WorldStage Newsonline (Abuja)– As the Federal Ministry of Health and Social Welfare set to convene a high-level national policy dialogue on September 1-4, 2025 to deliberate on innovative and sustainable approaches to healthcare financing that will guarantee equitable access to quality health services for all Nigerians, many of the citizens are already expressing divided views on how the forum will be different from those held in the past that hardly achieve desired goals.
Health care financing system is a process by which revenues are collected from primary and secondary sources, e.g., out-of-pocket payments (OOPs), indirect and direct taxes, donor funding, co-payment, voluntary prepayments, mandatory prepayment, which are accumulated in fund pools so as to share risk across large population groups and using the revenues to purchase goods and services from public and private providers for identified needs of the population, e.g., fee for service, capitation, budgeting and salaries.
WorldStage Newsonline recalls that in the 2001 Abuja Declaration, African leaders pledged to allocate at least 15 per cent of national budgets to health, but Nigeria currently allocates less than 5 per cent, with public health spending estimated at only 0.5 per cent of GDP and leaving her to continue to underperform in health financing.
Reports show that this shortfall has left households to shoulder the bulk of healthcare costs. Data from the World Bank shows that out-of-pocket expenditure accounts for approximately 76 per cent of total health spending in Nigeria – one of the highest figures globally. Consequently, millions of Nigerians face catastrophic health expenditures, with many families driven further into poverty by medical bills.
It’s in order to address these concerns that Nigeria enacted the National Health Insurance Authority (NHIA) Act in 2022, making health insurance mandatory for all citizens and legal residents. The law empowers the NHIA to regulate providers and expand coverage to previously excluded populations.
Experts believe the upcoming dialogue will be crucial in exploring how the NHIA Act can be fully implemented and how the Basic Health Care Provision Fund (BHCPF) can be scaled up, arguing that innovative financing mechanisms, such as public-private partnerships, earmarked “sin taxes,” and donor alignment, could help bridge Nigeria’s health financing gap.
Highlighting the importance of the event, Mrs. Maimuna Abdullahi, a Health Economist with the African Health Budget Network (AHBN), stressed that achieving UHC requires reducing reliance on out-of-pocket spending. “The dialogue is an opportunity to rethink financing models, strengthen accountability, and ensure that health insurance truly works for the poor,” she said.
Giving further reason for doubting the event culminating in any significant effect, Dr. Pious Alegbe, a health practitioner and public analyst, argued that the foundation for the success of whatever remedial resolutions that emerge from the convention is likely to be numbed by the lack of presidential accent to the already passed National Health Bill, without which the bill will remain inoperative.
The National Health Bill represents the first attempt to provide legislative clarification and funding sources to support Public Health Centres (PHC). The Bill proposes that National Primary Health Care Development Agency has responsibility for disbursing the funds for essential drugs for PHC, facility maintenance and human resource development through State Primary Health Care Boards for distribution to Local Government Health Authorities.
The Bill also provides that for any state or local government to qualify for federal government block grant, the state and Local Government Area (LGA) must contribute not less than10% and 5% respectively of the total cost of the project. It also significantly increases government financing for PHC and targets universal coverage with at least basic services.
The Bill further proposes that National Primary Health Care Development Agency (NPHCDA) has responsibility for disbursing the funds for essential drugs for PHC, maintain facility and human resource development through State Primary Health Care Boards for distribution to Local Government Health Authorities.
Though Shoretire explained that the dialogue is designed to translate high-level commitments into actionable strategies that will strengthen the country’s health financing architecture, some of those who spoke on the coming event, as Alegbe, said the outcome of it is bound to count for nothing without the validation of the health bill by President Bola Tinubu.
As forerunner to September 1 – 4 policy dialogue, the Federal Ministry of Health had in 2006 enunciated a National Health Financing Policy in 2006 that sought to promote equity and access to quality and affordable health care, and to ensure a high level of efficiency and accountability in the system through developing a fair and sustainable financing system. The overall goal of it was to ensure that adequate and sustainable funds are available and allocated for accessible, affordable, efficient, and equitable health care provision and consumption.
The key thrusts of the National Health Policy in relation to health financing are to expand financial options for health care and strengthen the contribution of the private sector and prepayment based approaches for financing.
It also seeks to engage communities and households in community-based schemes for the financing of primary care services. Public-private partnerships are also presented as strategic approaches for the expansion of health financing options at all operational levels. Specific provisions include increasing government funding to international standards, prioritization of primary health care (PHC) and rural poor in funds allocation and increasing allocative efficiency by redistributing resource allocation between levels of care to ensure adequate allocation to preventive and promotive care.
However, since the government has put in place various policies and plans addressing health care financing, how loser have they got to UHC with issues related to how and from where to raise sufficient funds for health? And how is government addressing financial barriers that exclude many poor from accessing health services and as well providing an equitable and efficient mix of health services?
Therefore, achieving successful health care financing system continues to be a challenge in Nigeria.
In a report by Messrs Uzochukwu Ughasoro and co. in Nigerian Journal of Clinical Practice, they listed that the country’s failures in healthcare financing stem from consistently low government spending, high reliance on out-of-pocket payments by citizens, ineffective implementation and underutilization of the National Health Insurance Scheme (NHIS), widespread corruption, and insufficient private sector investment. These issues result in a system where a significant portion of the population cannot afford necessary care, public health facilities are inadequately funded, and progress toward Universal Health Coverage (UHC) remains stalled.
“Besides, revenue for financing the health sector is collected majorly from pooled and un-pooled sources in the country. The pooled sources are collected from budgetary allocation, direct and indirect taxation as well as donor funding.
“However, the un-pooled sources contribute over 70% of total health expenditure and this can be: out-of-pocket payments in the forms of fees (informal or formal direct payments to healthcare providers at the time of service) about 90% and payments for goods (medical products such as bed-nets, or condoms) and about 10%. Despite these health financing options in Nigeria, the finances are still disproportionately distributed across the health system and with regional inequity in healthcare expenditure,” they stated further.
Although states allocate reasonable budgets to their health sector; there is evidence of erratic and non-release of the allocated budgets. In many states of the federation, the non-release affected both recurrent and capital budgets and this led to significant poor implementation of program activities. At the LGA levels, the financial allocations do not extend beyond the payment of salaries and consequently not much, if anything to pursue health programs, including the issue of monitoring and supervision and logistics support for outreach services.”
Therefore, in the face of achieving Universal Health Coverage, achieving successful health care financing system continues to be a challenge in Nigeria. And to achieve universal coverage using health financing as the strategy, there is a dire need to review the system of financing health and ensure that resources are used more efficiently while at the same time removing financial barriers to access by shifting focus from out-of-pocket payments to other hidden resources. There is also need to give presidential assent to the national health bill and its prompt implementation when signed into law.
