Ending the burden of out-of-pocket healthcare

In today’s Nigeria, falling ill is no longer just a health crisis; it is a financial catastrophe waiting to happen. For millions of citizens, a hospital visit can wipe out savings, derail livelihoods, and plunge entire families into debt. At a time of economic hardship, rising inflation, and shrinking incomes, the persistence of out-of-pocket medical payments has become one of the most urgent social challenges confronting the nation.

Stories like that of Beatrice Eze are painfully common. Faced with a N500,000 cataract surgery bill, she had to liquidate her small business and rely on loans just to preserve her sight. In Abuja, a young security guard, Dennis Nanzem, delayed essential diagnostic tests because he could not afford them, only to collapse later from severe illness. These are not isolated cases; they are emblematic of a system where access to healthcare depends less on need and more on the ability to pay.

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The data is equally troubling. Health inflation has surged dramatically, reflecting the rising cost of drugs, diagnostics, and procedures. Meanwhile, health insurance coverage remains below 10 per cent of the population, leaving over 200 million Nigerians exposed to catastrophic health spending. Despite the promise of the National Health Insurance Authority Act, which made insurance mandatory and sought to expand coverage, progress has been painfully slow.

The consequences are clear. Nigeria is witnessing the emergence of what experts describe as the ‘health-poor’, individuals who may earn an income but are driven into poverty by medical bills. When a caesarean section costs up to N500,000 in public hospitals and over N1 million in private facilities, or when malaria treatment prices more than double within a few years, healthcare becomes a luxury rather than a basic right.

This crisis is not insurmountable. Nigeria already has the legal and institutional framework needed to reverse the trend. What is required now is decisive action, sustained political will, and a deliberate focus on implementation.

Basically, enforcement of mandatory health insurance must move from talks to reality. The law is clear, but compliance remains weak, particularly among employers and within the informal sector. The government must take bold steps to integrate health insurance into everyday economic life. Linking insurance enrollment to access to essential services (such as business registration, banking, or even certain government benefits) may be controversial, but it is a necessary push toward universality.

“This crisis is not insurmountable. Nigeria already has the legal and institutional framework needed to reverse the trend. What is required now is decisive action, sustained political will, and a deliberate focus on implementation.”

Also, affordability must be addressed head-on. For millions of Nigerians, especially those in the informal sector, the challenge is not unwillingness but inability to pay premiums. This is where targeted subsidies become critical. The government must significantly expand funding for vulnerable groups through mechanisms like the Basic Health Care Provision Fund. If properly financed and transparently managed, such interventions can bring tens of millions into the insurance net and reduce the burden of direct payments.

Likewise, technology should be fully leveraged to drive enrollment and efficiency. Digital platforms can simplify registration, premium collection, and claims processing, making the system more accessible and trustworthy. Mobile-based payment systems, for instance, can allow traders, artisans, and freelancers to contribute in small, flexible amounts that reflect their income realities. Trust, which remains a major barrier, can also be rebuilt through transparency enabled by technology.

Similarly, Nigeria must address the structural inefficiencies within its healthcare financing system. Fragmented risk pools, outdated tariffs, and delayed reimbursements discourage provider participation and undermine service quality. A more unified and well-regulated system will not only improve efficiency but also make health insurance more attractive to both providers and enrollees.

Equally, state governments must play a more active role. Health is a concurrent responsibility, yet implementation of insurance schemes varies widely across states. Expanding state-level adoption and ensuring alignment with national objectives will be key to achieving meaningful coverage. The experience of nations like Indonesia and Ghana demonstrates that subnational commitment is essential for success.

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Also important is public awareness. Many Nigerians remain sceptical of health insurance, shaped by years of institutional failure and broken trust. A sustained public education campaign is needed to highlight the benefits of insurance, dispel misconceptions, and encourage enrolment. People must see health insurance not as an abstract policy but as a practical tool for financial protection.

Ultimately, the goal is clear – no Nigerian should have to choose between healthcare and survival. No family should be pushed into poverty because a loved one fell ill. Achieving this will require more than policy declarations; it demands coordinated action across government, private sector stakeholders, and civil society.

The economic crisis Nigeria faces today only amplifies the urgency of reform. As household incomes are squeezed, the risks associated with out-of-pocket healthcare become even more severe. This is precisely the moment to strengthen financial protection mechanisms, not delay them.