Ghana's growing middle class presents opportunities in private health care


Public health services dominate Ghana’s health care sector. The Ghana Health Service (GHS) – an independent executive agency responsible for the implementation of health policies – reports that 78.7% of the 7089 hospital beds in 2016 were managed by the government and 16.9% by the private sector. The remaining 4.4% of hospital beds were managed by faith-based and quasi-government organisations.

Meanwhile, demand for private care is growing, along with the middle class, opening up opportunities for private product and service development. In addition, the provision of health insurance, as well as the import, distribution and production of pharmaceuticals, are segments seeing rising interest from businesses. However, high import tariffs, a shortage of skilled staff and cost-related pressures continue to impact the sector’s overall performance.

Oversight & Universal Cover

The health care industry is overseen by the Ministry of Health (MoH) and its satellite agencies, including the GHS. Established in 1996, the GHS administers health services throughout the network of hospitals and other medical facilities. The Private Hospitals and Maternity Homes Board, which also falls under the purview of the MoH, registers and licenses all private hospitals.

The core responsibility of the National Health Insurance Authority (NHIA) is to administer the National Health Insurance Scheme (NHIS) – a social welfare programme launched in 2004 to replace the cash-andcarry method of paying for health care that previously operated in Ghana. Prior to the launch of the NHIS, patients had to pay cash upfront before receiving services at hospitals. The NHIS is predominantly funded by the National Health Insurance Levy, which is a 2.5% levy on goods and services collected under value-added tax, as well as by income tax contributions, which vary by level of income, and annual allocations from Parliament. The NHIA sets the minimum contributions to the NHIS in consultation with the minister of health and receives, processes and pays all claims for health services delivered under the scheme. The goal of the NHIS at its inception was to achieve universal coverage by 2009. However, the national coverage rate for the scheme in 2017 was 41%, or roughly 11m individuals.

Room to Improve

While the NHIS has increased coverage rates and is hailed as an example to be emulated in West Africa, there have been calls for reform. Some of the programme’s issues are unaffordable annual fees for the poorest enrollees, insufficient care, a lack of medicines, its expenses outpacing revenues, and time-consuming registration procedures.

Of particular concern to private health care providers are delays in the settlement of payment claims. Speaking to local media in mid-2018, Kojo Asante, a research fellow with the Ghana Centre for Democratic Development, explained how it can take the NHIS up to 12 months to settle payment claims to service providers. If this trend continues and public health financing is not improved, he warned, vulnerable individuals may eventually have to pay cash for medical care. “The whole reason why we had the NHIS was to move from cash and carry, but once you have the NHIS struggling to pay its service providers, then they have to pay out of pocket and the trend is that, for a period, we were seeing an increase in out-ofpocket payments because the NHIS was under such dire stress,” Asante said.

The NHIA is also the country’s regulator for the private insurance segment. In this capacity it licenses all insurance providers and contributes to relevant policy formulation on health insurance. As of December 2018 there were 13 registered coverage providers coverage, with the newest player, Ace Medical Insurance, entering the market in 2018. Businesses are required to hold a minimum of $1.5m in capital to establish insurance operations (see Insurance chapter).


Ghana struggles to train and retain an adequate number of health professionals. According to the GHS, there were 3365 doctors employed in 2016. Despite the shortage, the doctor-to-patient ratio in Ghana steadily improved in the 2011-16 period, from one doctor per 10,209 people in 2011 to one doctor per 8481 in 2016. While there was a 36% increase in the number of doctors working in the country, the number of qualified medical professionals remains below what is required to meet service demand and is viewed as a constraint to sector development.

The World Health Organisation (WHO) recommends that the national nurse-to-patient ratio is 40 nurses per 10,000 people; however, as of 2016 that ratio in Ghana was 22 nurses per 10,000 people. Paradoxically, the country has struggled in recent years to absorb nursing graduates into the workforce. This suggests that, in addition to boosting the number of medical practitioners, there is a need to bring training and health education in line with industry demands.

Public Spending

The government recognises this and is also prioritising reforming the NHIS and reducing the cost of medications. To fund these goals, in its 2019 national budget, the government allocated GHS6bn ($1.3bn) to the MoH, an increase of 37% over the 2018 allocation and 8% of the total government budget. Some of this money has been earmarked for funding the development of a national hospital strategy, which is designed to improve the quality of services by appropriately classifying all hospitals. The budget will also provide capital for the construction of a new district hospital and five polyclinics in the Western Region, and the construction of 15 community health planning service facilities in five other regions.

Digitising Rural Health Care

In February 2018 the GHS launched e-Tracker, an app that enables service providers to register and track clients using mobile devices and community health care workers operating in remote areas to electronic record keeping. The e-Tracker project was delivered in partnership with the US Agency for International Development (USAID), the Korean International Cooperation Agency, the non-governmental organisations Evaluate for Health and Good Neighbours, and electronics company Samsung. The project was initially rolled out in the Upper East, Eastern and Volta regions, where over 2500 tablets were distributed to health workers. The e-Tracker enables rural health workers to immediately record and analyse patient information and is part of a broader government-led institutional reform intended to improve health outcomes and data management.

Private Facilities

The development of the private health sector in Ghana is guided by the Private Health Sector Development Policy, which was published by the MoH in 2013. The overarching objective of this policy is to make the private sector more viable by focusing on four main objectives: improving the investment climate for private health sector growth, supporting the transformation of private health facilities to meet industry expectations, building the capacity of private health care providers and increasing medical access for the poor. It proposes a legislative focus on foreign investment and more market-driven interventions.

In addition to the state’s focus on private-sector development, factors stimulating private-sector growth in Ghana’s health sector include changing consumer preferences driven by urbanisation, a growing middle class and technological advancement.

Drawn towards expanding populations with extra income, private facilities have largely become concentrated in urban areas. The majority of private hospitals are in Accra, where 35% of the country’s 1199 private hospital beds were located in 2016. There is also a high concentration in the Ashanti Region, which hosted 20% of all private hospital beds, as well as in the Western Region, which held 12% of all beds.

The growing use of new technology across the sector has created opportunities for private companies providing ancillary health services such as physiotherapy and radiology. Technology has also been effectively leveraged to increase the quality of teaching and research. “Ghana is making great strides when it comes to standards and technology,” Dr Edem Hiadzi, CEO of Lister Hospital, told OBG. “Much of this is has been driven by the urge to deal with medical issues locally and become a regional hub.”

Non-Communicable Diseases

In Ghana 31% of the national disease burden and 90,000 deaths annually are attributed to non-communicable diseases (NCDs) such as cancer, hypertension and diabetes. According to the Ghana-based, non-profit Institute of Leadership Development (INSLA), 56% of such deaths in 2017 were individuals under the age of 70. INSLA also found the prevalence of NCDs in Ghana is increasing due to unhealthy diets and other lifestyle factors. A 2018 study by Kwame Nkrumah University of Science and Technology and the University of Western Cape found 43% of adults were either overweight or obese.

In 2018 the government initiated a plan to develop a national framework to address the growing incidence of NCDs called the National Health Diet Policy. The framework incorporated global recommendations, including those from the WHO, and the government’s own existing policies, such as the Ghana Shared Growth and Development Agenda 2010-17, the National Health Sector Medium Term Development Plan, and the Disease Control Strategy 2010-14. The objective of the new government framework is to reduce premature mortality from NCDs through prevention and treatment by one-third through to 2030.


While imported pharmaceuticals account for 70% of all drugs used in Ghana, the country is working to position itself as a medicinal manufacturing centre. According to a report by the University of Ghana Business School, “the local industry has an installed capacity for both solid and liquid dosage forms to supply all domestic needs as well as enough for export. There is, however, persistent under-utilisation of existing capacity – less than 55% on average – as a result of inadequate resources”. The report also estimated that the local industry was on track to reach $1bn in value by the end of 2018, but noted it was constrained by absences of strategic focus, support and expertise.

The government has implemented a series of initiatives in a bid to spur growth in the domestic pharmaceutical market. In 2017 the legislature approved a 30% reduction in tariffs on pharmaceutical inputs, such as active ingredients, bottles, caps and drug information leaflets. The reduction in tariffs on inputs was designed to encourage local production and ultimately reduce the price paid by the consumer.

The government is also advocating for regional integration around pharmaceutical imports within ECOWAS and the development of a regional shared pharmaceutical register that harmonises requirements across all countries in the region, making it easier for pharmaceutical companies to trade across borders in a potentially expanded market.

The largest purchaser of pharmaceutical products is the government, as it is the primary provider of health care services, and it is not immune to the high costs of health care. For example, when the New Patriotic Party (NPP) government of President Nana Akufo-Addo took over in January 2017, the NHIS was indebted GHS1.2bn ($259.3m) to suppliers and pharmaceutical companies.

In March 2018 the government paid off much of the debt, leaving GHS181m ($39.1m) outstanding. At the same time, the state submitted proposals aimed at strengthening public health facility management to cut waste and overhead costs.


Ghana’s economic development is leading to heightened demand for specialised private health services, while on the public side, the government has made commitments to improve universal health coverage and is implementing plans to tackle specific challenges such as non-communicable diseases and a shortage of health professionals. Such commitments to legal reform and public resource provision will help spur further investment; however, challenges remain, including weaknesses in the NHIS and high pharmaceutical and health care costs, all of which tend to have the greatest impact on low-income citizens.


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The Report: Ghana 2019

Health & Education chapter from The Report: Ghana 2019

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The Report

This article is from the Health & Education chapter of The Report: Ghana 2019. Explore other chapters from this report.

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