The Role of Health Insurance in Transforming Healthcare Access in Nigeria
Health insurance plays a crucial role in improving access to healthcare services, particularly in a country like Nigeria where the cost of medical care can be prohibitively high. According to Lekan Ewenla, Managing Director and Chief Executive Officer of Ultimate Health, a Health Maintenance Organisation, health insurance ensures that individuals have unhindered access to quality healthcare services defined for them. In developed countries, where health insurance is mandatory, people are free to visit designated facilities without worrying about the financial burden of medical expenses.
Ewenla highlights that 80% of healthcare services are accessed at the primary level, making it essential for Nigerians to have affordable and equitable access to these services. The introduction of health insurance in Nigeria aims to address the issue of poor health indices by ensuring that people can access care without facing financial hardship. Once enrolled, coverage lasts for 12 calendar months, providing continuous support for individuals and families.
Major Landmarks in the Health Insurance Sector in 2025
In 2025, one of the most significant milestones in the health insurance sector was the pronouncement by the President urging all ministries, departments, and agencies (MDAs) of the Federal Government to immediately enroll their workers in the public sector health insurance program. A circular issued by the Secretary to the Government of the Federation on September 14, 2025, emphasized that federal MDAs must enroll their workforce in the public sector social health insurance program. This directive targeted income-generating federal institutions that had previously opted for private health insurance programs instead.
The issuance of this circular marked a major achievement for the health insurance sector, as it followed the passage of a law mandating health insurance in 2022. However, the challenge has been the lack of compliance with the law by many Nigerians. The President’s mandate aimed to reinforce the importance of adhering to the law and ensuring that all citizens benefit from the health insurance system.
Expansion of the Directive to the Private Sector
The government’s directive was not limited to federal MDAs but also extended to the organized private sector. Employers of labor are now required to enroll their workforce in a health insurance program and request a certificate of compliance from the National Health Insurance Authority (NHIA). Private companies must enroll their employees through their appointed Health Maintenance Organizations (HMOs), which then formally request a Compliance Certificate on behalf of the company.
According to the law, every employer of labor with a minimum of five employees is required to enroll their workers in a health insurance program. This involves paying a medical allowance along with the staff salary and converting it into a health insurance premium for the entire staff. This process does not require employers to borrow funds, as the medical allowance is already allocated for this purpose.
Benefits of Health Insurance Beyond Financial Protection
Beyond financial protection, health insurance offers several other benefits. It contributes to the transformation of Nigeria’s healthcare infrastructure by generating significant revenue for the healthcare industry. This influx of funds can lead to increased investment in the sector, improving the quality of care and attracting skilled professionals.
Ewenla notes that the migration of Nigerian doctors and nurses to other countries is partly due to the lack of a robust health insurance system. Countries with mandatory health insurance programs have seen improvements in both healthcare quality and the take-home pay of medical professionals. By implementing similar strategies, Nigeria can achieve similar outcomes.
Challenges Facing the Growth of Health Insurance in Nigeria
Despite its potential, the growth of health insurance in Nigeria faces several challenges. One of the most prominent is the low level of awareness among the population. To address this, stakeholders such as the NHIA and HMOs need to conduct strategic media campaigns to educate Nigerians about the benefits of health insurance.
A document titled “One Nation, One Health” outlines a blueprint for achieving Universal Health Coverage in Nigeria. It proposes a uniform basic plan for all Nigerians, including the 83 million vulnerable individuals who would benefit from a dedicated fund. This initiative aims to ensure that everyone, regardless of location or economic status, has access to the same quality of healthcare.
The Importance of a Unified Database
Part of the Federal Government’s strategy is to use the health insurance program to develop a unified database for the country. Every individual registered in the program is required to provide their National Identity Number, ensuring accurate and comprehensive data collection.
However, there is still a need for state health insurance agencies to align with the national initiative. The adoption of the basic health plan across all states is crucial for driving the growth of health insurance. This will enable more people to access the basic package, with the option to enroll in supplementary or complementary plans if desired.
Clarifying Misconceptions About Health Insurance
There is a common misconception that health insurance is the same as healthcare services. Ewenla clarifies that health insurance is about managing health risks by pooling resources and providing defined services at an agreed premium. Healthcare services, on the other hand, involve accessing care at a facility with tariffs set by service providers.
He also emphasizes that health insurance is under the exclusive jurisdiction of the NHIA, while healthcare services fall under the concurrent list of the constitution. This distinction is important for understanding the regulatory framework governing the sector.
