Mission Possible: Reaching the Unreachables - How can we expand health insurance coverage in Indonesia?

By: Nirmala Trisna

*This article was sent on May 30, 2006 to the Essay Competition of Global Health Forum Meeting 2006.

Introduction
More than 80% of Indonesians are uninsured (Ministry of Health Government of Indonesia – MoH GoI, 2004). They are people in informal sector and working poor, who cannot afford commercial insurance, yet are not poor enough to be eligible for safety net scheme. Being uninsured tend to give higher risk of illness than being insured, due to delayed health care or denial of care at health providers (Caulford & Vali, 2006; Stevens et al, 2006)). It may lead to family impoverishment as financial burden of catastrophic illness gets larger. The condition contributes to increasing numbers of impoverished households in Indonesia (MoH GoI, 2005).

Government of Indonesia (GoI) has set goals of Healthy Indonesia. One of its indicator is universal coverage; 80% of health insurance coverage by 2010 (MoH GoI, 2003). Since early 1990s, district governments have developed community-based health financing schemes as it can promote pooling for informal sector workers (WHO, 2000). However, the policy is ineffective to achieve universal coverage in Indonesia due to voluntary participation and limited contribution. In 2004, GoI, with the spirits of health sector reform and decentralized policy, launched social security system (Law No. 40/2004) to expand health insurance coverage.

Four decades of efforts to expand insurance coverage, GoI has not yet reached the unreachables: the working poor in informal sector. They remain uninsured and vulnerable to impoverishment. This paper aims to provide ideas to reach them and expand health insurance coverage in Indonesia. It is preceded by description of public policy of GoI on health insurance, particularly in Bali province, to increase coverage. Barriers of universal coverage are identified in order to recommend best possible ways to expand participation of health insurance.

Public policy on health insurance in Indonesia
Up to 2006, 20 percent of Indonesian people are insured. They are government employees and retirees, workers in formal sector, economically advantaged families and families under national poverty line. GoI aimed to expand insurance coverage by constituting health law in 1992, which has encouraged district governments to develop their community-based health financing (Malik, 2002). In late 1990s, after economic crisis, safety net was established for families with income under national poverty line. It includes comprehensive benefits in government hospitals. However, due to improper marketing efforts and poverty identification, many poor families cannot access the programs. Stakeholders analysis and marketing planning were not conducted prior to the program (Muliaddin et al, 2005; Pratomo, 2003; Irwan, 2005)

In 2004, GoI move forward to achieve universal coverage. A national law on social insurance, included health insurance, was constituted. The law indeed requires compulsory participation of all residents in Indonesia (Chapter 2, article 4g), yet it only explains mechanism for workers in formal sector and poor families. The informal sector workers, which is 65% of working population in Indonesia, may participate voluntarily. By this law, the working poor in informal sector tends to be remain uninsured, has to pay large sums of medical expenditures and be impoverished.

Case study in Bali province. It took more a decade for districts in Bali to respond the health law. Up to 2006, only two districts (kabupaten) issued policies on health insurance. They are Jembrana and Tabanan, each with different schemes.

Jembrana initiated Jaminan Kesehatan Jembrana (JKJ), the first social health insurance scheme in Bali. JKJ covers primary health services where beneficiaries can choose between public and private providers. It is administered by district health office and fully funded by district income. Despite its design as social insurance, study found JKJ coverage is only 44%. It is caused by complicated registration procedures and ineffective social marketing. The program is not equitable as the economically disadvantaged, particularly those who live in rural areas, are not affected by JKJ. They either do not know JKJ or found difficulties to register (Trisna & Muninjaya, 2005).

On the other hand, Tabanan chosen to contract PT. Askes, corporation that administers nation-wide insurance for government employees, to provide affordable health insurance, namely Askes Mandiri. District health office supported the marketing and residents voluntarily register. Beneficiaries pay monthly premium to community leaders to be eligible for comprehensive care in government providers. Up to 2006, only 40% Tabanan residents are covered by health insurance. Due to its voluntary participation, Askes Mandiri attracts high-risk population. District hospital has complained on low reimbursement tarrifs. Community leaders faced difficulties to collect premium.

Barriers to universal coverage of health insurance in Indonesia
Current policy in Indonesia does not likely result in universal coverage of health insurance by 2010. Largest population who is uninsured is the working poor in informal sector. There are several barriers that hinder the mission of universal coverage, identified as financial, system and psychological.

Financial barrier. Irregular income and competing allocation of resources are financial problems that are faced by the working poor. They can hardly pay insurance premium, particularly if it must be paid annually. Study found they are willing to pay small amount of monetary contribution, particularly if health condition is perceived good (Murti, 2005).

System barriers. Regulations rarely address how to reach informal workers. The nonexistence of resident’s single-identification-number and low participation in income taxation system create difficulties to generate participations and contributions. There are no systems that endorses compulsory health insurance, e.g. school entry, application and renewal of driver license/national identification card. Moreover, current systems do not allow complaints, either from beneficiaries, providers or other stakeholders. Grievance remains vague, unsatisfactory stakeholders spoil the market and the uninsured remains unreached. Systems get worsened by limited local leadership, inadequate human resources at district health offices and government providers (Bagyono, 2001; Amelia & Mukti, 2004).

Psychological barriers. A vital and remain unsolved barrier of insurance in Indonesia lies deep inside the mind. The working poor in informal sector, mostly not well-educated, do not fully understand health insurance. They have not yet bought in the concept of advance payment for intangible products. Making it worse, buzz from unsatisfied Askes beneficiaries discourages insurance coverage expansion. Unfortunately, health providers as community’s educator, do not have sufficient knowledge on insurance. Many medical schools in Indonesia have not yet included health insurance in their curriculums.

Possible solution to reach universal coverage
There are several items need to be addressed to reach the uninsured and expand health insurance coverage to achieve universal coverage in Indonesia.

District social health insurance. Administration should be at regional levels, either district or province; depends on population and geographical characteristics. The national law on district governments (Law No. 32/2004) supports decentralized health insurance scheme. Decentralization allows local-customized national health insurance system to target population with distinctive geographical, social and economic characteristics.

Premium-savings account. Community participation is required to sustain social health insurance. Yet, knowing the fact of lacking financial resources, community should be empowered to arrange premium-savings account. Government subsidy starts after certain amount of savings. This mechanism will alter financial barrier and expand health insurance coverage.

Cross-sectoral support.
(1) Civil registry system. Universal coverage will not work without cross-sectoral support. Civil registry should be available to identify population based on socio-economic-status. Clustering the population is more likely to ensure financial equity of social health insurance.
(2) Premium-collection network. Contribution compliance can be assured by establishing premium-collection network. In Indonesia, the most common utilities is electricity, regardless of socio-economic status. Thus, premium payment attached to monthly electricity bill is the best possible solution to expand coverage and ensure compulsory payment compliance.
(3) Entry-system requirements. Universal coverage of health insurance can be empowered by establishing entry-system requirements. For instance, applicants of driver license or resident card or new students, should show proof of insurance.
(4) Education. Dissemination of social health insurance policy will be effective if all stakeholders are well-educated. Health insurance concepts should be incorporated in medical and public health curriculum. In addition, health insurance players should be educated to manage effective social marketing. Over time, satisfaction level of beneficiaries and providers can be elevated, thus participation rate will be improved.

Good corporate governance. Pyschological barrier is not easy to be altered in short term. However, good corporate governance is key of fixing bad rapport among health insurance administrator, provider, beneficiaries and health authorities. A board of trustee should be established as interest-pooling, which can take great role in grievance settlement and policy auditor to ensure responsive, transparent, accountable and equitable health insurance system.

Closing
Mission of GoI to achieve universal coverage by 2010 is not likely to be achieved under current system. Large population of working poor in informal sector is uninsured, as they face barriers to access health insurance scheme that have not yet addressed by current regulations. However, reaching these uninsured population is not impossible. Financial barrier can be dealt by premium-savings account. System barrier can be elevated by adequate civil registry, premium-collection network, entry-system requirements, and educating health providers. More importantly, good corporate governance is key of effective health policy, which can alter psychological barrier of insurance participation. Political will of GoI and leadership of district governments are crucial to arrange cross-sectoral support and move toward universal coverage of health insurance in Indonesia.