The Reserve Bank of Malawi (RBM) plans to increase medical insurance penetration and ensure that service providers are regulated through the proposed Medical Aid Bill.
RBM director of pension and insurance supervision, Chimwemwe Kachingwe, in an interview last week said the registrar of financial institutions hopes to increase penetration for medical insurance scheme business through the proposed Medical Aid Bill.
She said if properly regulated, medical insurance schemes can improve the delivery of their services and increase consumer confidence and uptake of medical insurance.
Said Kachingwe: “As part of the bigger financial inclusion strategy, we have embarked on the development of the regulatory framework for inclusive insurance. We believe that the framework will create an enabling environment for existing and new inclusive insurance providers to reach out to the vast uninsured market.
“The registrar is looking at increasing insurance penetration for medical aid business. In this regard, the draft Medical Aid Bill was submitted to the Ministry of Finance, Economic Planning and Development.”
According to the central bank, the Bill has been developed alongside the regulatory framework for inclusive insurance to improve insurance penetration, which stands at paltry 1.4 percent.
But Medical Council of Malawi board chairperson Professor John Chisi said while increasing insurance penetration in the health sector is vital, developing and promoting line policies is also key to the success of the proposed Medical Aid Bill.
He said: “It is unfortunate that we do not have many people who can afford insurance in Malawi because of issues of employment. So, whenever they create these bills, they should also think of what would be the income of these people, so, it should go hand in hand with creating jobs so that people have liquidity and can go to these health facilities and pay for their insurance.
“At the moment, few people can access [medical insurance schemes] because of lack of sustainable income and employment.”
In an interview, Sydney Chikoti, chief executive officer of Medical Aid Society of Malawi (Masm), one of the country’s medical insurance service providers, said the regulation will help bring sanity in the industry.
Available statistics show that only three percent out of the 40 percent of health services provided by the private actors are purely commercial with the Christian Health Association of Malawi (Cham) providing 37 percent of the country’s healthcare.
Earlier, government hinted on introducing medical insurance scheme for civil servants, but that plan is yet to materialise. n