A Review of the Appropriateness of User Fees and Social Health Insurance to Fund the Health Care Systems in Low and Middle-Income Countries

Lucky O Onotai


Background: User fees and social health insurance (SHI) are key strategies of healthcare funding. These strategies which have been widely adopted in low and middle-income countries have been shown to be rarely beneficial to poor people. There has been doubt on their capability to facilitate improved access to healthcare services especially for the poor. Hence, this paper discusses the appropriateness of user fees and SHI in the funding of healthcare systems by critically appraising their strengths and weaknesses. It will also draw attention of government to alternative methods that can help deal with healthcare funding especially for the poor population.

Materials and Methods:  A search of some standard books and relevant articles on the appropriateness of user fees and social health insurance to fund health systems was carried out using the Google, Yahoo search engine, EMBASE and OVIDMEDLINE data bases.

Results: The main goal of a healthcare system is to improve the health of the whole population and meet the key needs of the healthcare system. User fees have been described as the most regressive way to pay for health. In countries where SHI is the predominant source of funding the poor people are likely to be excluded from participating because they do not have regular employment for meeting regular payments.

Conclusion: User fees and SHI funding mechanisms seem inappropriate to fund healthcare systems of low and middle-income countries because of extreme poverty. Governments should explore other alternative methods of healthcare funding that can help tackle healthcare funding especially for the poor population


User fees, Social health insurance, Healthcare funding


World Health Organisation. The World Health Report 2000: Health Systems: Improving performance. Geneva World Health Organization. www.apps.who.int/gb/archive/pdf_files/WHA53/ea4. pdf. Accessed on the 7th of December 2009.

World Bank, 2009; World Bank list of economies; http://go.worldbank.org/D7SN0B8YU0 . Accessed on the 21st April 2009.

World Health Organisation, 2001; Report of the Commission on Macroeconomics and Health. Geneva: World Health Organization.www.apps.who.int/gb/archive/pdf_files/WHA55/ea55 5.pdf. Accessed on the 5th of November 2009.

Conn, C.P and Walford, V. An introduction to health insurance for low income countries: IHSD Limited, London.https://www.who.int/contracting/bibliography/Biblio graphy-Contracting.pdf. Accessed on the 4th of January 2010.

Musgrove P, Zaramdini R. A summary description of health financing in WHO member states. WHO/CMH Working Paper Series, Paper No. WG3:3. Geneva: 2001.World Health Organization.

World Bank. Voices of the poor: can anyone hear us? 1999 Vol.1. Washington, DC: World Bank.

World Bank. Financing health services in developing countries: An agenda for reform. Policy Study 1987; PUB-6563. Washington, DC: World Bank.

Mwabu G. Financing health services in Africa: An assessment of alternative approaches. Working Paper, 1990; Series 0457. Washington, DC: World Bank.

Gilson L, Kalyalya D, Kuchler F, Lake S, Oranga H, Ouendo M. Strategies for promoting equity: experience with community financing in three African countries. Health Policy 2001; 58(1): 3767.

Palmer N, Mueller D, Gilson L, Mills A, Haines A. Health financing to promote access in low income settings-how much do we know? Lancet 2004; 364: 136570.

Park JE. Text Book of Preventive and Social Medicine. Bhenot Publishers Jabalpur. www.ijmm.org/article.asp?issn=0255-0857;year=2002 ... Accessed on the 4th of December 2009.

World Health Oorganisation. The world health report 2002 - Reducing Risks, Promoting Healthy Life: Geneva: World Health Organization. www.who.int/whr/2002/en/whr02_en.pdf. Accessed on the 3rd of January 2010.

Walshe K, Smith J. Health care management; www.flipkart.com/healthcare-management. Accessed on the 3rd of December 2009.

Bennett S, Gilson L. Health Financing: designing and implementing pro-poor policies; DFID Health System Resource Centre London.www.dfidhealthrc .org/health.financing/Health_financi ng_pro-poor.pdf. Accessed on the 2nd of January 2010.

Rovira J, Mompo C, Wildt K, Schneider M, Blasco I. Comparing cost sharing in European Union member states: A system oriented framework, in Leidl, Reiner. Health care and its financing in the single European market. Amsterdam: IOS Press.www.gesundheitsforschungbmbf.de/MTStudieII_ Anhang_III.pdf. Accessed on the 12th of December 2009.

Arhin-Tenkorang D. Mobilizing Resources for health: The Case for Users Revisited CID Working Paper 2001; NO. 81

Jarret SW, Ofosu-Amaah S. Strengthening health services for MCH in Africa: the first four years of the 'Bamako Initiative'. Health Policy Plan 1992; 7: 16476.

Gilson L, McIntyre D. Removing user fees for primary care in Africa: the need for careful action. BMJ 2005; 331: 76265.

Gottret P, Schieber G. Health financing revisited: a practitioner's guide. Washington DC: World Bank www.siteresources.worldbank.org/INTHSD/Health- Financing/HFRFull.pdf. Accessed on the 3rd of January 2010.

Senah K. Maternal Mortality in Ghana: The other side; Research Review N S 2003; 19 (1) 47-55.

Bitran R, Giedion U. Waivers and exemptions for health services in developing countries: World Bank www.siteresources.worldbank.org/SOCIALPROTECT I0N/SP/0308.pdf. Accessed on the 4th of January 2010

Beattie A, Doharty J, Gilson L, Lambo E, Shaw P. Sustainable Health Care Financing in Southern Africa: Economic Development Institute, World Bank. www.catalogue.nla.gov.au/Record/2006426. Accessed on the 5th of December 2009.

Guy C, Martinus D, Robert B. Social health insurance development in low-income developing countries: new roles for Government and Non-profit health insurance organisations with reference to selected experiences from Africa and Asia. www.ilo.org/gimi/concertation/resource.do?page=/co ncertation/Accessed on the 5th of January 2010.

Xu K, Evans DB, Kadama P, Nabyonga J, Ogwal PO, Nabukhonzo P, Aguilar AM. Understanding the impact of eliminating user fees: utilisation and catastrophic health expenditures in Uganda: Social Science and Medicine 2006; 62: 866876.

Arhin-Tenkorang DC. Health Insurance in Rural Africa, Lancet 1995; 345: 44-45.

James C, Morris SS, Keith R, Taylor A. Impact on child mortality of removing user fees: simulation model. BMJ 2005; 331: 74749.

Criel B, Kegels G. A health insurance scheme for the hospital care in Bwamanda District, Zaire: lessons and questions after 10 years of functioning. Tropical Medicine and International Health1997; 2: 65472.

Dave P. Community and self-financing in voluntary health programmes in India. Health Policy and Planning1991; 6: 2031.

Arhin-Tenkorang D. Mobilizing resources for health: the case for user fees revisited, World Health Organization: Commission on Macroeconomics and Health Working Paper Series 2000 Paper No.WG3:6

Vogel T. User Fees in Health Argument in the Current Debate: A brief Stocktaking Paper. Social Development Division's Health Desk. www.sdc health.ch/health/health.health/user_fees_in_health- _arguments_in_the_current_debate_. Accessed on the 4th of January 2010

Jones AM. Health econometrics. In: Culyer AJ, Newhouse JP (eds). Handbook of health economics. Amsterdam: Elsevier 2000; 265

Diop F, Yazbeck A, Bitran R. The impact of alternative cost recovery schemes on access and equity in Niger. Health Policy And Planning 1995; 10: 22340

Full Text: PDF


  • There are currently no refbacks.

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

ISSN: 1597-4292