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Badilisha Lugha KISWAHILI

National Health Insurance Fund: Role model for cheaper health care in Africa

17th March 2013

 The establishment of National Health Insurance Fund (INHIF) in Tanzania came out of necessity in the light of economic constraints that existed during the mid 1980’s.

It follows therefore that the main purpose of establishing the Scheme was to have a reliable and stable system of financing the health sector outside the general taxation system (which was by then overstretched) to ensure sustainability of services.

Arguably, Social Health Insurance (SHI) is a new development in Tanzania as the health sector reform agenda resulted into birth of prepayment schemes notably NHIF and CHF in the late 1990s. Thus, the concept of SHI is nearly a decade old and the benefits that come from it are now better understood in Tanzania than ever before.

In Tanzania, one of institutional set up that represents SHI is the National Health Insurance Fund (NHIF) established by Parliamentary Act No.8 of 1999 in order to facilitate access to health services among Tanzanians. Despite reforms in health care financing in Tanzania, the majority of the population (around 80 percent) is left without any form of health insurance.

In order to fill the coverage gap, the Fund is gearing up towards increased coverage through both CHF and NHIF windows. In a way, this limited coverage of SHI, necessitates the Government to pursue a dual financing approach of health care using tax finance and SHI. Nonetheless, the future of health care financing in Tanzania rests on the growth of social insurance propelled by the National Health Insurance Fund.

At its inception in 2001, the Fund was meant to cover civil servants only, but now the scope of its mandate has extended to include both the public and private sectors. In the recent past, college students, nuns, the clergy and other religious ministries have been brought on board the NHIF safety net. Many organized groups (SACCOS, VICOBAs, and Cooperatives) and individual members are also subscribing to the National Scheme (NHIF) in large numbers.

Fortunately, the design of the National Health Insurance Fund makes it possible for her beneficiaries to afford and access health services at all levels of service outlets anywhere in the Country.

Affordability of NHIF’s contributions is not debatable as all economically active people can join and get served. The Fund covers six individuals within a family -- one spouse and four children or legal dependants at a contribution rate of 6 percent of a basic salary shared equally between employee and employer.

This means that for an employee earning a minimum statutory wage of Sh180,000 will contributes Tsh. 10,800 per month that translates into a contribution of Sh1,800/= per head for six beneficiaries as required by the Law. By all standards, the NHIF contribution requirement is very affordable and compliance modalities are much friendlier. Pooling of incomes and risks and the resultant cross-subsidization among a large pool of members makes it possible for NHIF to finance health care more sustainably.

It should be noted at this juncture that the increasing trend of NHIF membership makes the Fund’s share in the National Health Account (NHA) very palpable, now accounting for 20 per cent an increase from 5 percent in 2003.

Another notable feature of the Tanzanian SHI (NHIF and CHF) is being pro-poor i.e addressing the health needs of the low income population segments particularly in rural- and sometimes hard-to-reach areas. For example, the contribution of a mere Sh5,000/= to Sh10,000/= per annum can afford a household to access primary health care in some Councils.

For example, in Igunga the same amount affords a household member to access referral services at tertiary facility level. Thanks to the wide network of public health facilities in Tanzania (big applause to MMAM), it makes it easier for the majority of rural-based beneficiaries to access NHIF/CHF services within their proximity. Without a wide network of health facilities particularly in rural areas, it would be difficult, if not impossible to implement SHI in Tanzania.

Equity and accessibility are also important features of the Fund that makes it stand out of the crowd. NHIF’s contributions do not vary according to age, health risk of the population to be covered and also that the size and standard of NHIF benefit package is the same to all beneficiaries regardless of their contribution amounts.

This is only possible with large pools of members, an advantage that NHIF enjoys now and the coverage is expected to grow further in the future. In addition, NHIF has accredited over 6,000 facilities all over the Country and that the NHIF Card is portable/mobile i.e a member/beneficiary can access health services all over the Country and at the facility of his/her choice.

Besides, in the eventuality of retirement, the Fund continues to cover the retired member and his/her spouse until the end of their lives without further contributions. These unique features make NHIF to be iconic in the delivery of health insurance services in the Region and also in Africa.

As regards to socio-economic development, the Fund continues to play a remarkable role. For example, in recognition of the need to improve health services’ infrastructures in the Country, the Fund has made notable funding through her Equipment and Facility Improvement Loan Project whereby the much needed medical equipment have been procured and health facilities have been refurbished in both urban and rural areas.

In addition, construction of a Medical Center of Excellence in Dodoma and a Teaching Hospital at UDOM is under way. These mega investments give leverage to Government funding of health related projects in the Country.

We conclude by stating that the successful evolutionary path of establishing SHI in Tanzania has made NHIF an envy of many African countries that aspire to incept social health insurance schemes.

In view of some best practices highlighted in the aforesaid, the Fund hosts now and again various foreign delegates from the Sub Saharan Region and beyond which come to borrow a leaf from the NHIF experiences in their endeavor to establish their own health insurance schemes.


Emanuel.B.D.Humba is the Director General of the National Health Insurance Fund (NHIF) which also administers Community Health Funds.



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