A unique low-cost private health insurance program in Namibia: protection from health shocks including HIV/AIDS
Africa today is bearing an extraordinarily large health burden as the epidemics of HIV/AIDS, tuberculosis, malaria and the opportunistic infections associated with some of these diseases put increasing demands on the healthcare sector. Health risk is one of the severest risks confronting poor households. Apart from the personal suffering it brings, illness can cripple a poor household’s income earning capacity. Sick individuals can no longer contribute to household income. On top of that, households must allocate resources to provide care within the family and cover the expenses of treatment. More than 150 million people globally suffer financial catastrophe every year due to out-of-pocket health expenditures. The surge of HIV/AIDS-related illnesses and deaths only exacerbates this problem. In the absence of access to free and good quality public care or health insurance, households are forced to resort to alternative coping strategies. However, for low-income households the depletion of savings, assets, or human capital may lead to a further eroding of their already poor asset base. For example, children might have to decrease their time in school and start working for income, care for their ill household member or take over domestic chores. In such circumstances, the benefits of health insurance schemes that include HIV/AIDS treatment are potentially large.
Currently, our knowledge is limited with respect to the impacts of private health insurance on health care utilization, health status and financial risk protection. In this article, we initiate a policy discussion around the potential role of private insurance to buffer health shocks, especially in the face of HIV/AIDS. We present a case study of Namibia where the Dutch organization PharmAccess has initiated a pilot program introducing the concept of low-cost private voluntary health insurance products.