GFO Issue 466, Article Number: 4
ABSTRACT
This article highlights Nigeria’s biggest health reform yet, moving away from depending on foreign aid to paying for health with its own money. The plan, launched at the National Health Financing Dialogue, makes health insurance compulsory for federal workers, adds new taxes on tobacco, alcohol, and sugary drinks, and looks to diaspora funding. Health Minister Muhammad Ali Pate wants 44 million Nigerians insured by 2030. Finance Minister Wale Edun linked economic changes to better healthcare. Lawmakers also promised more funds and community involvement. If followed through, this plan could change Nigeria’s health system and inspire other African countries.
Nigeria has launched what officials are calling the most ambitious health financing reform in its history. To address declining global health aid, the government is focusing on domestic resource mobilization, mandatory insurance, and economic reforms to achieve Universal Health Coverage (UHC) for 220 million citizens. A new health financing plan was revealed at a four-day summit, themed “Reimagining the Future of Health Financing in Nigeria,” featuring top health leaders, governors, lawmakers, and international partners. Among them: Coordinating Minister of Health and Social Welfare Professor Muhammad Ali Pate, Finance Minister and Coordinating Minister for the Economy Wale Edun, Senate Health Committee Chair Dr. Ipalibo Harry Banigo, and African Union Special Envoy on COVID-19 Dr. Donald Kaberuka, a former president of the African Development Bank.
Figure 1: Panelist discussing emerging challenges in health financing
From left to right: Dr. Donald Kaberuka Bayu, African Union Special Envoy on COVID-19, Professor Muhammad Ali Pate, Coordinating Minister of Health and Social Welfare, Dr. Ipalibo Harry Banigo, Senate Health Committee Chair, and Prof Mohamed Yakub Janabi, WHO Regional Director for Africa.
A turning point: From donor dependence to self-reliance
The meeting opened with an honest look at Nigeria’s place in the shifting global health landscape. Professor Pate described the last quarter-century as the “golden era of global health and global financing,” marked by the creation of transformative institutions like The Global Fund and Gavi. But he warned that era is ending.
“The changes in the last eight months are a wake-up call and an opportunity to face the reality that we cannot hope to build a healthy society for our people on the back of somebody else’s money,” he told the audience.
The World Health Organization also reflected that same theme of ownership. Dr. Mohamed Yakub Janabi, WHO Regional Director for Africa, cautioned that the most impoverished individuals are frequently the ones most affected when donor assistance diminishes. “Do we really own WHO when our assessed contribution is less than 20 percent?” he inquired. “The only way we can reach the most vulnerable is by countries taking ownership of their health.” He indicated Nigeria’s strategy for 120,000 community health workers as a potentially transformative move.
That reality, Pate said, underpins President Bola Ahmed Tinubu’s decision to make health insurance mandatory for all federal government employees. The presidential directive will instantly enroll millions of workers across Ministries, Departments, and Agencies into the National Health Insurance Authority (NHIA). Officials say this move could create one of the continent’s largest single health risk pools and reshape the Nigerian healthcare market.
Pate laid out an ambitious target:
“Our goal is to get at least 44 million Nigerians covered with health insurance by 2030 which will make Nigeria to have the largest pool of health insurance people in this continent and will be noticed and will change the dynamics of our healthcare market.”
He also urged Nigeria’s private sector to get on board:
“It is in the interest of the private sector to recognize that a financially protected employee is a secure employee, and a satisfied employee contributes positively to business. This creates a beneficial cycle.”
Health policy meets economic reform
Finance Minister Wale Edun made it clear that the new health agenda is inseparable from Nigeria’s broader economic strategy. After years of fiscal strain, the government says it has begun to stabilize the economy. Edun pointed to progress: the fiscal deficit has “shrunk from 5.4% of GDP to 3% of GDP,” while revenues are climbing to “more than 11%” of GDP — levels not seen in many years.
He drew a direct link between macroeconomic policy and healthcare delivery:
“Macroeconomic stability is also a health policy by other means, but it only counts if it changes the experience at the primary health care center.”
Edun defended the controversial removal of fuel subsidies, arguing that it has “restored fiscal balance” and doubled the funds available to states. That extra fiscal space, he said, will allow states to better co-finance healthcare initiatives.
Iron rules of finance
Transparency and accountability were recurring themes. Dr. Donald Kaberuka, speaking from his deep experience in international finance, outlined six “iron rules” for sound health financing:
- Progressive taxation: “From each one according to their means,” he said, pointing out Nigeria’s tax-to-GDP ratio lags behind sub-Saharan Africa’s average.
- Responsible borrowing: “Bearing in mind our capacity to service the debt.”
- The Four A’s of service delivery: “Availability of services, Accessibility to them, Affordability without wasteful subsidies, and Accountability for all resources.”
- Protecting the vulnerable: “Any system which does not provide for the weakest in society will not be sustainable.”
- Pooling risks through schemes like the NHIS.
- Fiscal prudence: “Saving for a rainy day.”
“If you get this right, I think we need less and less foreign aid,” Kaberuka concluded, drawing nods from the audience.
New tools: From sugar taxes to diaspora bonds
The reforms are not just about mandatory insurance. The government is bringing in new ways to raise money for health:
- Extra taxes on tobacco, alcohol, and sugary drinks to bring in cash and also discourage unhealthy habits.
- Taking money directly from federal funds to make sure states pay their share into the Basic Health Care Provision Fund (BHCPF).
- Tapping into diaspora remittances through a new Diaspora Health Hub, which will help channel money into structured insurance plans.
- Adding more safety nets, like a Catastrophic Health Insurance Fund in the 2025 budget to pay for very expensive treatments such as cancer, kidney disease, and spinal surgery.
Prof. Pate said these measures will not only raise funds but also help fight Nigeria’s rising problem of non-communicable diseases.
States, legislators, and communities step up
Lawmakers are already supporting the reforms. Senator Ipalibo Harry-Banigo said she is introducing a bill to increase BHCPF funding from 1% to 2% of the Consolidated Revenue Fund and to create a special account for immunization. She also suggested an annual “learning agenda” where state commissioners, local leaders, and lawmakers can share what works best.
“This enables collaboration and coordination of activities across health to improve health outcomes because everyone is interested,” she said.
Banigo also wowed the crowd with a personal promise:
“I have allocated my constituency allowance to enroll over 6,000 vulnerable constituents… I intend to go on for as long as I am a senator.”
But she reminded everyone that communities must be involved:
“They can actually take ownership of it because they are participating in it... Can you imagine a health center that has no light? Which patient or client would like to attend that kind of health center?”
From sick care to health creation
While money was the main topic, participants agreed that funding alone isn’t enough. Prof. Pate warned against focusing too much on expensive treatments:
“We cannot dialyze our way out of an upsurge of hypertension and diabetes.”
Instead, he advocated for a "health in all" strategy — indicating that health ought to be included in policies regarding water, sanitation, nutrition, education, and preparedness for pandemics. He also advocated for a One Health strategy, connecting human, animal, and environmental health to prevent future pandemics before they expand.
A risky bet on political determination
The Abuja dialogue ended with hope but also a clear sense of the challenges ahead. Nigeria’s plan depends on mandatory insurance for formal workers, new protection for the poor and informal workers, more domestic revenue, and strict accountability.
It's a daring risk, requiring political leaders at every level to remain dedicated. If successful, Nigeria might transform its healthcare system and demonstrate a model for African independence in global health.
Nigeria has launched what officials are calling the most ambitious health financing reform in its history. To address declining global health aid, the government is focusing on domestic resource mobilization, mandatory insurance, and economic reforms to achieve Universal Health Coverage (UHC) for 220 million citizens. A new health financing plan was revealed at a four-day summit, themed “Reimagining the Future of Health Financing in Nigeria,” featuring top health leaders, governors, lawmakers, and international partners. Among them: Coordinating Minister of Health and Social Welfare Professor Muhammad Ali Pate, Finance Minister and Coordinating Minister for the Economy Wale Edun, Senate Health Committee Chair Dr. Ipalibo Harry Banigo, and African Union Special Envoy on COVID-19 Dr. Donald Kaberuka, a former president of the African Development Bank.
Figure 1: Panelist discussing emerging challenges in health financing
From left to right: Dr. Donald Kaberuka Bayu, African Union Special Envoy on COVID-19, Professor Muhammad Ali Pate, Coordinating Minister of Health and Social Welfare, Dr. Ipalibo Harry Banigo, Senate Health Committee Chair, and Prof Mohamed Yakub Janabi, WHO Regional Director for Africa.
A turning point: From donor dependence to self-reliance
The meeting opened with an honest look at Nigeria’s place in the shifting global health landscape. Professor Pate described the last quarter-century as the “golden era of global health and global financing,” marked by the creation of transformative institutions like The Global Fund and Gavi. But he warned that era is ending.
“The changes in the last eight months are a wake-up call and an opportunity to face the reality that we cannot hope to build a healthy society for our people on the back of somebody else’s money,” he told the audience.
The World Health Organization also reflected that same theme of ownership. Dr. Mohamed Yakub Janabi, WHO Regional Director for Africa, cautioned that the most impoverished individuals are frequently the ones most affected when donor assistance diminishes. “Do we really own WHO when our assessed contribution is less than 20 percent?” he inquired. “The only way we can reach the most vulnerable is by countries taking ownership of their health.” He indicated Nigeria’s strategy for 120,000 community health workers as a potentially transformative move.
That reality, Pate said, underpins President Bola Ahmed Tinubu’s decision to make health insurance mandatory for all federal government employees. The presidential directive will instantly enroll millions of workers across Ministries, Departments, and Agencies into the National Health Insurance Authority (NHIA). Officials say this move could create one of the continent’s largest single health risk pools and reshape the Nigerian healthcare market.
Pate laid out an ambitious target:
“Our goal is to get at least 44 million Nigerians covered with health insurance by 2030 which will make Nigeria to have the largest pool of health insurance people in this continent and will be noticed and will change the dynamics of our healthcare market.”
He also urged Nigeria’s private sector to get on board:
“It is in the interest of the private sector to recognize that a financially protected employee is a secure employee, and a satisfied employee contributes positively to business. This creates a beneficial cycle.”
Health policy meets economic reform
Finance Minister Wale Edun made it clear that the new health agenda is inseparable from Nigeria’s broader economic strategy. After years of fiscal strain, the government says it has begun to stabilize the economy. Edun pointed to progress: the fiscal deficit has “shrunk from 5.4% of GDP to 3% of GDP,” while revenues are climbing to “more than 11%” of GDP — levels not seen in many years.
He drew a direct link between macroeconomic policy and healthcare delivery:
“Macroeconomic stability is also a health policy by other means, but it only counts if it changes the experience at the primary health care center.”
Edun defended the controversial removal of fuel subsidies, arguing that it has “restored fiscal balance” and doubled the funds available to states. That extra fiscal space, he said, will allow states to better co-finance healthcare initiatives.
Iron rules of finance
Transparency and accountability were recurring themes. Dr. Donald Kaberuka, speaking from his deep experience in international finance, outlined six “iron rules” for sound health financing:
- Progressive taxation: “From each one according to their means,” he said, pointing out Nigeria’s tax-to-GDP ratio lags behind sub-Saharan Africa’s average.
- Responsible borrowing: “Bearing in mind our capacity to service the debt.”
- The Four A’s of service delivery: “Availability of services, Accessibility to them, Affordability without wasteful subsidies, and Accountability for all resources.”
- Protecting the vulnerable: “Any system which does not provide for the weakest in society will not be sustainable.”
- Pooling risks through schemes like the NHIS.
- Fiscal prudence: “Saving for a rainy day.”
“If you get this right, I think we need less and less foreign aid,” Kaberuka concluded, drawing nods from the audience.
New tools: From sugar taxes to diaspora bonds
The reforms are not just about mandatory insurance. The government is bringing in new ways to raise money for health:
- Extra taxes on tobacco, alcohol, and sugary drinks to bring in cash and also discourage unhealthy habits.
- Taking money directly from federal funds to make sure states pay their share into the Basic Health Care Provision Fund (BHCPF).
- Tapping into diaspora remittances through a new Diaspora Health Hub, which will help channel money into structured insurance plans.
- Adding more safety nets, like a Catastrophic Health Insurance Fund in the 2025 budget to pay for very expensive treatments such as cancer, kidney disease, and spinal surgery.
Prof. Pate said these measures will not only raise funds but also help fight Nigeria’s rising problem of non-communicable diseases.
States, legislators, and communities step up
Lawmakers are already supporting the reforms. Senator Ipalibo Harry-Banigo said she is introducing a bill to increase BHCPF funding from 1% to 2% of the Consolidated Revenue Fund and to create a special account for immunization. She also suggested an annual “learning agenda” where state commissioners, local leaders, and lawmakers can share what works best.
“This enables collaboration and coordination of activities across health to improve health outcomes because everyone is interested,” she said.
Banigo also wowed the crowd with a personal promise:
“I have allocated my constituency allowance to enroll over 6,000 vulnerable constituents… I intend to go on for as long as I am a senator.”
But she reminded everyone that communities must be involved:
“They can actually take ownership of it because they are participating in it... Can you imagine a health center that has no light? Which patient or client would like to attend that kind of health center?”
From sick care to health creation
While money was the main topic, participants agreed that funding alone isn’t enough. Prof. Pate warned against focusing too much on expensive treatments:
“We cannot dialyze our way out of an upsurge of hypertension and diabetes.”
Instead, he advocated for a "health in all" strategy — indicating that health ought to be included in policies regarding water, sanitation, nutrition, education, and preparedness for pandemics. He also advocated for a One Health strategy, connecting human, animal, and environmental health to prevent future pandemics before they expand.
A risky bet on political determination
The Abuja dialogue ended with hope but also a clear sense of the challenges ahead. Nigeria’s plan depends on mandatory insurance for formal workers, new protection for the poor and informal workers, more domestic revenue, and strict accountability.
It's a daring risk, requiring political leaders at every level to remain dedicated. If successful, Nigeria might transform its healthcare system and demonstrate a model for African independence in global health.
