance scheme or it’s general. I would take us back to the private hospitals; if I am coming as a health care insurance patience would they not prefer to attend to someone who is coming with cash?

Whether it is public or private, there is no hospital you walk into that will attend to you without conducting certain procedures that are preconditions to seeing a doctor. Going to a hospital can be likened to a banking hall where you need to queue and wait for your turn unless it is an emergency. Everyone desires to be treated as king or queen. However, we must recognize that at the point of consultation every client wants to maximize the time which to the next in-turn is considered delay or waste of time. My appeal is that enrollees be patient but if the waiting time is exceptionally long then the client service officer is notified.

Any Closing remarks?

I will like to seize this opportunity to encourage everyone to come on board the scheme. In the lighter mood, as we approach the end of the year, one of the best gifts for the new year to a mum, dad, siblings, relatives, friends and neighbours is the LSHS plan.