TWN Info Service on Health Issues (November 06/1)

2 November 2006

Mexico: Health insurance scheme that serves the poor

Mexico has created a health insurance scheme for the poor which will prevent those who are sick from getting more sick or becoming impoverished.

This article is reproduced with permission from the South-North Development Monitor (SUNS) # 6123, 19 October 2006. 

With best wishes
Evelyne Hong

Health: World looks at a Mexican revolution

By Sanjay Suri, IPS, London, 17 October 2006

The poor who fall sick may no longer be more sick, or the poorer for it. A Mexican model is at hand to lift them out of medical troubles.

The Seguro Popular, as the health scheme is called, has already met with extraordinary success in Mexico.

"It's working very well," Mexico's minister for health Julio Frenk told IPS in an interview here. "By the end of this year there will be 22 million people enrolled in the insurance scheme who prior to this programme were completely unprotected, [and] who would lapse into poverty if they had one episode of illness."

The Seguro Popular is a simple insurance scheme where poor families pay a small means-tested premium to cover them for health care. The government also pays for everyone who registers, increasing benefits that can be claimed on the small premium.

"What we have done in Mexico is to create a system where people enroll, and then money follows people," Frenk said. "That is to say, that for every person who enrolls there is an allocation from the government, along with a premium paid by the family which is means tested, so that the poorest families don't have to pay anything."

The government pays from the taxes it collects, so that money too comes from the people, Frenk said.

"This is a solidarity-based scheme between people who are healthy, and help finance health care, and people who are sick. One time or other we will all be sick. This is a very firm mechanism to finance health care because it doesn't leave the sick on their own. It creates a mechanism where we help each other at our time of greatest need."

The scheme is drawing attention from several countries. "We have had a number of delegations from many developing countries such as China, Turkey and South Africa," Frenk said.

Delegates from 45 countries attended a conference on the scheme in Mexico earlier this month, he said. The conference was organized jointly with The Lancet, the leading medical journal.

The scheme has proved a boon to the poor in Mexico. About 50 million Mexicans, half the population, had no medical cover before introduction of this scheme.

"Furthermore, we have found that this is quite a widespread problem around the world, a large proportion of poor people are becoming impoverished because of health expenditures," Frenk said.

"What we did was to create an insurance programme for those people who work on their own, who don't have employment-related insurance, and who tend to be the poorest."

Some of the families devastated by illnesses earlier were just above the poverty line, but with the health expenditures, they collapsed into poverty, Frenk said. The scheme covers 249 kinds of medical interventions, which are 90% of the demand.

The Mexican model can well be replicated elsewhere, said Frenk, who is the main architect of the reforms, and is also standing as a candidate for the post of World Health Organisation director-general.

"I have studied health systems throughout the world, including very poor countries, and this is a very powerful way of protecting very poor people. What this insurance mechanism does is that it empowers people, it makes their entitlements explicit."

In many developing countries, he said, government expenditure is not enough to meet all the growing needs of the people.

"Most developing countries are facing a double burden of disease. They still have the old problems like maternal deaths and malnutrition but they are also facing conditions common in developed countries like diabetes, heart disease, cancer, mental problems. Our systems are simply underfunded to cope with this double burden of disease."

The Mexican health reform programme, implemented by a change of law in 2003 to provide for it, is on target to provide health for all citizens by 2010, Frenk said. Enrollment under the scheme covers at present an additional 14% of the population every year.

To back the scheme, 1,700 new clinics and hospitals have been built around the country, including some specialty hospitals. Prior to the scheme, only salaried workers had access to a government-financed health protection scheme, while 4% of the population has private health cover.