Healthcare financing: Between Profit and Public Good


The achievement of Universal Health Coverage (UHC) is dependent on how healthcare systems are being financed and this has a ripple effect on the economy of nations and the global economy. This was affirmed by Judith Shamian, former president of the International Council of Nurses (ICN), who stated that the wealth of nations depends on the health of their populations

Selection of an adequate and efficient method of financing, in addition to organisational delivery structure for health services, is essential, if a country is to achieve its national health objective of providing healthcare for all, as posited by Carrin, Evans & Xu (2007).

To this end, various models or schemes exist in the financing of healthcare systems, depending on the countries involved and the resources available. Howbeit, basic models exist, with different countries adapting and domesticating them to suit their needs according to local realities and unique differences.

Comrade Olubunmi Akinola

While some countries approach healthcare financing with the consideration that health is a basic human right, and therefore make healthcare services available to all citizens, irrespective of their economic status or ability to pay, some others have viewed healthcare as a business and see no reason for governments to commit funds that will not yield profits into healthcare financing.

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The latter approach have made governments to embrace privatisation of healthcare services or Public Private Partnerships (PPPs), a concept that has arguments for and against. However, it is imperative to note that the basic goals of healthcare financing systems are to keep people healthy, treat the sick and protect families against financial ruin from medical bills. It is also important to note that the goal of healthcare systems is not profit-making as healthcare delivery should be seen as a public service and not a business venture.

This article will consider healthcare financing in Nigeria with a focus on PPPs and privatisation initiatives, explore arguments for and against them, and attempt to show whether this new trend translates to people over profit or profit over people.

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Healthcare financing

Healthcare financing involves the pooling, collection and deployment of funds from various sources, as well as the strategies and mechanisms employed to make payment for healthcare services and expenditures, as described by Yunusa et al (2014).

Obansa and Orimisan (2013) refer to health financing as the collection of funds from various sources (e.g. government, households, businesses, and donors) and pooling them to share financial risk across larger population groups and using them to pay for services from public and private healthcare providers.

They further identified the objectives of health financing to include: making funding available, ensuring appropriate choice and purchase of cost-effective interventions, giving appropriate financial incentives to providers and ensuring that all individuals have access to effective health services.

Nduaka (2018) posited that “health financing is the identification and mobilisation of resources for healthcare services. The application of these resources is also important. It should be geared towards meeting at least 80 per cent of medical needs of about 90 per cent of the populace.”

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Apart from involving funds allocation to various sections, regions, groups and specific types of healthcare, healthcare financing by any nation targeting economic growth and development must commit sufficient expenditure to health to achieve desired levels of health status and economic development, because there is a relationship between health and economic growth, while ill-health is a major cause of poverty or bankruptcy (Agbatogun & Taiwo (2010).

Yunusa et al. (2014) identified three sources of healthcare financing according to international literature to include: public, quasi-public and private sources. These sources however have considerable adaptations across countries as regards how revenue is generated from them and the relative weight of each of the sources when considering the overall financing of healthcare.

By Comrade Olubunmi Akinola, APNON National Secretary and Assistant General Secretary, Ogun State NANNM.



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