What a National Medical Benefit Fund Would Actually Look Like for Namibia
By Willem Kanyondi
The National Medical Benefit Fund has been law since 1994 and unbuilt ever since. The coverage gap it was meant to close has barely moved in twenty years. Whether it finally arrives — or follows the SA NHI into stalemate — depends on design choices that have to be made before the legislation, not after.
Here is a fact that ought to feature more prominently in Namibia’s health-financing debate: the National Medical Benefit Fund is not a new idea awaiting a decision. It is an existing legal instrument awaiting implementation. The NMBF is written into the Social Security Act of 1994 — the same Act that established the Social Security Commission — and more than three decades later it has still not been brought into being.
In the intervening years it has been mentioned in Cabinet papers, referenced in successive MOHSS strategic plans, and embedded in the architecture of the Universal Health Coverage Policy. And yet it has never been designed in a form a citizen or provider can read and respond to. It exists as a statutory intention without an institutional shape.
What has changed in 2026 is that the surrounding conditions have finally caught up with the statute. With FIMA in force, Vision April 2026 reshaping the demand side, and the MOHSS Strategic Plan committing the country to Universal Health Coverage by 2030, the question is no longer whether the NMBF arrives, but in what form. The choices that determine whether it works are design choices, and they have to be made deliberately — before the political moment forces a hurried legislative answer.
The cautionary example is next door. South Africa’s National Health Insurance Act passed in 2024 but remains mired in constitutional challenge, funding uncertainty and operational vagueness. The lesson is not that NHI is wrong; the lesson is that legislation outran institutional readiness, and the system has been arguing about implementation ever since. Namibia, having waited thirty years already, has no excuse not to do this in the opposite order.
The gap that has not closed
The most striking feature of the Namibian coverage problem is how little it has shifted. A detailed study of the proposed NMBF and the informal economy — drawing on interviews across the Social Security Commission, the Ministry of Health, the Ministry of Labour, the Namibian Employers’ Federation and the informal sector organisation NISO — documented that in 2006, only around 18% of the population was covered by medical aid funds, leaving over 1.7 million Namibians without any health insurance. Roughly 200,000 formally employed Namibians were among the uncovered, because no low-cost product existed for them.
Two decades later, the figure has barely moved. Current estimates still put medical aid coverage at approximately 18% of the population, with about 82% relying on the public system or out-of-pocket spending. The structural diagnosis the study made — that there is no cross-subsidisation between rich and poor, and that the cheapest available private product still consumes 15% of a low-income worker’s monthly income, rising to as much as 22% for family cover for an unskilled worker — remains substantially true today.
That stability is itself the argument. A coverage gap that has not narrowed in twenty years will not narrow through the same mechanisms that left it open. The market has had two decades to produce an affordable mass-market product and has not done so, because the economics do not work without pooling and subsidy. This is precisely the space a properly designed NMBF is meant to occupy.
The advantages Namibia starts with
Before turning to the design questions, it is worth being honest about what makes the Namibian case more tractable than the South African one.
Scale is the first advantage. A population of roughly three million is a system that can plausibly be redesigned in a single coordinated programme. South Africa’s complexity — sixty million people, hundreds of medical schemes, an enormous private hospital industry — is not a problem Namibia has to solve.
Institutional foundations are the second. NAMAF already provides a standardised coding and tariff framework. NAMFISA is a competent regulator with FIMA-grade powers and visible involvement in UHC policy drafting. The Social Security Commission — the statutory home of the NMBF — already administers contribution-based national funds, including the Maternity, Sick Leave and Death benefit fund and the Employees’ Compensation Fund, and has the collection machinery the NMBF would need. The institutional building blocks are on the table; what is missing is the assembly.
Political alignment is the third — at least for now. Vision April 2026, the FIMA commencement, the UHC Policy launch and the recent tariff realignment are not coincidences. They indicate a Treasury, a Presidency and a Health Ministry working in the same direction. That alignment is a precondition for NMBF design that may not persist; it is a window, not a permanent state.
Design choice one: single payer or regulated multi-payer
The most fundamental choice is structural. A single-payer NMBF — one fund, mandatory contributions, replacing or absorbing the existing medical aid funds — is the maximalist version. A regulated multi-payer system, in which the NMBF operates alongside existing funds under a strong common regulator, is the gradualist version.
The single-payer case rests on equity and pooling efficiency. One pool means one risk pool, one administrative system, one negotiating position with providers, and the maximum cross-subsidisation between healthy and sick, rich and poor. It is also the version most likely to produce decade-long political and operational disruption.
The multi-payer case rests on what already exists. Namibia’s medical aid funds are institutions with member trust, administrative capacity and provider relationships. Dissolving them recreates exactly the implementation paralysis that has stalled the SA NHI. A multi-payer model — where the NMBF guarantees a defined minimum benefit package for every Namibian, financed by mandatory contributions, and where existing funds compete to deliver that package and offer cover above it — uses the institutions rather than fighting them.
The research underlying the original NMBF proposal points firmly in this direction. It envisaged the NMBF as a basic minimum benefit package — primary, hospital and emergency cover for the most common conditions — with the private medical schemes acting as a “top-up” for more complex procedures. That is a regulated multi-payer design in all but name, and for a small country with a functioning private medical aid industry, it is the more defensible starting point. The single-payer option remains available as a destination if the multi-payer system proves inadequate; the reverse path is much harder.
Design choice two: who the fund must cover
The hardest design problem is the one the original research kept returning to: the informal economy. The NMBF, as drafted in the 1994 Act, was built for employed people with regular wages and an employer to share contributions. But more than 150,000 Namibians earn their living in an informal sector characterised by irregular, low income, no employer, and no employment contract — and it is precisely these workers, together with the unemployed, who most need coverage.
This is where design has to be inventive rather than mechanical. The research surfaced several workable ideas: contribution structures tailored to irregular income — for instance, allowing farmers to contribute during selling seasons rather than monthly; sector-specific schemes for hawkers, vendors and farmers with terms that fit their cash flow; discounted rates for upfront or lump-sum payments in place of monthly premium collection; and using an organised intermediary — the informal sector organisation — as the collection bridge between the fund and dispersed informal workers. None of these is exotic; all of them have analogues in micro-insurance schemes elsewhere. What they require is a fund willing to design for the informal worker first rather than bolting them on afterward.
Design choice three: contribution architecture
Funding the NMBF requires choosing between three financing instruments: a dedicated payroll contribution, general revenue allocation, or a mixed model. International evidence, and the research on the Namibian case specifically, favours mixed financing built on the principle of solidarity — contribution rates that are asymmetric and income-related, so that poorer members contribute less but benefit equally.
A concrete illustration from the research: if a formal-sector employee contributes around N$54 per month to social security, an informal-sector worker might contribute half that — but receive the same benefit. The shortfall is met through cross-subsidy and a ring-fenced general-revenue allocation for the unemployed and indigent. This is the architecture that fits Namibia’s economic structure, where formal employment cannot carry the whole system and a broad revenue base is needed to keep contribution rates low. The collection mechanism for the formal-employment contribution already exists at the SSC; what is missing is the dedicated revenue line and the subsidy formula.
Design choice four: provider reimbursement and the public-private question
How the NMBF pays providers determines the system’s clinical and financial behaviour. A blended model — capitation for primary care, episode-based payments for acute admissions, fee-for-service for defined specialist procedures — is the design that has worked in middle-income countries with mixed public-private delivery, and it gives the regulator multiple levers to adjust as evidence accumulates.
The research is emphatic on one point that bears directly on current events: the NMBF should contract strategically with both the public and private sectors wherever capacity exists, rather than favouring one. With the recent state-hospital tariff realignment bringing public-facility cost recovery closer to private levels, the conditions for genuine public-private contracting under a common benefit standard are more present now than when the proposal was first written. The NMBF could be the mechanism that turns the tariff convergence into a coherent purchasing strategy rather than a one-off price adjustment.
Design choice five: the data spine
The single most important design choice is the one rarely discussed in public commentary: the NMBF cannot function without a national claims-data infrastructure. Coding standards, electronic health records, claims adjudication, fraud detection, utilisation review and outcome measurement all depend on it — and the PSEMAS experience, with its tens of thousands of estimated ghost beneficiaries and well-documented exposure to fraud and false claims, is the cautionary tale of what happens when a national-scale fund operates without that spine.
Building it is a five-year project. It has to start before legislation, not after. NAMAF coding standards, NAMFISA’s regulatory data requirements under FIMA, and the National Health Act 2015 mandate for a centralised digital health-records system are the components. The integration is the work.
A proof of concept worth remembering
Namibia has done a version of this before, at small scale, and it worked. Between 2004 and 2008 the PharmAccess-supported Okambilimbi project created several low-cost health insurance products — in partnership with private medical aid funds and through a shared HIV/AIDS risk-equalisation pool — aimed specifically at previously uninsured low-income workers. By the end of 2008, more than 36,000 previously uninsured employees had enrolled in one of these new affordable products. The project’s central lesson was that affordable mass-market cover became possible only once the wider medical aid fund industry was brought in rather than bypassed. That is the same lesson the NMBF design has to absorb: the private funds are part of the solution, not an obstacle to it.
A sequenced path
The right sequence is the opposite of the SA NHI sequence. Build the data spine first. Negotiate the multi-payer framework second. Define the minimum benefit package and the solidarity-based contribution architecture third. Pilot delivery in a defined population segment — the formally employed, then a structured informal-sector cohort — fourth. Legislate the national rollout fifth.
This is consistent with what the original research concluded: a phased introduction, compulsory membership to guarantee a stable funding base, regulation by NAMFISA if the fund operates like a medical aid, and a deliberate scaling-up from a limited programme as effects are demonstrated and resources expand. Both the SSC and independent economists interviewed for that work estimated the full path to universal coverage at fifteen to twenty years. The instinct to compress it will be the largest political risk. The instinct to defer it — for another thirty years — is the larger fiscal and moral one.
The bottom line
A National Medical Benefit Fund is not a theoretical destination for Namibia. It is a thirty-year-old statutory commitment that the convergence of FIMA, Vision April 2026 and the UHC Policy has finally made implementable. The coverage gap it was designed to close has not narrowed in two decades, which is the clearest possible evidence that the market will not close it unaided.
The design choices outlined here are not the only ones, and they are not prescriptions. They are the architecture of the conversation that has to happen before the architecture of the fund can be settled. The country has the institutional building blocks, a statutory mandate, and even a small-scale proof of concept in its own recent history. What it needs now is a design table — and the discipline to build in the right order.
*Willem Kanyondi is a nurse practitioner turned clinical auditor and CIMA candidate, specialising in healthcare revenue integrity and risk. He writes on the intersection of clinical operations, financial management and healthcare financing. He writes here in his personal capacity.
