The successful implementation of these schemes will no doubt benefit people as they do not have to fret about losing income due to illness or other mishaps and could freely use financial resources to provide better education to their children and nutritious diets.[break]
Nepalis, many say, are thrifty by nature. Thriftiness may not always be bad. But in the case of Nepal, many hesitate to freely spend as they want to save it for a rainy day --especially to fund children’s higher education and foot hospital bills if family members fall sick. Although government-run educational institutions offer services at low prices, they do not offer quality. So people might have to continue saving money to send their children to better colleges and universities. But if the government introduces social insurance schemes and provides free healthcare services, many may be able to make greater use of their disposable income for other purposes.
Acknowledging this, the health ministry last August came up with the first draft policy on National Health Insurance.
The main objective of the policy, according to the draft, is to ensure universal health coverage by increasing access to necessary and quality health services, so that ‘out-of-pocket expenditure’ on healthcare goes down.
For this, the government intends to raise a certain premium amount from every household every year and provide healthcare services on cash-free basis. These services will be provided for free to those living below the poverty line.
Currently, the government is spending millions of rupees every year to provide free treatment against various diseases. Yet these subsidized programs have not been effective as they do not incorporate treatment for new diseases.
“This is increasing healthcare spending, which is pushing many families to the verge of poverty, while compelling members of poor families to remain incapacitated on their deathbeds,” the health ministry said.
The case is pretty similar among workers employed in both formal and informal sectors. These people, who work all their life, are forced to see their savings deplete if they land on a hospital bed or become temporarily unemployed. Because of these problems, they are forced to make compromises while leading a life they intend to live.
To deal with this problem, the government formally introduced the concept of social security in July 2010 which envisaged formation of a social security fund to develop social security schemes for workers based on the contribution they make.
Since then, the Social Security Fund (SSF) has been collecting a one percent social security tax from the non-taxable basic salaries of workers employed in the formal sector. Later, the SSF intends to make it mandatory for employees and employers to contribute 10 percent of the workers’ basic salary each to run social security programs. The SSF is also expecting contribution of another 10 percent of the basic salary of workers from the government for the purpose.
As per the Social Security Fund (Management and Operation) Regulation, the SSF is entrusted with the task of designing benefit packages for unemployment, workplace injury and accident, sickness, maternity, dependency, disability, old-age, medical and family.
So far, the SSF has already designed schemes on sickness benefits, maternity benefits and workplace injury and accidents, under which compensation of up to 70 percent of basic salary will be extended to employees if they remain absent from the workplace due to illness, pregnancy or from accidents that occur at their place of work. These schemes also pledge allowances to diagnose diseases and compensation to those who become partially or fully disabled due to accidents at workplace.
Although these schemes have not yet been approved by the government, they will definitely protect the interest of workers once rolled out.
“But to introduce the schemes, we need a Social Security Act,” Bishnu Rimal, president of the General Federation of Nepalese Trade Unions, who is also an SSF board member, told Republica.
“Since the promulgation of the Act is not possible (due to the absence of a parliament), we have proposed introduction of an ordinance to roll out social security programs.”
Trade unions are pushing for immediate implementation of social security schemes as their members are becoming disenchanted by the practice of keeping money collected from them idle in the government coffers.
The government, so far, has raised a fund of around Rs 3 billion from employees of the formal sector by slapping the one-percent tax on basic salaries.
“These people, who contribute money every month, are now questioning the purpose of raising the funds,” Rimal said, adding, “That’s why we need the ordinance as soon as possible.”
But even if the schemes are rolled out, there is chance of duplication as the health ministry is also planning to introduce universal health coverage schemes for the entire population of the country.
Although there are views that those who pay a premium should be allowed to take benefit from every scheme they are enrolled in, others say it would be a misuse of resources if such practice is encouraged.
“To tackle this problem, the government must introduce biometric smart cards, comprising unique identity numbers, that record the entire history of every citizen,” SSF Executive Director Kebal Prasad Bhandari told Republica.
The government has already set up the National ID Management Center to distribute biometric smart cards to all Nepalis. The Center has also started creating a database based on information provided by the Election Commission.
“Just recently, we also issued a global tender notice calling on domestic and international parties to participate in the bidding to supply a system -- both hardware and software -- to generate unique ID numbers for every citizen in the country,” Tulsi Prasad Gautam, the Center’s executive director, said. “If everything goes smoothly, we will be able to distribute sample cards within mid-April 2014.”
However, there are views that the National ID Management Center may take several years to incorporate the database of every citizen of the country, since it is currently gathering information from the Election Commission, which collects records of only those who are eligible to vote.
“Since the universal healthcare coverage schemes (to be introduced by the health ministry) also apply to children, we may not be able to take benefit from the Center’s system. For this, we might have to generate our own unique numbers,” Kabi Raj Khanal, an undersecretary at the health ministry, said.
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