Sterling Bank: Health Sector Finance PDF

Sterling Bank: Health Sector Finance November 2024  INTRODUCTION Despite the increasing demand for healthcare services in Nigeria, the sector remains plagued by fragmentation on both the supply and demand side...

Sterling Bank: Health Sector Finance November 2024  INTRODUCTION Despite the increasing demand for healthcare services in Nigeria, the sector remains plagued by fragmentation on both the supply and demand side Overall, the challenges faced by the market include: DEMAND SIDE SUPPLY SIDE ISSUES ISSUES Accessibility – Drop-off from the health system due to inability to pay and Infrastructure – Number of centres needed distances to health centres to tackle the growing disease burden are severely inadequate and the few centres Quality of service – low perception of available do not have the requisite service delivery and little or no infrastructure trust in the system Skills – Short supply of qualified medical Inability to pay - More than 90% of the professionals and increased brain population pay out of pocket or drain. have basic insurance that does not cover the secondary and tertiary Funding – Funding required to upgrade care needs when required infrastructure, train and retain talent is unavailable Overview of the Health Sector in Nigeria According to the World Health Organization (WHO), Nigeria is ranked 187 out of 190 countries in terms of health system performance in 2003, but, improved to 163 out of 191 countries in 2021. However, the expected improvement of the heath sector in Nigeria cannot be achieved without an improvement of the larger Nigerian context. For health indices to improve, fundamental issues affecting the quality of life of Nigerians such as security, electricity, transportation, amongst others must improve. This will invariably increase purchasing power for the average Nigerian whilst investors confidence is increased to boost local production of health infrastructure. oblems With Health Financing Lack of effective Lack of Record keeping Demand & Corporate Governance Lack of understanding the business of Fragmentation and Lack healthcare and of Collaboration healthcare management  Strategies to improve Health Sector in Nigeria Prioritise health Performance Enforcement Adoption investments Management To address key Enforce existing Adopt an Establish a social government integrated systemic determinants of policy and planetary approach for health including regulation on health performance adequate harmful governance management sanitation, products such approach and access to clean as alcohol, including accountability air and water, tobacco, drugs, tackling sources at all levels of and food and sugar of indoor and the health security, outdoor air system. especially for pollution, and children. other environmental risk factors. Our Goal The goal of the Health Finance Sector, is to provide a system that enhances easy and affordable access to healthcare across various social classes, by creating bespoke solutions targeted at improving all stakeholders. The Health Finance Sector harmonizes various solutions to deliver truly sustainable healthcare system and The Health Value Chain Regulators, Association & Unions NAFDAC – National Agency for Food and Drug Administration and Control PSN – Pharmaceutical Society of Nigeria SON – Standard Organization of Nigeria NMA- Nigeria Medical Association Government Practitioners & Consumers Federal Ministry of Medical Practitioners (Doctors, Health State Ministries of Pharmacists, Nurses Radiologists, etc.) Health Patients Healthcare Providers NGO’s & DFI’s Hospitals World Health Organization Diagnostic Centers Pharmaceuticals (WHO) World Bank Clinics PharmAccess Foundation Health Insurance Medical Credit Fund Health Emergency Initiative Health Management Organizations (HMOs) National Health Insurance Scheme (NHIS)  OUR APPROACH Building of, and partnership with Providing affordable Platforms and finance to the Ecosystems to improve efficiency pharmaceutical value in the chain delivery of health services Adoption and Infrastructure overhaul enabling of technology to Capacity building for through medical equipment improve access to quality practitioners. financing. pharmaceutical products and access to quality and affordable healthcare OUR PRODUCT – RETAIL BANKING STERLING HEALTH HEALTH DIGITAL TEMPLATE BANC HOSPITAL CREDIT 9 OUR PRODUCT – STERLING DIGITAL HOSPITAL Sterling Digital Hospitals Electronic Medical Records Telemedicine Management Information Systems Digital Loans  Our Solution Efficiency in Medical Record Keeping Our solution is an up to date and scalable EMR/HMIS system powered by Helium Health.  Our Solution No No Training No Upfront Infrastructur Budget? Internet? Payments ? e? We will fund it It is covered The system No, Just a works offline small transaction fee per invoices  Our Solution No hassles with bank loan documentation, we will underwrite all the set-up costs. This will be in exchange for a transaction fee going into the future  Our Solution Basic/Quick emergency loans Access to Credit – Adopting the EMR Working service opens the capital hospital to a new world finance of access to finance. Every Hospital that adopts our EMR service will have access to the following Credit needs Fixed asset finance  Our Solution HR Incentives: Hospital Staff will have access to device financing through our integrated service platform— Altmall, with a convenient repayment plan. Personal loan facilities will be made available to staff.  Our Solution Cost of Cash Handling: Cash has its major costs and inconvenience; such as inaccurate reporting, loss of funds and more. Our payment platforms such as POS, Internet banking are integrated to the EMR and will ultimately improve efficiency, reporting,  OUR PRODUCT – TEMPLATE CREDIT TARGET PRODUCT DESCRIPTION FEATURES MARKETS Obligor: Uncollateralized Up to N10m Collateralized up to N50m To finance the purchase of medical Stock Finance Facility Interest Rate: Based on Raroc supplies and consumables Tenor: Up to 12 months (available in a 90-day clean up cycle) OTHER HUMAN HEALTH-RELATED Obligor: Retail - Up to N10m To finance the purchase of stock and Wholesale – Up to N20m Working Capital Facility other working capital needs Interest Rate: Based on Raroc Tenor: Up to 12 months. Other features: TICALS Competitive Interest rate Improved TAT (Loan can be disbursed in 5- 10 working days) SES 17 Clean lending up to N20m  TEMPLATE CREDIT- ELIGIBILITY CONDITION A minimum of 12 months banking relationship with any bank. The hospital, diagnostic center, pharmaceutical or any other human health-related company must be actively operational for at least 2 years. The company and its promoters must have clean credit reports The Bank’s collection platform must be deployed in the business. The Bank shall be the sole collecting bank for the business. A global limit of N7bllion. An obligor cannot access an Overdraft and a Term loan at a time. 18  TEMPLATE CREDIT- FAQ 1. Types of facility that can be accessed via the template credit? - Stock Finance Facility -Asset Finance - Working Capital Loans(Overdraft/Short term loans) 2. Can I access an unsecured facility under the template credit? - Yes, up to N20M is uncollaterised. 3. How much can I access under stock finance? - Maximum of N50M 4. Do I need to ask customer to provide an equity contribution for stock finance? - No 5. What’s the maximum limit that customer can access under stock finance? - Average monthly turnover over 12months. 6. What is the maximum amount that can be financed for Asset Finance For Brand New Assets? 30% of annual turnover, subject to a maximum of N50 million. For Certified second-hand assets: 15% of annual turnover, subject to a maximum of N20 million 19 TEMPLATE CREDIT- FAQ 7. What is the equity contribution required for Asset finance? -Minimum of 20% of the value of asset for brand new assets and a minimum of 40% for second hand assets. 8. What is the maximum Tenor for a working capital facility? 365 days( maximum of 90 days cycle for overdraft facilities) 9. What is the maximum tenor for asset financing Brand new assets: 36 months/48 months(for new vehicles e.g Ambulances) Certified second-hand assets: 18 months. 20 TEMPLATE CREDIT- PROCESS FLOW Request is submitted to Offer Letter and CAD for booking CFA is by the Legal RM Retrieves Either the HFO Generated upon Legal Help Desk help desk and Documents for Assessment of or RM log Approval of Approval and reviews offer RM will follow Processing And Request is request on RCP Request by CGO sent to letter and up on other engages Health conducted by to BM/BE for or the ED customer along relevant documentation Finance the Health Team Concurrence with other documents issues till Officer(HFO) relevant request is documents. booked. 21 HealthBanc: Securing Lives Healthcare Problems in Nigeria The year 2020 taught us the importance of Fragmentation of healthcare supply and a functional, well-funded healthcare system demand making it difficult for appropriate when a pandemic declared war on private sector investments to drive efficiency, countries. Economies have had to shut effectiveness and productivity in the sector. down to contain the disease to avoid a meltdown. Similar to a war, the losses are huge, except there was no military artillery to defend ourselves with. Narrow health insurance penetration leading The state of global healthcare forces us in to huge out-of-pocket spend on healthcare Nigeria to start to reset our domestic which results in poor health-seeking healthcare system from a functional behaviour and eventually ranking Nigeria low pharma manufacturing system to medical across all health indices. research labs to health insurance and finally hospitals that work with doctors/nurses/care workers who are happy. HealthBan c Health Banc is an aggregated service channel for the Nigerian health sector enabled by technology and driven by finance. At Sterling, we have spent years thinking through the needs for the sector and will approach the challenges identified using technology as much as we can. For ease, the health banc will; 01 02 03 Formalise the Structure the Unify the informal unstructured fragmented Pharmaceutica ls Pharmaceutical services are not accessible, consistent or affordable which provides an opportunity in the sector to provide services that are adequate, safe and convenient. Our approach will be 2 – pronged: Provide financing to innovative Build a B2B distribution model that allows pharmaceutical business models that more harmonized requests from enable better drug distribution e.g. manufacturers. investment and collaboration with Drugstoc 1 2 3 Both approaches allow The pharmaceutical us gather data that industry provides both helps pharma cheap deposits and The pharma industry is manufacturers improve ability for quick retail- self-funding. their production like loans which helps us with balance sheet management. Service Providers (Clinics, Laboratories etc.) Demand Side Issues Our Solution Supply Side Issues Free Electronic Capacity Medical Record Development Infrastructure Accessibility (EMR) Solutions: Quality of service Skills Hardware Financing Inability to pay Funding Health Management Organizations HMOs are instrumental to the cause of ensuring access to affordable healthcare for all. Hence it is vital to design solutions for HMOs that will ensure flexibility and ease of access to health insurance. Insurance-as-a-service (IAAS): Universal Claims System The Health Banc will deploy an IAAS scheme that creates flexibility and allows users make monthly premium payments. It will be digitally led and enable users access the service for free to test market acceptance and encourage usage A universal claims system will create a single platform for delivering services across multiple HMOs. It will also create Sign up uniform pricing for services across various Free Telemedicine Free Treatment (Basic information consultation (Drugs) healthcare providers. provision) OUR PRODUCT – HEALTH INSURED KEY FEATURES This is an HMO scheme available for individuals aged 0 – 65 years. This include entrepreneurs, menial workers, young and growing families, outsourcing companies, organizations with contract staff With as little as 1,000 monthly, individuals can access care up to N250,000 Access to over 500 hospitals nationwide, list is contained in the Appendix Onboarding can be done through https://healthbanc.ng/health-insurance or send the list to [email protected] to manually onboard clients. This solution is brought to us as a result of Sterling Bank 28  OUR PRODUCT – HEALTH INSURED LIST OF BENEFITS BENEFITS LIMIT Overall limit N250,000 Registration Covered CONSULTATIONS Covered General Practitioners /Medical Officers Covered Supply of drugs & medication – drugs recommended in the course of Covered the treatment for covered services LABORATORY & DIAGNOSTIC SERVICES (based on the clinician’s judgment) Covered Haematology Covered Clinic Chemistry Covered Microbiology Covered Radiological Investigations (X-ray Services) Covered ACCIDENTS & EMERGENCIES Covered for 5 days Resuscitative or life saving initial treatment (up to plan benefits limit) Covered Definitive treatment subject to health cover benefit and limit. Covered MINOR SURGERIES & PROCEDURES- MORATORIUM APPLIES Covered up to N50,000 (after 3 months of uninterrupted subscription)) 29  [email protected] 30  Thank 31 you