Health Care Reform: an Opportunity for Insurance Industry Participation in Sierra Leone's Medical Care System

The socialized system of healthcare delivery andbeen borne exclusively by the government will
financing, a relic of the British colonial era, stillnow be based on a multi-payer system in which
practiced in Sierra Leone has glaringly failed andgovernment, employees and employers will all
any efforts at resuscitating it withoutparticipate.
implementation of major structural and systemicWith the system as currently structured
reform will only serve to prolong the inevitable.however, only the government has a financial
Throughout the world, total state control andinterest and stake and when other programs
management of industries, services, markets andconflict with the financing of health care, politicians
the means of production are gradually becoming ahave only been too willing to sacrifice the health
relic of the past. This model as practiced in theof their citizens on he alter of their greed and
Sierra Leone healthcare system has empiricallypersonal aggrandizement.
been proven to have served only to stifleIt is envisaged that health insurance providers will
innovation, growth, productivity and quality outputintroduce concepts and plans, such as Health
with a resultant decline in overall living andMaintenance Organizations (HMO) and Preferred
healthcare standards of the citizenry. The currentProvider Organizations (PPO), through alliances of
state of the hospitals and health centers glaringlyhealth providers and insurance companies and
highlights the systemic problems endemic in themarketed to employers, labor unions,
entire government owned, managed, financed andgovernmental ministries and corporations on an
operated health care system.annual premium basis.
The continued operation of such a decadent andThe competition engendered by such health
dilapidated delivery and financing system, lacking inorganizations for the medical insurance pie will
even the basics of a modern healthcaresubsequently result in competitive rates,
infrastructure continues relegating Sierra Leone tocoverage, deductibles, co-payments and
the very bottom of the human developmentpremiums to make health care costs affordable
index.for all.
The transformation thus of the medical healthcareThe Unemployed:
delivery and financing system into a privateAs unemployment and underemployment are
insurance or a national insurance based systemperennial problems in the Sierra Leonean
offers opportunities not only for insurers toeconomy, the provision of health care benefits to
develop market-based medical insurance plans andthis category of the population must remain the
policies but also serves to effectuate the Ministryresponsibility of government. Medical services
of Health & Sanitation's desired policy goals, asprovided to this category of citizens in a private
espoused in the 2002 National Health Policy Paper.enterprise environment must be reimbursed by
Both policy and regulatory officials, healthcarethe government on a negotiated and
providers, the insurance industry and otherpre-determined fee schedule or an insurance
stakeholders must be engaged to effectuatemechanism established in which government
implementation of fundamental systemic reformsnegotiates with providers and carriers for the
if the country is to avert an even greaterprovision of services.
catastrophe.As an example a fund established by levying
Privatization:taxes on the private health care providers,
Âenvisaged to emerge with such privatization, could
Under the proposed privatization plan, thebe instituted and utilized to pay for these indigent
Ministry of Health & Sanitation will be transformedservices.
from ownership and management of hospitals,Further, since the hospitals, medical clinics and
clinics, and employer of last resort for allother medical facilities will be operated as
physicians, nurses and ancillary healthcarebusinesses, either for profit or as non-profit
providers into a health agency with only policy andorganizations, the market forces of demand and
regulatory functions.supply will certainly ensure that patient quality
The goal will be for the health agency to serve ascare, improvements in diagnostic technologies,
a policy and regulatory watch dog mandated withcompetent personnel and a general
ensuring that adequate and quality medical care isresponsiveness to the demands of the clients will
provided at the various private hospitals, clinicsdrive the new marketplace. The lethargic and
and pharmacies that will inevitably be establishedinefficient atmosphere witnessed at most
with the break-up of the current governmentgovernment hospitals today with customer
owned facilities.service virtually non existent would be a
With the break-up and subsequent purchase orphilosophy of the past.
leases of these hospitals, clinics, health centersThe economic viability of healthcare businesses will
and other facilities, investors and entrepreneurs independ largely on the clientele they can attract
an effort to realize maximum returns onand maintain utilizing the above yardstick.
investments, will economically be compelled toProviders of lousy health care plans and services
upgrade quality and standard of care, introducewill inevitably loose business to competitors as
state of the art equipment and technologies andevery year participants will have an opportunity to
engender a type of market forces competitionchange health insurance plans.
which will inure only to the betterment of healthSince a large population of Sierra Leone resides in
consumers in the country.rural areas, the proposed privatization plan will
A much needed infusion of capital into the healthensure the expansion of health care facilities into
care industry by such a privatization plan willareas currently inadequately serviced. This plan will
clearly spur additional economic activities in ancillaryensure that clinics and doctors put up shop in
industries, as the dynamic forces of privatizationevery part of the country in order to tap into the
and market mechanism forces of demand andhealthcare services available in these rural areas.
supply will ensure competition for the healthcareChallenges to Insurance Companies:
pie.Designing an insurance system and plan to cater
Divestiture of Government Ownership:to the needs of the rural population who often
The dismantling of the current mammoth andare self employed in farming and mining activities
highly inefficient government owned healthcareposses a challenge to insurers in Sierra Leone,
delivery and financing entity must from a publicwho in the past have been largely passive and
policy perspective be designed and restructuredunimaginative in policy design to meet the
to ensure governmental ownership andchallenges and risks confronting the nation's
management divestiture from hospitals and othersocio-economic landscape.
health care facilities.Proactive and creative underwriting of risks must
Under such a scenario the government's currentbe undertaking by underwriters, actuaries and
enormous but woefully mismanaged capital outlaymarketing specialists to design, tailor and price
for health services will be substantially decreasedhealth insurance coverage to meet the diverse
as inefficiencies of corruption, salaries ofneeds of the insuring public. For example, the
providers, infrastructure maintenance, costs ofcreation of pools by occupational categories could
medications and diagnostic equipments and otherbe one method by which insured's, engaged in
overhead operating costs will no longer besimilar trades could be encouraged to form
recurrent expenditures from the nation's depletingco-operatives for purposes of obtaining health
coffers.insurance coverage at affordable rates for
A system based entirely on a privatethemselves and dependants. Premium payments
market-based national health insurance plan withthrough the pooling together of the co-operatives
private enterprise and market competition at itscommodities can be an alternative payment
core appears the most logical reform policy routemethod for the medical services. Health insurance
to ensure a future sound, efficient and profitablecompanies could possibly establish subsidiary or
health care infrastructure.ancillary companies solely for the handling of
 Health Insurance Plans:payments made by cash crops.
The cog which the proposed new system mustThe current system under which nearly all
revolve around is a nationwide network ofdoctors and related health care providers are
affordable health insurance plans creativelyemployed by the government while at the same
designed to ensure a greater pool participation oftime owning private practices would be changed
a majority of the population. In such a systemwith a concomitant government savings on
health insurance companies and providersalaries, productivity and other fringe benefits. As
organizations will be established to market variousprivatization takes over in the hospitals, physicians,
health plans, with minimum services and premiumsnurses and other providers will no longer be on
based on market conditions. The responsibility forthe government's payroll but will rather be
monitoring compliance by the various plans wouldindependent contractors with their own practices.
fall under the ambit of both the Ministry of HealthConclusion:
and Sanitation and the Sierra Leone InsuranceWhilst a micro version of the proposed reform
Commission.has mushroomed in an ad hoc manner over the
Multi-Payer System:years with some large companies and
A major plank in this proposed health carecorporations contracting with individual physicians
delivery and financing privatization hinges on theand clinics for the provision of health care to their
enactment of health insurance legislation providingemployees and dependants, the kind of systemic
for employers to provide health care for theirand structural overhaul needed to forestall a total
employees and dependants as part of a standardcollapse of the system and extend similar
benefits package with concomitant tax incentivesservices to all could only be realized by a
and governmental subsidies to ensure compliance.comprehensive approach along lines of reforms
With such legislation the virtual free socializedproposed in this policy paper.
medical care system, the costs of which have