Are safety nets such as waivers and exemptions effective in tackling inequalities created by user-payment for health services? This article reports on exemption schemes in two districts of Uganda. It shows that poor and marginalised groups lack fair access to health care and not much has been done to address this. These safety nets will only be effective if they: are backed by national health financing policy; reconcile competing revenue demands of local government; and are strictly enforced and supervised by local and central governments.
The introduction of user-payment for health services is often followed by concerns about the impact on equity of access for poor people. Decentralising governments try to remedy the created inequalities by putting in place safety nets in the form of exemptions and waivers in user-fee systems. But local governments are often more interested in raising revenue to meet the costs of devolved services than in promoting equity For this study, data was collected in two administrative districts of Uganda (Mbarara and Mukono). Findings are consistent with the experience of other developing countries: exemption mechanisms face challenges in providing equitable access to health care for poor and marginalised groups.
- Individuals in communities expressed dissatisfaction with exemption schemes. Data suggests that exemptions are often granted to individuals on grounds other than the socioeconomic criteria.
- Districts were not comfortable with aspects of cost sharing that compromised the local governments’ goal of maximising revenue. Central government’s pursuit of equity in services, through exemptions and waivers, was seen as contradictory to this goal.
- There is a lack of formal national policy on cost sharing. Guidelines on safety nets are ignored, abused or selectively applied to suit the revenue aims of local governments and health units. The more a unit relies on cost sharing for its activities, the more inequitable service delivery becomes.
- Ugandan health workers are left with a dual challenge: working without adequate supplies and exempting ill individuals in need of assistance. In most cases, health workers opt for non-exemptions of indigent and other marginalised groups to keep units operating.
- Exemption schemes seem to have failed in Uganda. This is because they lacked adequate financing mechanisms such as direct central or local government subsidies for exemptions and waivers.
Three main lessons emerge in relation to developing countries implementing cost sharing and embedded safety nets:
- Safety nets without a sound national legislative base that are not properly supervised by central government are unlikely to protect the poor.
- Even district revenue collection goals are compromised if schemes are misused to exempt the richer among the poor at the cost of service quality improvement. User fee policies and embedded safety nets need to be formalised to ensure enforcement and monitoring in decentralised districts.
- Both central and local governments should explore other means of sustaining the operations of lower level health units that rely heavily on cost sharing. Central government can either patch up policy weaknesses, or seek alternative, equitable ways of delivering services.
