Indonesia: Supplying Universal Health Insurance to a Large Population

Indonesia, the fourth most populous country in the world, holds big ambitions in the improvement of health for its citizens. Robust public health initiatives based on universal health insurance coverage can highly influence the future development of the consumer health industry in Indonesia. Euromonitor International takes a look at current events shaping a renewed “healthy” country.

The goal is public health

The Indonesian government aims to provide universal health coverage to all population of its 237.6 million according to the 2010 Indonesia Census. To achieve this goal, in 2008 the government introduced “Jamkesmas”, a new health insurance plan that is an extension of the previous plan known as “Askeskin”, established under the National Social Security System Law of 2004 (SJSN Law). Other health insurance plans include “Jamsostek” for employees working for private companies, “Askes” for government workers, and “Asabri” for military personnel.

According to the government the main priorities of health developments for the 2010-2014 period include the improvement of maternal and paediatric health, the control of communicable and non-communicable diseases, the development of self-care initiatives via the assignment of healthcare practitioners to underserved regions (health manpower), the creation of affordable and safe medicines, the further development of Jamkesmas universal health coverage, and the implementation of additional health services.

The problem with previous health insurance plans was a limited number of health centres (puskesmas), poor quality treatments, and limited coverage leading people to pay a large sum for out-of-pocket expenses. Public health expenditure as a percentage of total health expenditure was 62% in 2010 according to Euromonitor International.

In the quest for affordable health

The particular geography of Indonesia, formed by many islands, makes it difficult to achieve large-scale consistent universal healthcare coverage across the population. Self-care is one of the pivotal initiatives to help people in remote and rural areas to manage minor ailments, yet access to formal clinics and health practitioners remain as a challenge.

The government is actively training and giving incentives to health workers to attend to these areas and educate people on health and wellbeing. Mobile telemedicine systems (mHealth) are filling the gap for medical attention involving remote consultation, telediagnosis and a collection of patients’ information in remote areas. The geographic landscape and a fragile telecommunications structure still represent important obstacles.

Big urban areas in the islands of Java and Sumatra provide the best options to consumers in terms of medicine accessibility and healthcare centres (puskesmas). Local pharmacies, “apotik”, are usually small independent operators. Only a few chains exist such as Kimia Farma (Persero) Tbk PT, Guardian (Dairy Farm International Holdings Ltd), K-24 Indonesia PT, and Century Healthcare (Perintis Pelayanan Paripurna PT) in the largest urban areas. Apotik Melawai is a popular private local chain in Jakarta, while other pharmacies are owned by the government.

New opportunities ahead

The need for affordable medicines to promote self-care will be supported as long as the Indonesian government continues to make an important push on universal health benefits for its people. One of the pending challenges to address is how the government will pay for future healthcare costs under the universal health insurance plan. Self-care initiatives via consumer education can become a solution in the treatment of minor ailments, while leaving serious or more complicated conditions to the attention of healthcare providers.

Many benefits can be expected if the government fosters comprehensive self-care initiatives and supports both local and international companies in the approval and launch of new affordable medicines. International companies wishing to expand their operations in Indonesia can find good opportunities via the establishment of partnerships and joint ventures with local firms.

Local expertise, good relationships with the government, and a clear understanding of the Indonesian culture can become an asset to expand sales in the fourth most populous country in the world.