the National Social Health Insurance Scheme. In the article “Insurers wary of National Social Health Insurance Scheme,” The New Vision October 25, 2007, both the insurers and the Ministry of Health appeared to be at cross-purposes over the National Social Health Insurance Scheme. However, in the ears of most of our people – who would be key players in the system – health insurance is a novel concept, about which sensitization would have been in order.

Health insurance is a health system – a specific form of a health system – in so far as it is an organized social response to our health problems. It is a system inclined to limit its functions to guaranteeing access to goods (drugs, prosthesis, etc) and to services (care, and so on). It is an institutional arrangement involving risk management, and tends to establish logic of solidarity in its financing. Like any other health system, it is connected with management, financing and care.

There are various types of health insurance schemes, competing in the ambience of managed competition, from which the health ministry could have selected a system tailor-made for Uganda, for example, Social Security Insurance Scheme or Universalist Insurance Scheme, where reforms have been incorporated in the social system. This would basically mean an adoption of a Welfare State and a legal re-organisation of the health services. Strictly speaking, “social insurance” and “social security” systems are different. The differences are described in the following paragraphs.In social insurance schemes, a distinction may be made between social plans of a decentralized nature and those whose administration depends directly on the national government.At the present time, the concept of Social Insurance implies an assurance association from which the participants cannot withdraw; where government has a minor role, and the scheme has a much more decentralized management.

The organization is based more on regulation than planning. Financing is from assessments and contributions from employers and the workers. The contributions are mandatory and administered by the interested parties themselves. Management of resources and the organization of the services are carried out by non-government intermediary organizations, which contract services with private or public providers.

They cover only contributors and their family groups. Is this the insurance plan the health minister envisages for the people of Uganda?By contrast, the Social Security or Universalist Insurance systems are characterized by public financing with resources originating in taxes and universal access to the services, which are generally supplied by public providers. Professional and non-professional workers depend on government. There are other sources of funding in addition to taxes, for example, direct payments by users and other contributions. The organization and management, assume more participative and communal forms. Despite all that, governments continue to bear the brunt of social security financing and management. In comparison with the Social Insurance type, Social Security Insurance scheme emphasizes the role of the government as provider. The Social Security or Universalist Insurance schemes seem, by inference, more like what the minister had in mind, although he did not specifically say so.

All health insurance systems may be regarded as consisting of three connected elementary component parts: management, financing and care. Hence, it is a matter of grave concern to recall that the article had reported that serious lack of satisfaction had been expressed, about the health ministry’s ability to manage finances. That had cast great doubt on the health ministry’s suitability to handle health insurance, in which institutional management, financing and care form integral component parts! The article went on to state, “the ministry lacks any technical insurance person and yet it feels it is almost ready to role out such a huge scheme.

”If the excerpt is to be believed and the ministry of health insist that they will operate a health insurance scheme in their present circumstances, I would say that they are either bluffing or they do not quite appreciate the critical role of effective institutional management, in successfully implementing a health insurance system.Operating a health insurance requires far more expertise than is generally realized. As a result, it is sometimes difficult to find specialists, who have the technical and business, institutional management skills, necessary to implement and operate a health insurance scheme.

Recruitment of qualified individuals (which may include looking outside public service), clear definition of job responsibilities, adequate training and preparation for specific job assignments, are all essential to achieve good staff performance. Short of this, the health ministry would do well to consider hiring health insurance companies, to take up that responsibility for and on behalf of the health ministry.A health system is a composite system in which management, financing and care articulate. These systems, being institutional arrangements, assume objectives derived from their missions and from the values they pursue. The deciding factors on management of a health insurance scheme are:

Whether the insurance is public or private What are its values?

Who is targeted by the insurance?1) The financing of a health insurance may come from public or private sources, as previously stated. However, the manner of securing resources does not necessarily imply a specific modality of organization of the functioning of a health insurance. In fact, there are private insurance companies which operate as corporations for profit that use resources coming out of public sources.

Then there are those companies which function as public companies, usually as decentralized entities, to grant them relative autonomy from government.Lastly, there are non-profit insurance companies constituted in the form of private corporations.2) Every health system stresses specific aspects over others. Management of a health system is expected to be able to define a health system’s priorities, including decisions which must be taken routinely by management. In other words, management is expected to analyse and distinguish the values which guide the health system.Social Insurance and Social Security/Universalist Insurance systems are being compared to see which system would best emphasise the following four central values, namely: (a) solidarity, (b) universal coverage, (c) equity, (d) effectiveness.Solidarity value: indicates that insurance group members contribute the same, proportionate to their individual income, and they can each receive medical care when they individually need it.In insurance, solidarity may be shown in different ways: solidarity with those in the same or similar status, that is, mechanical solidarity and, solidarity with those in a different social status, that is, organic solidarity.From what we already know about the Social Insurance system, it is clear that this system involved a mechanical aspect of solidarity; because contributors contribute proportional to their means, but they proceed to receive medical services according to their individual needs, not according to their income.The Social Security system is different. Once universal coverage has been attained within a specific society of people, this insurance system allows the same conditions of access to health services to all, irrespective of their economic or labour status. This system involves an organic aspect of solidarity.(b) Universal Coverage Value: By definition, the Social Insurance System permits a progressive expansion towards universal coverage. The Social Security system is universal.(c) Equity value. Any of the following conditions relates to there being equity:-When each individual receives the treatment that person needs. This way, a system may be equitable vertically or horizontally. Vertical equity promotes unequal treatment for unequal pay, that is, each is provided for in accordance with his/her needs. Horizontal equity corresponds to equality, that is, equal treatment is provided for equals.When a possibility of receiving care during each episode of sickness, whatever level of complexity, is the same for each and all.

When, irrespective of anything, all sectors of the population attain equivalent health results measured by classic indicators. For example, life expectancy and rates of morbidity and mortality.

(d) Effective value. Increasing quantity and quality to life is the mission of all health systems. The extent to which this objective is realized is the efficacy of the system.(e) The beneficiaries of the insurance plan are the product of the mechanisms by which the insurance system is funded. The Social Insurance System has its financing linked to salaried work and tends to concentrate its clientele amongst workers and then their family groups. It does not define how to attend to the needy and the unemployed.Traditionally, business sectors and higher income groups do not obtain health goods and services through insurance, but direct from the market.

The Social Security insurance is implemented to cover the entire population in the same manner and, to achieve that end, call on various sources for funding.The major emphasis in this article has been on comparative choice of a pertinent health insurance system to cover most, if not all, of the people of Uganda and, the critical role of effective management in successfully implementing a health insurance scheme. There now remains only a few notable comments to be made on the other two

component parts of a health system, that is, financing and care.FINANCINGThe financial problems in planning and maintaining health insurance schemes are substantial, but analytical approaches to those problems are available. The greatest problem may be in convincing ministry of health decision-makers and other key individuals that a businesslike approach is necessary for the scheme to succeed.To avoid some of the common pitfalls n insurance schemes, careful and systematic financial planning is essential. Such planning should carefully consider: The cost of offering medical coverage to people, bearing in mind the following:

(a)-marketing factors affecting demand for and supply of services and noting that to achieve economies of scale a health insurance requires at least 200, 000 beneficiaries-the coverage plan selected

-the price of services and,

-the offer of services.Besides the effect of these four factors in any one particular situation is the tendency of health expenses to escalate all the time; although there is a concerted effort, everywhere, to contain the tendency. Moreover, the characteristics of the modality of producing health services are such, that incorporating higher levels of technology does not reduce health personnel expenses; so that technological innovation tends to increase expenditure.(b) The sources for financial health insurance may be public or private, as we recall. The public sources correspond to systems whose resources are guaranteed by government through laws, standards, decrees, etc…These are resources obtained through contributions based on payrolls of employees in the formal sector of the economy. In some cases, there is a tripartite scheme, in which government complements contributions with government resources collected through taxes.Changes in the economy, especially in countries’ tax bases, are bringing about a redefinition of the sources of finance for health activities. Before long, the link between the financing of health expenses and work, may be replaced with other sources.(c) Resource assignment problems are widespread and specific to each insurance plan. It is no simple matter to state what payment instruments ought to be used to purchase services. However, replacing the model that finances sources with models which subsidise demand, seems to be winning the day. The traditional manner of financing health care has been rephrased. It is now subsidy of demand.The advantage of financing the supply is rooted in the fact that it facilitates vertical planning and grants central health authorities maximum control over the supply resources. Its disadvantages are related to the limitations of administrative centralization.CARE

This component is the most technical dimension of the health care system, because it is strictly medical and health-related. It concerns itself with what care is to be provided and, with how and where care should be provided.But even so, no health insurance system can offer coverage for all medical applications offered by medical science and, the technology assisting health services. It is economically impossible to do so. What then is the criteria to limit the amount and variety of care covered by insurance?Insurance plans have tried to operate with implicit as well as with explicit limits. Social insurance plans have, by and large, accepted the explicit limits through standards and lists.

Positive lists means goods and services are actually covered by insurance.Negative lists means goods and services are not covered by insurance.

The strategy of social insurance involves a single coverage plan, that is, social insurance will tend to have a single rationing scheme.There were various technical models to establish coverage priorities and limits to the provision of medical care, before the “Report on World Development” by the World Bank came out some years ago. The Report proposed the implementation of basic health care “baskets” on the basis of a model of evaluation of the cost-effectiveness of health care provision. Various countries have taken action along that line since that time.It is important to define what providers must be accountable for in the provision of services, in view of the complexity or the adequacy of the quality of services. Siimilarly, the guiding principles in the executition of their duties must be stated. Medical knowledge, in the execution of care, is necessary.

For implementation of care, both the health ministry and health insurance companies would be well-matched, if the latter opted for a closed plan, for the re-organisation of their medical services. In the closed plan, the supply of medical treatment is limited to the set of institutions and professionals authorized by the insurance plan to provide medical care to its members. In this direct or closed plan, a contract between the insurance company and the care providers is drawn up. The insured person seeks medical service from a listed provider. The listed professional provides the medical services and he is subsequently paid for that work by the insurance company, through a variety of pay systems previously agreed upon.Although experiences to-date have provided considerable insight into the potential benefit and common pitfalls of health insurance plans, and health economists have accumulated valuable information on the subject, there remains many issues for future analysis and research in that direction. The subject cannot be considered exhausted. Indeed, some time back it was suggested that implementation of health insurance, should include social marketing activities, directed at both health care providers and the beneficiaries. They are both effective and appropriate to public health entities. Without people’s understanding, acceptance and support, the development and growth of health insurance may prove problematic.About the author: Mr. A.M.M. Kaddu is a company pharmacist.