The National Health Insurance Authority (NHIA) has announced a significant increase in capitation and fee-for-service payment mechanisms to improve service delivery and motivate healthcare providers.
This adjustment, it said follows an initial increase made six months ago as a 60% increase in capitation fees and a 40% increase in the fee-for-service payments.
This was introduced as a temporary measure to stabilize the industry and manage rising costs while awaiting a full actuarial review to establish sustainable rates.
The new rates which are approved by the Minister for Health and Social Welfare, Prof Muhammad Ali Pate, are based on the findings of the completed actuarial review and will be implemented from April 2025.
The Director General of the NHIA, Dr. Kelechi Ohiri announced the development at the NHIA -HMO Standing Committee Meeting in Abuja, on February 3rd, 2025.
Under the revised structure, capitation—fixed annual payments to health care providers per enrolled patients has increased by 93% compared to the rate in December 2023.
Meanwhile, fee-for-service payments, which reimburse specific medical procedures and services, have risen by 378% compared to the 2023 rates.
Specifically, these adjustments not only aim to address outdated rates but also to align compensation with the reality of rising medical costs, and incentive quality care.
Backed by actuarial analysis, the revised rates are designed to ensure fairness, sustainability, and improved healthcare service delivery.
These updates also strengthen consumer protection measures, ensuring patients receive better and more reliable care.
Commenting on the development, the NHIA DG, emphasized that the primary goal is to incentivize healthcare providers to deliver higher-quality services to enrollees.
He asserted that that the increases reflect the commitment of the NHIA, and other partners, to advance the Federal Government’s vision of an enhanced healthcare system, a healthier population and significantly improved national health outcomes.
“With the increase in premiums, we expect that the quality of care for enrollees will be improved and sustained. Providers are expected to deliver good quality care at no additional cost to enrollees, and NHIA will ensure strict enforcement,” he stated.
The revised tariffs aim to guarantee fair compensation, encourage providers to deliver top-quality services and mitigate rising medical costs.
Overall, the adjustments are tailored to provide better financial support for healthcare providers, leading to improved patient care and industry standards.
Stakeholders at the meeting, including heads and representatives of HMOs, Healthcare Provider Associations, and Committee of CMDs of Federal Tertiary Hospitals, commended the NHIA for the bold step to stabilise Nigeria’s effort towards Universal Health Coverage and the significant reforms being implemented.
They expressed their commitment to doing all they can to ensure that health insurance enrollees experience the impact of these changes.
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