Assessment of Health Insurance’s Role in Reducing Financial Barriers to Health Service Access: Perspective from a Resource Limited Setting

Abstract

In Ethiopia, Community-Based Health Insurance (CBHI) schemes aim to enhance healthcare accessibility and reduce financial barriers to health care access by providing protection against out-of-pocket (OOP) expenses. However, evidence on the institutional experience of insured patients remains limited. This study explores the financial implications of CBHI membership among inpatients at St. Paul’s Hospital Millenium Medical College. A cross-sectional study was conducted in St. Paul’s Hospital Millenium Medical College Inpatient Departments. After stratifying across different wards, the study participants were chosen by systematic random sampling. Data on socio-demographics and payment related factors were collected with a structured questionnaire. Ethical approval and informed consent were obtained. About 260 respondents, of whom 168 (64.6%) were CBHI members and 92 (35.4%) were non-members, had participated in the study. The result reveals that both CBHI members and non-members continue to bear OOP expenses, undermining the financial protection intended by the scheme. Among CBHI members, self-sponsored out-of-pocket payments along with health insurance (65, 38.7%) were the major source of financing. The significant reduction in reported difficulty in paying for basic necessities among CBHI members compared to non-members (P = .034) does suggest that the insurance offers some level of financial relief. While CBHI provides some financial relief, gaps in coverage need more in-depth exploration.

Highlights.

● Community Based Health Insurance (CBHI) members still incur out-of-pocket (OOP) payments.

● CBHI membership is associated with reduced difficulty in paying for basic necessities.

● Lack of awareness and lapsed memberships are the top reasons for lack of CBHI membership.

● The capacity of CBHI to enhance health access can be improved by evidence-based improvements to the provided services.

Introduction

Providing universal health care coverage to Ethiopian citizens has been the priority of the health policies launched in Ethiopia ever since 1995. The initial efforts mainly focused on growing the quantity of healthcare providers. To that effect, in the periods of the Health Sector Development Plan I-IV the number healthcare institutions grew exponentially. This period also saw the introduction of health posts as a way of further growing the reach of healthcare.^1,2 A thorough assessment at the end of this policy period revealed that the per-capita measures of outpatient visits and hospital admission reports indicated low service utilization as compared to the expansion of health facilities within accessible distance. ³

One of the barriers identified in this regard is financial. The national health account published in in 2014 Gregorian Calendar showed that 37% of the total health care expenditure consisted of out-of-pocket payments, and it was deemed as an outdated practice that impedes access to health services. So, the government devised an initiative to establish a social and community-based health insurance ran by the Ethiopian Health Insurance Agency. While social health insurance is intended for people working in officially recognized jobs, community based health insurance is intended for the majority of the population that operates in jobs outside of official oversight such as street vendors or manual laborers. Since then, community-based health insurance (CBHI) had passed the piloting phase and has been implemented.^3,4

CBHI was launched with the promise of promoting health service utilization, avoiding unexpected OOP at point of service utilization, protecting from impoverishment, ensuring equitable health care delivery, kindling health service quality improvement through community ownership and increasing per capita health expenditure.^5,6

CBHI has been operational for nearly a decade organized on a district level where community leaders rally at least 11 households, and then register within their administrative unit. The CBHI unit will then contract various health providers, within which beneficiaries can receive various healthcare services for free. Lest for a few exceptions, such as injuries, medical check-ups and organ transplants, most outpatient, inpatient, surgical, obstetric and diagnostic services as well as generic drug distribution are covered. The CBHI unit will be overlooked by the general assembly, which is the executive body with members from the district office and community leaders. Members pay a yearly premium payment of 500 Ethiopian Birr (approximately USD 10), while there is a reduced fee of 240 Ethiopian Birr (around USD 5) for dependents aged above 18 years. And once a member is registered, he/she can enlist their dependents for coverage. The insurance contract lasts for a year and needs to be renewed annually. At the end of the financial period, the various health providers will file a claim and collect their funds.^7,8

Literature Review

Healthcare costs have been shown to act as a barrier hindering access to health services. There is substantial evidence that shows health insurance can play a crucial role in overcoming this obstacle. This is of great importance because improved healthcare access is strongly associated with better health outcomes.^5,9,10 Not only that, but uninsured individuals also often experience worse health outcomes and higher rates of morbidity and mortality. ⁹ So much so, that the absence of health insurance is seen as a matter of health inequity. ¹¹

This conclusion aligns with the Grossman model, which suggests that health insurance increases healthcare use by lowering direct costs. However, in low-resource settings, some researchers argue that financial barriers alone are not the only challenge. To truly improve healthcare access, health insurance was suggested to be combined with improvements in the healthcare system and other socio-economic factors. ¹⁸

In Ethiopia, the impact of health insurance on healthcare access remains underexplored. While several community-based studies have shown that insurance helps reduce out-of-pocket expenses and catastrophic healthcare costs, its broader effects on access and quality of care need further investigation.^{12 -14} Some studies indicate that patients enrolled in Community-Based Health Insurance (CBHI) tend to have more outpatient visits compared to those without insurance. However, whether this increased utilization translates to better health outcomes remains an open question members.^{12,14 -16}

Although these findings suggest progress toward achieving universal health coverage, there is still a gap in our understanding of the impact of health insurance in facility-based settings.^15,17 This in-depth exploration is particularly important in Ethiopia because poverty can have a negative effect on the effectiveness health insurance in improving access to healthcare. ¹⁸

Problem Statement

Most of our understanding of CBHI comes from community studies. But the institutional experience of patients is needed to build a complete understanding. Assessing the application of CBHI at the point of care could serve as a critical assessment of patients’ experience. The objective of this study is to examine the payment profiles of CBHI member and non-member inpatients at a tertiary hospital in Ethiopia.

Materials and Methods

This study was an institutional cross-sectional study conducted among patients hospitalized in internal medicine, gynecology, pediatrics and surgical wards at St. Paul’s Hospital Millenium Medical College (SPHMMC), Addis Ababa, Ethiopia from 10th April till 29th May 2023.

A combination of stratified and systematic random sampling procedure was used to ensure inclusion across the different inpatient wards. Patients were stratified by ward, and a random selection process was applied within each stratum to identify participants. Consenting inpatients hospitalized during the study period were included in the study. Patients were excluded if they declined to provide consent or if they had a serious medical or mental illness that may prohibit them from comprehending the aim of the research or the questions in the questionnaire. Patients who were enrolled in other forms of payment plan, such as private insurance, corporate credit payment plan and those entitled to free service at the hospital (obstetric patients and neonates), were also excluded from the study because the type of service covered and co-payment plan may differ that of the CBHI.

A CBHI member is defined as an individual with a valid registration under the CBHI scheme, either through their own enrollment or as a dependent of someone else. Conversely, a CBHI non-member is an individual without a valid registration for these benefits. The independent variable in this study is the CBHI membership status of the patient, and the dependent variable is the source of payment.

Sampling was designed to reduce selection bias and ensure the study population represents the target population.

The sample size was calculated using Open-Epi, version 3 open-source sample size calculator. According to the data from St. Paul’s Hospital Millenium Medical College Department of Informatics the total number of annual inpatients was taken as 5294 ¹⁹ ; Ethiopian Health Insurance Agency and P (CBHI members) was taken as 9.64%. ⁶ With a 95% confidence interval, a design effect of 1 and a 10% non-response rate the total sample size was 245.

A data collection tool was developed by reviewing literature. The questionnaire had 2 sections; the first section pertained to participants’ general socio-demographic information and the second section contained questions the payment aspect of the study participants.

The section on payment aspect was different for CBHI members and non-members. The questionnaire was translated to Amharic language and then back into English to check for consistency. Furthermore, a pre-test was conducted to check for issues on clarity, structure and flow of the questionnaire. Feedback from participants were used to refine the questionnaire to improve understandability and remove redundancies. Finally, the researcher administered the questionnaires and collected the data. In accordance with the calculated margin of error, the collected data is believed to be acceptable. The investigator had checked the adequacy, accuracy, clarity, and consistency of the data thoroughly during data entry.

The study was conducted after getting ethical clearance from SPHMMC Institutional Review Board. Selected patients were well informed of the aim, procedure and expected benefits of this study and verbal and written consents were taken before questionnaires were administered. In addition to this, study subjects are not to be identified by name to maintain confidentiality. The collected data was cleaned, checked for completeness and then entered and analyzed by Statistical Package for Social Sciences (SPSS) Version 20. Responses with incomplete data was removed completely from analysis.

Statistical Analysis

Both descriptive and inferential statistics were done with SPSS Version 20. Descriptive statistics were used to summarize the socio-demographic characteristics of the study population. Frequencies and percentages were calculated to provide an overview of these variables. Chi-square tests were used to evaluate the significance of relationships between categorical variables and the ability to pay for basic necessities across different CBHI membership status. A 5% level of significance (P < .05) was used to determine statistical significance. STROBE cross-sectional guidelines were used as a suggestive guide in writing this manuscript.

Result

The study participants comprised 260 individuals, with a nearly even distribution between males (135, 51.9%) and females (125, 48.1%). Approximately two-thirds of respondents were enrolled in CBHI (168, 64.6%), while about one-third were not (92, 35.4%). The majority of participants were aged 26 to 35 years (66, 25.4%), followed by those aged 36 to 45 years (51, 19.6%). The largest group of insured individuals is aged 26 to 35 (39, 15.0%). CBHI uptake increases in older age groups, with the highest rate in those aged > 66 years (28, 10.8%), compared to the youngest group, 18 to 25 years (15, 5.8%), but these differences aren’t statistically significant (P = .547) Only 13.1% (35) of the participants had attended university level higher education and they represent smaller insured groups. Most of the participants are at a first to sixth grade level (47, 18.1%). The majority of participants were from the Oromia Region (43.5%) and Addis Ababa City (37.3%). Insurance uptake significantly varies by region (P = .041, df = 7), with the highest insured rates in Oromia (76, 29.2%). Most participants are married (206, 79.2%), and married individuals also have the highest proportion of insured individuals (137, 52.7%). Most respondents earn between 600 and 3500 (77, 29.6%), which also accounts for the largest insured group. However, income level does not significantly affect insurance uptake (P = .867). Most respondents stayed in the hospital for more than 3 days (125, 48.1%). Participants living closer than 5 km to a healthcare facility represent the majority (121, 46.5%). These factors do not significantly associate with insurance status (P > .05; Table 1).

Table 1.

Sociodemographic characteristics of respondents across different CBHI enrollment status. ¹⁹

Variables	Categories	Frequence/Percentage	Insurance		Total	df	P
			No	Yes
Sex	Female	Frequency	44	91	135	1	.328
		Percentage	16.9	35.0	51.9
	Male	Frequency	48	77	125
		Percentage	18.5	29.6	48.1
Age	18-25	Frequency	11	15	26	5	.547
		Percentage	4.2	5.8	10.0
	26-35	Frequency	27	39	66
		Percentage	10.4	15.0	25.4
	36-45	Frequency	18	33	51
		Percentage	6.9	12.7	19.6
	46-55	Frequency	14	32	46
		Percentage	5.4	12.3	17.7
	56-65	Frequency	13	21	34
		Percentage	5.0	8.1	13.1
	>66	Frequency	9	28	37
		Percentage	3.5	10.8	14.2
Address	Addis Ababa City	Frequency	33	64	97	7	.041*
		Percentage	12.7	19.2	31.9
	Afar Region, Dire Dawa City, South West People’s Region	Frequency	1	3	4
		Percentage	0.4	1.2	1.5
	Amhara Region	Frequency	5	11	16
		Frequency	1.9	4.2	6.2
	Oromia Region	Percentage	37	76	113
		Frequency	14.2	29.2	43.5
	Southern Nations, Nationalities and People’s Region	Percentage	12	12	24
		Frequency	4.6	4.6	9.2
	Tigray Region	Frequency	4	0	4
		Percentage	1.5	0.0	1.5
Marital status	Single	Frequency	18	21	39	3	.246
		Percentage	6.9	8.1	15.0
	Divorced/ Separated	Frequency	5	10	15
		Percentage	1.9	3.8	5.8
	Married	Frequency	69	137	206
		Percentage	26.5	52.7	79.2
Educational status	Illiterate	Frequency	22	39	61	7	.297
		Percentage	8.5	15.0	23.5
	First to Sixth Grade	Frequency	9	38	47
		Percentage	3.5	14.6	18.1
	Ninth to 10th grade	Frequency	14	23	37
		Percentage	5.4	8.8	14.2
	Seventh to Eighth grade	Frequency	12	16	28
		Percentage	4.6	6.2	10.8
	11th to 12th grade	Frequency	13	19	32
		Percentage	5.0	7.3	12.3
	Diploma	Frequency	7	14	21
		Percentage	2.7	5.4	8.1
	Bachelor’s	Frequency	12	17	29
		Percentage	4.6	6.5	11.2
	Master’s	Frequency	3	2	5
		Percentage	1.2	0.8	1.9
Monthly income	0-600	Frequency	21	32	53	4	.867
		Percentage	8.1	12.3	20.4
	600-3500	Frequency	38	77	115
		Percentage	14.6	29.6	44.2
	3500-10 900	Frequency	26	50	76
		Percentage	10.0	19.2	29.2
	>10 900	Frequency	7	9	16
		Percentage	2.7	3.5	6.2
Hospital stay	Less than 1 day	Frequency	3	12	15	2	.434
		Percentage	1.2	4.6	5.8
	More than 3 days	Frequency	72	125	197
		Percentage	27.7	48.1	75.8
	1 to 3 days	Frequency	17	31	48
		Percentage	6.5	11.9	18.5
Nearest healthcare facility	Closer than 5 km	Frequency	76	121	197	2	.163
		Percentage	29.2	46.5	75.8
	Further than 5 km	Frequency	15	44	59
		Percentage	5.8	16.9	22.7
	I don’t know	Frequency	1	3	4
		Percentage	0.4	1.2	1.5
Insurance status		Frequency	92	168	260
		Percentage	35.4	64.6	100

^*Significance at P < .05.

For respondents who are enrolled in CBHI, self-sponsored out-of-pocket payments along with health insurance (65, 38.7%) were the major source of financing. As for respondents who aren’t registered for CBHI, the most important source of out-of-pocket payment is self-sponsored and money from friends and family (35, 38%; Figure 1).

Figure 1.

Upset plot showing the source of finance for CBHI members and non-members. ¹⁹

The majority of the uninsured respondents (90, 97.8%) stated that after their current hospital stay, they plan to register for CBHI. ¹⁹

Lack of awareness about CBHI (39, 42%) and expired memberships (34, 37%) are the top causes for lack of insurance among CBHI non-members (Figure 2).

Figure 2.

Bar graph showing the reason for lack of CBHI. ¹⁹

There is a statistically significant reduction in the proportion of participants who reported difficulty in paying for basic necessities when comparing CBHI members to non-members (Table 2).

Table 2.

The association between insurance status and ability to pay for basic necessities. ¹⁹

	Inability to pay for necessities		df	P
Insurance status	No	Yes
CBHI non-members Count (%)	29 (31.5%)	63 (68.5%)	1	.039*
CBHI members Count (%)	75 (44.6%)	93 (55.4%)

^*Significance at P < .05.

Discussion

Consistent with the rural population-centric design of Community-Based Health Insurance (CBHI), a significantly higher proportion of insured individuals in this study were from Oromia, a predominantly rural region. This aligns with CBHI’s goal of improving healthcare access for rural communities.

Supporting previous studies that highlight the financial protection offered by CBHI, the findings show a significant reduction in reported difficulty paying for basic necessities among CBHI members compared to non-members (P = .034). This shows the program’s potential to alleviate financial strain on households.

Despite its intended purpose of reducing out-of-pocket (OOP) payments this study highlights that CBHI members face substantial financial challenges in accessing healthcare. For CBHI members, the dual burden of insurance premiums and residual OOP expenses suggests inadequacies in the program’s coverage. These inadequacies may be one cause for a significant proportion of lapsed memberships among uninsured participants and it may stem from a combination of factors, including limited services offered by contracted hospitals and the absence of partnerships between CBHI schemes and private-sector healthcare providers. This is consistent with evidences that underscore the importance of improving health service along with health insurance to improve health access in low-resource settings.

The findings echo the need to examine the impact of health insurance on health access and financial protection across different health services. Further studies also ought to isolate respondents with lapsed memberships who may wrongly self-report as being CBHI members.

In interpreting the findings of this study, these limitations must be considered. CBHI enrollees may differ significantly from non-enrollees in their clinical or demographic characteristics, and this may bias the results. The research also doesn’t measure the magnitude of OOP expenses in health expenditures, so it is limited in its capacity to show the financial strain on participants. There might also be some inaccuracies due to reliance on self-reported data.

Conclusion

Despite the promise of financial protection through CBHI, both members and non-members continue to experience significant OOP expenses. This highlights the need for evidence-based reforms in the CBHI scheme as well as hospitals to enhance its effectiveness.