Mahama started investing NHIA funds in All Time Capital – Govt

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The erstwhile Mahama administration, as far back as 2012, invested funds of the National Health Insurance Scheme (NHIS) in private firm All Time Capital, Deputy Minister of Information Pius Enam Hadzide, has said.

The main opposition National Democratic Congress (NDC), at a press conference on Monday, 15 April 2019, accused the Akufo-Addo government of illegally transferring GHS17,548,377.20 of National Health Insurance Scheme funds into a private fund management company, All Time Capital Investment, which has failed to pay back the money.

The party’s National Communication Officer, Mr Sammy Gyamfi, said: “Recently in his state of the nation address, and while on a tour of the United States of America, President Akufo-Addo peddled blatant untruth when he claimed that the NHIS is ‘buoyant and has come back to life’.

“The truth of the matter is that the NHIS, very known to the President, is in a deplorable state and gasping for liquidity breath. Currently, the NHIS owes service providers in all the sixteen regions of Ghana claims covering a period of almost twelve (12) months. This has landed most healthcare facilities in distress.

“For instance, the Daily Graphic reported on Thursday, 28th March 2019 that the Central Regional Hospital is on its knees begging to be paid an amount of GHS6.1 million owed to it by the Scheme, in order to settle its indebtedness to suppliers of critical drugs and medical consumables.

“This is just one example of how our health facilities are being crippled as a result of the huge indebtedness of the NHIS to service providers. Ladies and gentlemen, we have also taken note of persistent claims by President Akufo-Addo that his government has cleared a total of GHS1.2 Billion NHI arrears it inherited from the erstwhile Mahama government. We wish to state without any equivocation that, this claim is mischievous and not borne out by the facts.

“After the Association of Private Clinics and the leadership of Government Hospitals disputed this claim, one would have thought that the President will desist from peddling this obvious deception. However, it appears President Akufo-Addo is determined to deceive the nation as far as this matter is concerned. Indisputable evidence contained in the 2017 NHIS Fund Allocation Formula presented to the august house of Parliament by the Minister of Health shows that, total arrears of NHI claims stood at GHS425.79 million as at December 2016. This completely belies the claims of President Akufo-Addo and exposes him as a very dishonest,” Mr. Gyamfi said.

Mr Gyamfi said such problems have made the NHIS unattractive, explaining that currently, the scheme has 10.410 million people as against 10.786 million people in 2016.

“The above statistics depict the declining confidence of Ghanaians in the National Health Insurance Scheme and expose the dire straits that the scheme has been plunged into by the Akufo-Addo government,” Mr Gyamfi stated.

The party continued: “It is worthy of note, that even though best practice dictates the use of 75% to 80% of accrued funds to finance the scheme, the Akufo-Addo government is currently utilising only 60.64% of NHI accrued funds for their intended purpose. This points to the misapplication of NHI funds by the Akufo-Addo government, and we can speak of several of such instances. For example, in 2018, about GHS163 million of NHI funds were used to pay nursing trainee allowance. While the scheme continues to struggle, more than GHS300 million has been projected to be spent on ICT, and another GH¢5 million is being devoted to Corporate Social Responsibility (CSR) in 2019. This is a complete aberration from the core objective of the fund. The wanton misapplication of NHI funds stems largely from the capping policy introduced by the Akufo-Addo government through which over the last two years, more than One billion Ghana Cedis of NHI funds have been diverted for projects which are unrelated to the core objects of the scheme.

“Also, our checks have also revealed that, while the scheme remains cash strapped, Government is in the process of outsourcing claims management to a private firm with implications of more cost to the already burdened scheme. Friends from the media, these stark realities have resulted in the dwindling fortunes of the NHIS, hence its inability to address the crucial health needs of Ghanaians. We think that these acts of mismanagement of the NHIS must be immediately reversed to save the scheme from total collapse. Let me state that all the above statistics are contained in the 2019 Annual Allocation formula and other documents presented by the NHIA to the Health Committee of Parliament.

“Ladies and gentlemen, we have already demonstrated to you enough evidence of the wanton misapplication of NHI Funds by the Akufo-Addo government, which is fast precipitating the demise of the scheme. But, perhaps even more egregious are certain scandals we have uncovered, which have conspired with the above to cripple the scheme. Our painstaking investigations have revealed that upon President Akufo-Addo assuming office, the National Health Insurance Authority without any due diligence and with indecent haste, transferred a whopping Seventeen Million, Five Hundred and Forty-Eight Thousand, Three-hundred and Seventy-seven Ghana Cedis, and twenty pesewas (GHS17,548,377.20) in three tranches to a private financial house, All-Time Capital Limited, supposedly as investment. Incontrovertible evidence available to us indicates that, despite repeated efforts by the scheme since November 2018 to retrieve the invested funds and accrued interest, all time-Capital Limited has failed to pay back.

“In a recent twist which has angered some workers at the NHIA, All Time-Capital Limited informed the NHIA Chief Executive that it could only attempt some payments if the invested funds were allowed to run for an additional year. This situation is contributing to the worsening financial fortunes of the scheme. Ladies and gentlemen, it is this same financial company, All Time-Capital Limited which was involved in the round-tripping of liquidity support provided by the Bank of Ghana to Capital Bank that eventually culminated in the establishment of the collapsed Sovereign Bank. From the foregoing, there is no gainsaying the fact that, there is more to this transaction than meets the eye.

“Members of the media, the above damning revelations must be a matter of concern for every Ghanaian. The National Health Insurance scheme, which was meant to be a safety net to cushion our people in terms of their healthcare needs is on the verge of collapse due to the mismanagement and recklessness of the Akufo-Addo government. The situation has gotten so bad that currently Service Providers are being chased away from their hospitals by unpaid suppliers and poor NHIS cardholders are being turned away from hospitals including government facilities. We must therefore unite in condemning this flagrant abuse of the scheme. The NDC will not renege on our responsibility of holding this government accountable for their mismanagement of the NHIS and the health sector as a whole.”

However, Mr Hadzide told journalists on Tuesday, 16 April 2019 that “investments into private financial house, All Time Capital Limited by the NHIA were started by the Mahama-led Administration in 2012”.

“In fact, the placement of the first 5 million Ghana cedis in a 365-day fixed deposit investment occurred on 26th July 2012. The NDC continued to roll over principal plus interest accrued and even made further investment with same All Time Capital Limited,” he said.

He continued: “For the NDC to turn around and accuse the current administration that ‘the NHIS, without due diligence and with indecent haste transferred a whopping 17,548,377.20 in three tranches to a private financial house – All Time Capital Limited, supposedly as investment’, is incredibly mischievous and unbecoming of a political party seeking the mandate of the people. This further deepens the credibility crises that the NDC suffers”.

Below is the full rebuttal of government:

PRESS CONFERENCE BY GOVERNMENT.
Addressed by Hon. Pius Enam Hadzide
Deputy Minister of Information.

16/04/2019

RE: THE NATIONAL HEALTH INSURANCE SCHEME IS FAST COLLAPSING UNDER THE AKUFO-ADDO GOVERNMENT

Introduction

Ladies and gentlemen

Good afternoon and thank you for joining us for this press conference. We have invited you here today to formally respond to and clarify some issues on the National Health insurance Scheme that were raised during a press conference held by the opposition NDC yesterday.

At the said event the NDC indicated that the NHIS is fast collapsing but we want to again emphasize, as indicated by the President, His Excellency Nana Addo Danquah Akufo-Addo, at his recent state of the Nation address as well as his engagement with Ghanaians living in the USA, that the NHIS is buoyant and has come back to life with all the logistical and funding support by this government. The President didn’t peddle untruth and the President certainly doesn’t lie as the NDC would want the good people of Ghana to believe.

Government wishes to assure the people of Ghana that the NHIS is definitely not on the verge of collapse as claimed by the NDC

Let us now clear specific misrepresentations put forward by the NDC and present you with the true state of affairs with regards to NHIS funds

NHIS indebtedness

The government wishes to state emphatically that this administration inherited a 1.2 billion Cedis debt left behind by the NDC. This debt has since been fully paid by the Nana Addo-led government.

The NDC also clearly confuses funding gap of 425.7 million Cedis with total claims arrears of 1.2 billion Cedis as at December 2016 when they were exiting office.

For their education, funding gap is the difference between the total liability and the money that is due the NHIS.

Alleged Loss of confidence in the scheme

It is also palpable falsehood when the NDC says there is loss of confidence in the scheme. Contrary to their assertion, the facts is that NHIS membership registration has rather surged from 18.6 million in 2016 to 20.1 million in 2018.

Again it is also important to state that the scheme records approximately 75,000 mobile renewals weekly.

Furthermore the number of credentialed facilities (healthcare providers who have signed contracts to attend registered NHIS members) has increased from 4,160 at the end of December 2016 to 4,520.

For the records, we wish to announce that active membership of the scheme by January 2019 stands at 10,793,456 higher than the 2019 figure quoted by the NDC.

Government wants to once again bring to the attention of the general public that effective April 1st 2019 the service tariff payable to credential institutions has been increased by twenty percentage points. This is to help improve on the quality of service rendered to members.

Ladies and gentlemen, how can these statistics provided be described as loss of confidence in the scheme.

Increasing expenditure

Ladies and gentlemen

The NDC relies on budget estimates to make argument of increasing expenditure on compensation. This is obviously misleading and in bad faith.

It should be noted that as a growing institution, the NHIA takes cognisance of the creation of six new regions. It should be noted that the NHIA has offices in only 175 out of the 216 Political districts.

In order to better serve the people of Ghana in the remaining 20 percent of districts, any forward thinking institution will plan for the creation and staffing of offices in those areas in accordance with the cash flow situation of the scheme within the year. That accounts for the current budget estimates on compensation.

To pick on this and allege wrong-doing on the part of the NHIA can only be an act of mischief on the part of the NDC.

Misapplication of the NHIA Funds

Public funds are fungible.

Government applies its resources according to its planned activities captured in a budget statement and approved as appropriation by parliament. The 2018 budget clearly stated that the funding source of the Nursing Training Allowance amounting to 311.98 million cedis was to come from the statutory fund at the Ministry of Health. (Appendix 6- Policy Initiatives/Priority Programmes and alignment to statutory funds) refers.

How an expenditure captured in a budget statement and duly approved by parliament becomes misapplication can only be explained by the NDC.

Scandalous Revelation- supposed investment with “All Time Capital Limited”

Ladies and gentlemen

It is also critical to clarify matters relating to the so-called scandalous revelation on some investments with All Time Capital Limited.

It will interest you to note that the investments into private financial house, All Time Capital Limited by the NHIA were started by the Mahama-led Administration in 2012.

In fact, the placement of the first 5 million Ghana cedis in a 365-day fixed deposit investment occurred on 26th July 2012. The NDC continued to roll over principal plus interest accrued and even made further investment with same All Time Capital Limited.

For the NDC to turn around and accuse the current administration, that “the NHIS without due diligence and with indecent haste transferred a whopping 17,548,377.20 in three tranches to a private financial house – All Time Capital limited, supposedly as investment” is incredibly mischievous and unbecoming of a political party seeking the mandate of the people. This further deepens the credibility crises that the NDC suffers.

Conclusion

Ladies and gentlemen

From the above explanations, it is clear that the NDC sought to peddle falsehoods with the sole intent to misinform Ghanaians.

The NDC and its leadership continue to suffer credibility crisis on several matters and cannot be trusted.

We will urge the good people of this country to support and cooperate with this government while we provide quality and affordable healthcare to Ghanaians.

Thank you all.

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