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Key Text Health Microinsurance Schemes: Monitoring and Evaluation Guide, Volume 1: Methodology

Author: International Labour Organisation (ILO)
Date: 2007
Size: 260 pages (2.10 MB)

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Summary

What are the required capacities and key indicators of a viable health microinsurance scheme (HMIS)? This guide provides a tool to help in overcoming the lack of evaluation data on health microinsurance schemes. In countries with low levels of health insurance coverage, many health microinsurance schemes designed to reach the poor are emerging. There is growing recognition that health microinsurance schemes constitute a complementary and valuable strategy in extending social security.

A health microinsurance scheme is set up to achieve two main objectives: to provide financial protection against illness-related expenses and to improve access to health care services. This guide is relevant to two types of scheme: those set up and managed by and for their members, and those with no strong community participation. The latter includes most schemes managed by insurers and health care providers, and they may be public, private, not-for-profit or for profit.

Capacities required of a viable HMIS relate to:

Distribution and clear communication: Information on the scheme is effectively gathered through monitoring and analysis, communicated to members, and used to refine the approaches used
Membership monitoring and management: This involves the establishment, maintenance and analysis of a membership database that includes a history of coverage, premiums, and claims for each member.
Premiums collection: Efficient collection encourages enrolment in the scheme.
Claims processing and health care providers: Reports facilitate the detection of patterns in claims experience and claims management; treatment protocols are developed, followed and reviewed to maintain cost-effectiveness; and audits of service providers and surveys of client satisfaction are conducted regularly.
Management procedures: Plans focus on improving results and involve clear policies and procedures.
Quality of the risk portfolio: Information on claims experience and member satisfaction is analysed and applied in planning.
Financial statements: The scheme is able to produce an income statement, balance sheet and cash flow statement for a specified time period, measuring all costs.
Cash flow and investment monitoring: There is strict adherence to a (diversified) investment policy and the investment portfolio is constantly monitored to ensure that maturities and investment income match liability outflows.

In terms of key indicators of a sustainable HMIS:

Administrative viability is indicated by: The overall quality of monitoring (administrative procedures that monitor all aspects of operations)
Functional viability is indicated by: The renewal rate - the number of members renewing membership in the current period as a percentage of the cohort of members covered in the previous period.
Financial viability is indicated by: The scheme's ability to meet short-term cash flow needs; the operating expense ratio (value for money); the ratio of claims paid to earned premium; and the level of asset diversification.
Economic viability is indicated by: A break-even or slightly positive net income
Institutional viability is indicated by human resource capacity and net investment in training: Capacity-building of staff is a qualitative measurement based on assessing staff requirements and providing training to improve skills.
Effectiveness is indicated by: The utilisation rate (the number of times HMIS beneficiaries use a particular service in relation to the total number of beneficiaries) and the penetration rate (the percentage of the target population covered by the scheme).
Impact is indicated by: The impoverishment rate (the percentage of patients who were impoverished or had experienced a catastrophic health expenditure at the time of enrolment in the scheme); and the population coverage rate (the percentage of the total population to whom the HMIS provides services).

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Source: International Labour Organisation (ILO), 2007, 'Health Microinsurance Schemes: Monitoring and Evaluation Guide, Volume 1: Methodology', Strategies and Tools against Exclusion and Poverty Programme (STEP), International Labour Organisation (ILO), Geneva
Organisation: International Labour Organisation, http://www.ilo.org/