Lagos targets N400bn yearly funding as Gov't pushes for mandatory health insurance
By Sodiq Adelakun
The Lagos State Government says it can generate over N400 billion every year to strengthen the health sector if at least 20 million residents enroll in the state’s compulsory health insurance scheme.
The Commissioner for Health, Prof Akin Abayomi, stated this during the launch of the Lagos Private Health Partnership (LPHP)—a new reform designed to overhaul health financing, widen insurance coverage, and guarantee fair access to quality care.
According to him, the projection is based on an average annual premium of N20,000 per enrollee.
He warned that without mass enrolment, the state would not achieve a functional health insurance system capable of delivering equitable, people-focused services.
Abayomi lamented that despite Lagos’ large economy and a population of more than 25 million, the state still struggles with weak health financing, low insurance uptake, frequent loss of health workers, and increased medical tourism.
He said the newly unveiled LPHP was deliberately created to bring fairness, transparency, and sustainability into the sector through a coordinated public–private framework.
The platform, he noted, represents a clean break from years of fragmented private insurance practices marked by unhealthy price competition and loss of trust.
The state’s health insurance policy known as Ìlera Èkó—became compulsory after an Executive Order signed by Governor Babajide Sanwo-Olu in July 2024.
The order mandates all residents, employers, and workers to subscribe to either the state-run scheme or an accredited private insurer before they can access non-emergency public health services.
Abayomi said full enforcement of compulsory insurance will begin after a six-month sensitization period, in line with the governor’s directive to strengthen risk-pooling, cross-subsidization, and financial protection for citizens.
He explained that the LPHP will run on a digital marketplace where enrolment, provider selection, fund transfers, claims processing, monitoring, and reporting will be handled seamlessly.
He added that competition among insurers will shift from price undercutting to value, with standardized plans and strict quality control under HEFAMAA.
The Commissioner also disclosed that the state will introduce a risk equalisation and solidarity fund that requires private insurers to contribute 13 per cent of premiums to support vulnerable residents, improve emergency response, and drive universal health coverage.
Speaking at the launch, Governor Sanwo-Olu—represented by the Secretary to the State Government, Mrs Abimbola Salu-Hundeyin, described the LPHP as a major step toward building a resilient health financing system that protects households from catastrophic medical expenses.
He said the reform stems from Lagos’ domestication of the National Health Insurance Authority Act of 2022 and will strengthen the private sector, which provides more than 70 per cent of healthcare services in the state.
According to him, clear rules will now guide insurers and providers on profitability, service quality, and fairness.
The Governor added that Lagos has adopted a population-based enrolment model for workers in private organisations to boost risk-sharing and expand access to subsidised plans.
Chairman of the Lagos State Health Management Agency (LASHMA), Dr Adebayo Adedewe, described the LPHP as a credible solution to long-standing insurance problems.
Also speaking, the National Adviser on Health Insurance for the Healthcare Providers Association of Nigeria (HCPAN), Dr Jimi Arigbabuwo, said the initiative marks a turning point in the integration of private providers into Nigeria’s health system.
He urged the government to ensure fair compensation for providers to maintain sustainability, improve patient satisfaction, and cut down on medical tourism.