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African Health Markets for Equity (AHME) supports Ogun State to achieve universal health coverage

The Ogun State Government in Nigeria recently launched a voluntary community-based health insurance scheme, known as Araya.

  • Jun 11, 2014

Abeokuta, 29 April 2014 – The Governor of Ogun State, His Excellency Senator Ibikunle Amosun has created an annual budget line of 600 million Naira (USD 3.8 million) towards the initiation, roll out and implementation of the Araya scheme. The African Health Markets for Equity (AHME) partnership is supporting the Ogun State Government in the implementation of this pro-poor scheme. The PharmAccess Group is contributing expertise in the fields of demand-side financing, access to capital and quality improvement.

Governor Amosun, who described the start of Araya as a watershed moment on the road to universal health coverage for his citizens, emphasized the holistic approach of the program: “The widespread participation in community-based health insurance scheme across Ogun State will provide free healthcare for the most vulnerable group – pregnant mothers, children under five years and the aged (70 years and above) – while the cost of health care for the general populace will be partly subsidized by Government. It is our belief that this will serve as a reference point for others across the country.”
Governor Amosun - Ogun AHME launch Araya
Health in Nigeria
Achieving universal health coverage has been high on the agenda in Nigeria since 2005. Despite years of investing in the healthcare system, the result has been less than encouraging. The country has one of the highest infant mortality rates in the world and performs poorly in health care. The poor penetration and fragmentation of demand side financing (DSF) mechanisms within the country is reflected by the fact that Nigeria’s out-of-pocket payments are almost double the sub-Saharan African average. This leads to catastrophic healthcare payments and limited access to healthcare for the poor.

Araya scheme
The Araya scheme, though in its pilot phase, is expected to be made statewide over the next few years. AHME partner PharmAccess has already achieved this feat with a similar program in Kwara State. As the main technical assistance partners to the Ogun State Government on the Araya scheme, PharmAccess and IFC incorporated the lessons learned in Kwara in the development of the Araya Scheme.

Ogun is a state in southwestern Nigeria with an estimated 4 million inhabitants. Over 60% of its population lives on less than a dollar a day. Araya will bring quality health care within reach of the entire Ogun population. Through demand-side financing, the AHME consortium will ensure that the scheme especially benefits people in the bottom quintile (Q1). The health plan covers primary health care, chronic disease treatment, maternity care including C-sections, child care, dental care and surgeries. Both public and private healthcare providers will partake in the scheme. Improving the quality of the healthcare services at these facilities is a central aspect of the Araya scheme. Ogun State will support providers to engage in continuous quality improvement through the internationally accredited SafeCare standards. The Araya scheme will generate a steady stream of income for these public and private healthcare providers. Also, by reducing out-of-pocket payments, it will contribute to increased financial protection for the poor.

According to Dr. Olaokun Soyinka, the Honorable Commissioner for Health in Ogun State, the Araya scheme will bring affordable care to all residents in Ogun. “We have devised a program that will bring efficient healthcare within the reach of our people who are hit hard when they incur bills as a result of ill health, or who may not even be able to afford care at all,” he said. Extensive research went into the design of the scheme, including baseline health surveys, willingness-to-pay studies and actuarial analysis (conducted by PharmAccess). Soyinka is confident that the general population would be willing to pay N4,000 (USD 25) per year for quality healthcare. Based on this insight, Ogun State drafted an annual premium of N7,000 (USD 44), of which the Government and its supporting partners subsidize N3,000 (USD 19). These installments make it possible to offer free access to health care for those groups who need it most. By working from a solid base of community ownership, Araya aims to create a sustainable risk sharing pool for beneficiaries of the scheme while providing health facilities with a regular income to invest in providing quality health care.

Catalytic sustainability
Community-based health insurance (CBHIS) is a relatively new health system intervention. Not only on a state and national policy level, but among the general population as well. The Araya scheme will serve as a pilot program to increase the scale and quality of public and private provider networks and demand-side financing in Ogun State. “Through the many programs that PharmAccess has initiated, we have learned that stimulating both supply and demand-side constraints is paramount in building functioning health systems,” says Ayodeji Ajiboye, Health Plans Program Director at PharmAccess Nigeria. “Subsidized health insurance brings quality health care within reach of people who would otherwise not be able to afford it. Also, by giving clinics the tools to improve their quality, we enable them to attract more patients and upgrade their businesses. This creates an upward spiral of diminishing risk and growing trust, paving the way for private investments.”

AHME has a specific Q1 enrollment strategy and is also stepping in to introduce the private sector. The two AHME social franchise providers active in Nigeria, Marie Stopes International and Society for Family Health, have committed to setting up franchise networks to make the community-based health insurance sustainable. As such, they contribute to private sector introduction. The State will ensure sustainability of the scheme by passing a CBHIS bill and embedding Araya in state legislation. In order to ensure that the intervention takes root within government and the populace, it is necessary to deploy frameworks and structures. Within their policy work, IFC will have a strong focus on scalability and the development and adoption of the CBHIS bill. In his goodwill message at the launch of the Araya scheme, Dr. Olumide Okunola, Senior Operations Officer of the IFC, said that six States had been considered for AHME support. Ogun State was selected because it met the yardsticks of transparency in the administration of health programs and setting up of a risk pool that will involve the poor. He congratulated the State with the success of the CBHIS launch.

As Governor Amosun said, “Our vision is for every citizen of the State, wherever he or she lives within the boundaries of our dear State, to have easy, fast and unfettered access to efficient healthcare delivery.” Ultimately, Araya aims to improve access to quality health care in one state while creating a catalytic effect for improving healthcare outcomes throughout the country.

Supporting partners
The Araya scheme was initiated with a strong and long-term commitment from Governor Amosun as well as his cabinet, who enlisted the support of several private and public international development partners. The African Health Markets for Equity (AHME) consortium has pledged significant support over a period of five years. Firstly, AHME will assist Ogun in bringing Araya within reach of the poor. Implementing a program for people in the bottom two quintiles requires a deliberate and targeted marketing and enrolment strategy. AHME will help Ogun and HMOs to develop and refine strategies that focus on Q1, Q2 and the informal sector. Secondly, AHME will oversee private sector involvement by ensuring that franchise and private healthcare providers are included in the scheme. Finally, AHME is providing technical assistance for costing pricing, administration, policy interventions for regularly framework support, benefit package design, marketing, quality and upgrading private providers.

Other Araya partners include World Health Organization (WHO), United Nations Children’s Fund (UNICEF), International Finance Corporation (IFC), Shell/SNEPCO, National Primary Health Care Development Agency (NPHCDA), UNFPA (UNH4) and the National Health Insurance Scheme (NHIS) Nigeria.


The African Health Markets for Equity (AHME) consortium is a five-year partnership led by Marie Stopes International and funded by the Bill & Melinda Gates Foundation and the UK’s Department for International Development (DFID). AHME strives to improve health outcomes for the poor by enhancing the quality of care in the private sector in Ghana, Nigeria and Kenya. AHME is implemented through a partnership between Marie Stopes International, Population Services International, Society for Family Health Nigeria, which focus on social franchising, Grameen Foundation, which focuses on IT development, International Finance Corporation (IFC), which works on policies, legislative and governance frameworks, and PharmAccess,Medical Credit Fund and SafeCare, which cover demand-side financing, access to capital and quality improvement.

SafeCare supports basic healthcare providers in resource-restricted settings to improve the quality of their services by working through a stepwise, structured quality improvement program. Medical Credit Fund aims to increase access to quality healthcare services for low-income Africans by facilitating loans and technical services for franchise and private providers. Both Medical Credit Fund and SafeCare are part of the PharmAccess Group.

PharmAccess has gained considerable experience in rolling out and developing a health plan similar to Araya in Kwara State, Nigeria. The Community Health Insurance Program has had such a profound impact on the poor people of this rural state that the Kwara State Government has pledged to scale it up to provide access to affordable quality health care for at least 60% of the population in Kwara by 2018. As such, this program has been referred to by many as a possible blueprint for achieving universal health coverage in Nigeria.

PharmAccess Communications: Charlotte Wagenaar,, +31 6 3499 5616
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