| Abstract: | The unique geography of Maldives, along with high dependence on imports and expatriate manpower, has meant that health services come at substantially higher costs than other countries in the region. In response, the country has undertaken several reforms in recent years to tbe way in which health is financed. Two of these prominent measures include the creation of seven health service corporations (defined by geographical area of operation) to manage the health facilities earlier directly managed by the Ministry ofHealtb and Family (MOHF), and the introduction of national health insurancescbemes (Madhana, and its variants "Madhana Plus" and "Madhana Basic"). The govel1lment has experienced several challenges as it bas embarked upon the implementation of these initiatives, and has a~·eady made several mid-coLLrse corrections in the Madhana scbeme. The World Bank has begun to engage with the Government to help ensure these initiatives achieve their desired impact This note is an input to that technical engagement, proposing some policy options for consideration.
As of March 2011, the social health insurance (SH1) scheme, Madhana, administered by the National Social Protection Agency (NSPA) under the Ministry of Health and Family, covered 77,500 people, which is about 25% of the country's population. The membership is primarily comprised of two large groups- all civil service officials and all senior citizens. The standardMadhana premium for each member is currently 2000 MRF per year (about USD 130), which is fuJly bome by the Govemment for its own officials (though not for the family members of these officials), tor senior citizens and for those living in abject poverty. Voluntary enrolment is offered to individuals willing to pay the prescribed premium (a partial public subsidy is available for voluntarily enrolling citizens earning below 17,000 MRF per year), but only a small propOltion of the population has taken advantage of this opportunity.
The scope of Madhana benefits is comprehensive and it covers inpatient and outpatient treatment subject to certain specified exclusions. A few cost control measures have been introduced in the scheme, but need to be expanded or refined. The insurance company acting as an administrator does not bear any risk , and thus lacks incentives to help control costs.
Madhana has many challenges to address and also several reform options to pursue. Though not in use presently, use of essential and generic drugs is part of the country's health master plan, and could also achieve substantial cost savings for Madhana. Voluntary enrolment is likely to remain small and highly prone to adverse selection, unless mechanisms to cover families (rather than individuals) and bring in formal sector employees are considered. Also, despite being under the MOHF, not many linkages exist between the scheme and the prevention activities of public health officials. The current design of Mad han a translates into poor internal controls and risk of leakages and cost escalation. This will not only drive increased govenunent expenditnre on the scheme (which the economy can ill-affo rd) but also contribute to spiraling health system costs which will ti.uther reduce financial access to health services. A redesigned Madhana would need to increase the reach of financial protection for health. reduce leakages and moral hazard, prevent cost escalation and build in robust monitoring systems. |
