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Jakarta Post

Indonesia health cards and the '€˜missing middle'€™

  • Rosalia Sciortino

    The Jakarta Post

BANGKOK   /   Sat, November 29, 2014   /  09:43 am

The first-ever Universal Health Coverage (UHC) Day on Dec. 12 will commemorate the UN endorsement of '€œuniversal access to health care without financial hardship'€ and urge governments to prioritize UHC for sustainable development.

In Southeast Asia, Singapore, Brunei, Malaysia and Thailand already implement UHC to some extent. In Indonesia, the National Social Security Law mandated the introduction of social health insurance already in 2004, but divergence of views and interest resulted in a decade-long delay. Only in 2014 was the Social Security Management Agency (BPJS) established to execute the national health insurance or JKN.

The JKN aims to enroll 121.6 million Indonesians in the first year and achieve universal coverage of an estimated 250 million in 2019, thus becoming one of the largest social health insurance schemes globally.

To finance the system, three funding streams have been determined: the government remains responsible for the poor and vulnerable, estimated at 86 million people; employees in the formal sector are to share the costs of 5 percent of their wages with employers; and the self-employed and workers in the informal sector are required to pay a monthly premium in the range of Rp 25,500 (US$2.10)-Rp 59,500, depending on ward class.

The government decision to pay the premiums for the poor and vulnerable is laudable. However, it may not be sufficient in a country where poverty dynamics are fluid and a large number of the near poor live close to the poverty line of Rp 233,000 monthly: nearly 40 and 60 percent of Indonesians live below 1.5 and 2 times this poverty line respectively.

The tenuous and shifting boundaries between poor and less poor make reaching the intended group difficult. Compounded by inadequate coordination across government levels, unreliable statistics and high population mobility, targeting has proven a time-consuming and expensive exercise prone to error and manipulation. A 2011 analysis by the National Socioeconomic Survey found that Jamkesmas managed to cover only about 33 percent of the targeted group, while leakage to non-eligible beneficiaries reached 53 percent.

The recent launch of the Indonesia Health Card (KIS) can thus be considered an effort to broaden the targeting criteria and ensure inclusion of vulnerable populations. In 2015, 4.5 million underprivileged will become eligible for coverage, including 1.7 million social welfare beneficiaries, such as the homeless, orphans and the elderly in hospices.

This approach of gradually adding vulnerable groups and expanding coverage is in line with the JKN system and accelerates its realization. Still, its unitary principle should be upheld. Creating or recreating parallel schemes would complicate an already complex endeavor, confuse health service providers and the public and lead to differential treatment of patients.

To avoid interfering with delivery, the latest KIS branding should better apply to all JKN members, irrespective of program and financing streams. Similarly for the benefit package, if preventive procedures are envisioned for KIS cardholders they should also concern other JKN members. For JKN to be as comprehensive as planned, it is essential to gradually expand coverage beyond contraceptive services and immunization to the full range of preventive and rehabilitative services.

A more fundamental question is whether the KIS approach goes far enough in resolving the targeting problem and in expanding coverage. Given weak social welfare data and the unclear demarcation of vulnerability also vis-à-vis poverty, there is an increased risk of mistargeting and leakage as well as duplication in determining and registering beneficiaries.

Moreover, this approach leaves unresolved the major challenge of covering people in the informal sector '€” consisting of 54 percent of 118.05 million workers in 2012. For many of them to pay even a modest premium is a substantial burden, especially with a large family.

The average monthly income of a household in the informal sector, generally comprising four persons, is Rp 1,508,724 per month, with 80 percent of the households below that average and thus among those close to the poverty line. Also, regular payments may prove difficult to enforce for the low-middle class with irregular jobs and unstable incomes.

Other Southeast Asian countries are also challenged with covering the '€œmissing middle'€ i.e. informal workers underrepresented in UHC. While the Philippines insists on their paid membership, Vietnam partially subsidizes their premiums and Thailand covers them fully. Shouldn'€™t Indonesia contemplate Thailand'€™s policy? After all, the real rich in the informal sector would prefer private insurance coverage and treatment.

The JKN 2012'€“2019 road map mentions the possibility of government subsidies for the '€œnon-poor'€ in the informal sector, but whether it should be full or partial (and how partial) is not elaborated. This also depends on the government'€™s capacity to ensure financial sustainability.

Indonesia has space for allocating more financial resources to health, being below the recommended 5 percent of GDP. The trillions in savings from the latest reduction in fuel subsidies will be partly devoted to expanding coverage of the low-middle class in the informal sector, which is expected to be badly affected, and yet not part of amelioration efforts such as the KIS. Higher tobacco taxes could also ensure additional revenues and reduce the burden on JKN by discouraging smoking.

Furthermore, close monitoring and elimination of inefficiencies and mismanagement could maximize the value of available funds. Responsible ministries could enforce measures to transition enterprises into the formal sector and compel companies to formally register their workers, thus reducing the numbers of subsidized JKN members.

These and other strategies could be considered to expand the scope and impact of KIS and realize JKN'€™s promise of affordable care for all, so that those in the middle also have reasons to celebrate UHC Day.


The writer is a health and social development adviser and author of Menuju Kesehatan Madani (Toward Civic Health, Gadjah Mada University, 2007).

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