Determinants of demand for health insurance in Uganda

Abstract

Although health insurance is not new in Uganda, the proportion of the population that utilises it, is at a meager 5 percent, with willingness to pay for health insurance standing at only 11 percent. In the absence of a national health insurance scheme, health sector financing is largely not pre-paid. Therefore, it is against this background that the study examined the determinants of demand for health insurance in Uganda. The study applied a logit model to secondary data from the UNHS 2016/17 conducted by UBOS and the results reveal that awareness about health insurance, age of an individual, one’s marital status, the education level, area of residence, wealth and the size of a household are significantly associated with demand (utilisation) for health insurance, whereas awareness, marital status, health status, education level, area of residence, size of a household, wealth, the region of residence, as well as suffering from a non-communicable disease are significantly associated with an individual’s willingness to pay for health insurance. Results further reveal that an individual’s gender (male or female), age as well as price (expenditure on medical and health care) are not significantly associated with willingness to pay for health insurance. Most Ugandans are not aware of health insurance as a mode of paying for medical care yet awareness proved as a very crucial factor in determining the demand for health insurance. Generally, the willingness to pay does not translate into actual utilisation of health insurance in Uganda. The study, therefore, recommends for promoting of awareness about health insurance, increasing the literacy levels of Ugandans through education, promoting poverty reduction and income enhancing programmes as well as urgently implementing a National Health Insurance Scheme (NHIS).