Hospital admissions account for approximately one third of total expenditure at the Namibia Health Plan (NHP), making them the largest cost component for the medical aid fund.
NHP Principal Officer Dantago Garosas said healthcare claims remain the primary driver of rising costs at the scheme, with hospitalisation representing the biggest spending category. This is followed by medicines and pharmacy claims, and then specialist and general practitioner services.
“If we look at our cost components, hospitalisation is our largest expense and accounts for about a third of our total costs. After that come medicines and pharmacy costs, followed by specialists and general practitioners. Healthcare claims are the main factor pushing up our expenditure,” Garosas told The Brief.
Garosas said maintaining sustainability in an increasingly consolidating medical aid sector requires active cost management across several areas, including healthcare claims, investment performance and operational expenses unrelated to healthcare services.
“Our strategy is centred on sustainability. The areas we can influence directly are effective claims management, maintaining strong investment returns and controlling our non-healthcare operational expenses,” she said.
She added that provider tariffs remain a significant pressure point within the private healthcare sector, although she cautioned against describing higher tariffs simply as overcharging, noting that healthcare providers operate within a market-based system.
According to Garosas, when healthcare providers charge above established industry tariff benchmarks, the additional costs are often transferred to members through co-payments and out-of-pocket expenses.
“In a market environment, providers are able to charge what they consider appropriate. We try to manage this by adhering to industry tariff guidelines and benchmarks. However, when providers charge above those tariffs, the member ultimately carries the cost through co-payments and additional out-of-pocket expenses,” she said.
Garosas said tariff pressures are not unique to the Namibia Health Plan but represent a broader challenge across the private medical aid industry.
“The issue of provider tariffs affects the entire private medical aid sector. It is something that all schemes must manage carefully within what they can afford while still ensuring long-term sustainability,” she said.
She added that the scheme conducts annual benefit design reviews, supported by actuarial modelling and analysis of utilisation trends, to ensure that benefits remain affordable while maintaining the financial stability of the fund.
“The balance between affordability and sustainability is always challenging. Through our annual benefit design process we analyse utilisation trends and adjust benefits in line with what the scheme can sustainably provide,” Garosas said.
