Lagos targets ₦400bn annual health financing through insurance coverage

The Lagos State Government says it can generate over ₦400 billion annually for healthcare financing if at least 20 million residents enroll in the state’s health insurance scheme.

Commissioner for Health, Prof. Akin Abayomi, disclosed this at the inauguration of the Lagos Private Health Partnership (LPHP)—a major reform designed to overhaul health financing, expand insurance coverage, and guarantee equitable access to quality care through a unified public–private collaboration framework.

Abayomi explained that the ₦400 billion projection is based on an average annual premium of ₦20,000 per enrollee.

He warned that Lagos cannot build a functional, people-centered insurance ecosystem without mass enrollment.

Despite its economic strength and population of over 25 million, the commissioner noted that the state still grapples with poor health financing, low insurance penetration, medical brain drain, and rising medical tourism.

According to him, LPHP seeks to correct these gaps by creating a transparent, value-driven procurement and service delivery system.

The initiative marks a shift away from a decade of fragmented private insurance operations, price undercutting, and widespread enrollee dissatisfaction.

Lagos currently implements compulsory health insurance through the Lagos State Health Scheme (LSHS), known as Ìlera Èkó, made mandatory by an Executive Order signed by Governor Babajide Sanwo-Olu in July 2024. Full enforcement is expected after a six-month sensitisation period.

Abayomi said LPHP will run on a robust digital marketplace covering enrolment, provider selection, fund flow, claims management, monitoring, and compliance.

He added that private insurers will contribute 13% of premiums to a state-managed risk equalisation and solidarity fund to protect vulnerable groups and support emergency response.

Governor Sanwo-Olu, represented by Secretary to the State Government Mrs. Abimbola Salu-Hundeyin, described LPHP as a historic step toward a resilient health financing system capable of shielding households from catastrophic medical costs.

He said the initiative aligns with the state’s domestication of the NHIA Act (2022) and will strengthen private healthcare providers, who deliver over 70% of care in Lagos.

Chairman of the Lagos State Health Management Agency, Dr. Adebayo Adedewe, hailed LPHP as a sustainable solution to long-standing insurance challenges. Similarly, Dr. Jimi Arigbabuwo, National Adviser on Health Insurance for the Healthcare Providers Association of Nigeria, said the reform marks a significant advancement in integrating private sector providers into the state’s health system.

He urged government to ensure fair compensation to maintain quality services and reduce medical tourism.