BusinessDay HMO Report: Insights of the Nigerian Health Insurance Industry

BusinessDay presents insights from the Leading HMOs in Nigeria. These HMOs have contributed significantly to policy advocacy, regulatory framework, healthcare delivery and the development of the nation’s health insurance market. The five HMOs are Avon HMO Limited, AIICO Multishield, Healthcare International, Hygeia Nigeria and Total Health Trust (THT). The Report contains interviews with these major players on the issues, challenges, trends, and outlook for the Healthcare and Health Insurance Industry in Nigeria. This publication also contains insightful articles, as well as recommendations for the sector. BusinessDay also plans to publish a larger report covering the entire spectrum of the health market in Nigeria and titled “Health Financing in Nigeria Report: Issues, Trends & Outlook.”

Nigeria’s population is estimated at 186 million and is growing at 3 percent annually, with more than half of population under 30 years of age. The size and composition of Nigeria’s population makes it a vibrant health sector opportunity. Yet, government is incapable of fulfilling its obligations to the sector, thus placing a huge burden on the citizenry. Over the past decade, less than 7 percent of Nigeria’s annual budget has been allocated to healthcare. In 2018, the Federal Government has allocated N340.45 billion, which will account for representing 3.9 percent of the N8.6 trillion expenditure plan for the fiscal year.

In 2017, the amount was N304 billion representing 4.6 percent of the total budget. It is for this reason that the National Health Insurance Scheme was passed into law in May 1999 and the NHIS Act became fully operational in 2005 when the public sector aspect of the regulation was enacted. Despite the NHIS Act, only an estimated 5 to 6 million people out of the total Nigerian accounting for less than 5 percent of the populace are covered by health insurance.

With about 60 Health Maintenance Organisations (HMOs) operating from approximately 600 branches nationwide, the health and managed care market can be described as emerging. Overall, the Industry employs over 2,000 employees and provides health insurance services via a network of over 1,200 healthcare providers across the country. The Industry size, in terms of revenues, is estimated to be over N300 billion.

There is room for much growth in this Industry as a result of our population size and growing MSME and informal sector.

All that is required is for the policy makers to provide the much needed reforms and strategic actions to the sector and the Industry will expand significantly.

Overall, the healthcare industry in Nigeria is one of the most critically important and crucially fundamental sectors to any economy.