Pharmaceutical companies to stop supplying drugs to NHIS

• Posted on July 10, 2014July 10, 2014
• by Nana Kwesi Coomson
• Comment

Spokesperson for the Ghana Chamber of Pharmacy, Ernest Owusu Aboagyen says they will cut its supply of drugs to health insurance service providers who depend on the National Health Insurance Scheme (NHIS) to pay for their drugs effective August 1, 2014.

Below is the full statement from the Chamber of Pharmacy

DELAYED REIMBURSEMENT FOR MEDICINES:

PHARMA DISTRIBUTORS REVIEWS TRADE TERMS WITH NHIS PROVIDERS!

The Ghana Chamber of Pharmacy has noted with worry once again the inordinate delay in the National Health Insurance reimbursement for medicines supplied to participating health service providers.

The Chamber, an umbrella body of all corporate players in the Pharmaceutical Industry has observed that in 2013 for instance, only fifty-four percent (54%) of the statutory payments due to be released from the Finance Ministry were actually released to the Insurance Authority. This inadequate releases and further delays in 2014 have (and continue) to take a huge toll on the businesses of the Pharmaceutical Companies.

The Finance Ministry’s failure to release funds to the NHIA means the Health Insurance Authority is woefully behind time in honouring its obligations to the service providers who in turn are not able to pay for the medicines supplied. For example, whereas the NHIA is in arrears for six (6) months in some regions (Ashanti) it is in arrears of nine (9) months in other regions (Upper East, Northern). This means drugs supplied to Public hospitals and other national health insurance service providers have not been paid for, for the periods under reference.

The current situation has been gravely aggravated by the dwindling exchange rate. The current exchange rate regime is creating huge losses to the pharmaceutical distributors. This situation has impaired the ability of the industry to service loans and overdrafts procured from the banks to bridge the funding gap in order to sustain supplies to the health institutions. This has largely affected the ability of our members to raise letters of credit from the banks to pay suppliers in order to replenish stocks for further deliveries to the insurance providers.

This situation is unsustainable and has already created shortage of stocks of essential medicines within the industry with an imminent shortage of essential medicines within the health sector.

Therefore, the Ghana Chamber of Pharmacy wish to call on the Government to intervene as a matter of urgency to direct the Ministry of Finance and Economic Planning to clearly ensure the immediate release of Funds for the Scheme. Section 52 of Act 852 of the NHIL requires the Minister of Finance to cause all collections for NHIF

to be paid within 30 days to the fund. The NHIS is required under the NHIL to reimburse service providers two months after receipt of claims.

The Chamber brings to the attention of all health insurance service providers that effective August 1, 2014, pharmaceutical distributors can only offer two months credit to health institutions. Pharmaceutical distributors are not able to supply medicines and medical consumables to any health institution that has debt arrears beyond two months.

End…

Author: Nana Kwesi Coomson (www.233times.net)