Financial protection coverage

The Tanzanian healthcare system primarily depends on funds from central level coming either from general tax revenues (29% of total health expenditures (THE) in 2014) or from external donors (36% of THE in 2014) (World Health Organization, 2014, Dutta, 2015). However, there are also user fees and insurance schemes in place to supplement these funds, leading to 35% of THE being funded by households (World Health Organization, 2014). The OOP expenditures as a percentage of THE were around 23% in the years 2012 to 2014, but with a slight upward trend in actual OOP spending per capita (World Health Organization, 2014). 1.7% of the population suffers from catastrophic health expenditures and 2.7% is pushed into poverty due to OOP payments (World health Organization and The World Bank, 2015b).

Overall, the health financing system is extremely fragmented, both within the central level funding system and in terms of health insurance schemes (McIntyre et al., 2008, Haazen, 2012, Borghi et al., 2013, Dutta, 2015). Table 5 provides an overview of the main health financing sources, which are part of the national health budget. However, there is also substantial and weakly aligned off-budget funding from additional partners and vertical programs (Ministry of Health and Social Welfare, 2015b). Consequently, these different funding streams make financial stewardship of the health sector challenging, which frequently leads to delays in fund disbursement (Ministry of Health and Social Welfare, 2013e, Dutta, 2015, Ministry of Health and Social Welfare, 2015b).

Table 5 Main health financing sources of the national health budget.

Central level

Local Government Block Grants

General tax revenues, divided in “Personal Emolument”

(salaries) and “Other Charges” (statutory employment benefits) (Frumence et al., 2014a)

Health Sector

Development Grants

Capital development grant primarily for infrastructure; contributions come from the central government and

development partners (Tidemand, 2013, Prime Minister’s Office Regional Administration and Local Government, 2014,

Tidemand et al., 2014) Local Government

Development Grants

Capital development grant primarily for infrastructure; contributions come from the central government and development partners (Prime Minister’s Office Regional Administration and Local Government, 2014, Tidemand et al., 2014)

Health Sector Basket Fund

Funds expenditures of recurrent nature; purely financed by development partners that pool un-earmarked resources (Frumence et al., 2014a, Tidemand et al., 2014)

Medical Store Department (MSD)

Receipt in-kind at health facility level; funds are disbursed from the central level to MSD to be put into the health facility account and then be spent on medical supplies (Euro Health Group, 2007)

Council level

Council Own Sources Locally at council level created revenues (e.g. local taxes) (Frumence et al., 2014a)

Insurance schemes

National Health Insurance Scheme (NHIF)

Compulsory insurance scheme for all public servants, which also includes their dependants. Covers both in-patient and out-

patient care with a spending limit (McIntyre et al., 2008). National Social Security

Fund/Social Health Insurance Benefit (NSSF-SHIB)

Compulsory insurance scheme for all private sector employees, that has a SHIB as part of the benefit package to which

members could voluntarily sign up to. Covers both in-patient and out-patient care (McIntyre et al., 2008, Haazen, 2012, Mills et al., 2012a)

Community Health Fund (CHF)

Voluntary insurance scheme for the informal rural population managed at council level. Covers a whole household. Annual premium and benefit package are defined by the council. Funds raised are doubled through “matching grants” from the central government via the NHIF (Haazen, 2012, Chakupewa and Maluka, 2016)

Tiba Kwa Kadi (TIKA) Voluntary insurance scheme for the informal urban or peri-urban population managed at council level. Covers an individual. Annual premium and benefit package are defined by the council. Funds raised are doubled through “matching grants” from the central government via the NHIF (Haazen, 2012)

Out-of-pocket

User fees User fees are levied at the point of access, whereas the poor and other definite priority groups (children under five, pregnant women, elderly above 60, and people with certain disease conditions, including chronic illnesses, HIV/AIDS, TB and leprosy) are exempted and supposed to receive free care at public health facilities without clear compensation mechanism for the cost incurred. The amount of user fee for each level of care is determined by the council (Mubyazi, 2004, McIntyre et al., 2008, Ministry of Health and Social Welfare, 2013e). Drug Revolving Fund Money obtained from selling medicines at hospital level

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As a consequence of the fragmented health insurance system, there is no cross-

subsidisation between the risk pools of the different insurance schemes (Ministry of Health and Social Welfare, 2015b). Also, individual schemes struggle to reach efficiency in scale due to low number of members (Ministry of Health and Social Welfare, 2015b). According to the National Health Insurance Fund (NHIF) database the overall health insurance coverage rate in 2013 was 19%. Yet, reliability of this number is questionable as the 2012 census only reported a coverage rate of 8.1% for Tanzania Mainland (National Bureau of Statistics and Office of Chief Government Statistician, 2014). For the Community Health Fund (CHF) enrolment rate in 2015 was around 4.5% based on the findings of the Demographic and Health Survey 2015/16 (Ministry of Health Community Development Gender Elderly and Children et al., 2016), indicating that the target of 30% coverage by 2015 had clearly not been reached (Ministry of Health and Social Welfare, 2009a, Ministry of Health and Social Welfare, 2015b). Chapter 8 will elaborate more on reasons for such low enrolment. The remaining uninsured population are often the people working in the informal sector and the very poor, who both depend on the public sector (Mills et al., 2012a, Dutta, 2015).

To address the problems in health financing the earlier mentioned HFS has been developed (Ministry of Health and Social Welfare, 2015b). Key elements of the HFS are [1] the

establishment of a single national health insurance, [2] the development of a standard minimum benefit package of healthcare services, and [3] the increase of domestic revenues for health financing through existing or new tax-funded sources as well as innovative

financing mechanisms (Ministry of Health and Social Welfare, 2015b). Therewith, the aim is to reach a health insurance enrolment rate of 50% by 2020 (Ministry of Health and Social Welfare, 2015b). Apart from the HFS, the HSSP IV also raises the need to improve Public Financial Management to guarantee efficient and effective flow and use of resources (Ministry of Health and Social Welfare, 2015b).