The healthcare industry as a driver of national competitiveness, By Dipo Baruwa

Background

The Nigerian healthcare service delivery industry holds immense potential but remains underdeveloped, underutilised, inadequately resourced, and overstretched. Despite a rapidly growing population, demand for medical services continues to outpace supply. The system suffers from outdated equipment, weak infrastructure, and a dangerously high patient-to-doctor ratio of 1:5,000, far above the WHO recommendation of 1:600. Insurance coverage is alarmingly low, with fewer than 5 per cent of Nigerians enrolled, forcing over 70 per cent of health expenditure to be paid out-of-pocket.

These weaknesses fuel poor access to care, medical brain drain, with over 2,000 doctors emigrating annually, and rising medical tourism, draining an estimated $1 billion yearly. Reliance on public-sector-driven healthcare has proven insufficient, highlighting the need for a new model that mobilises private sector capacity for sustainable, competitive, and efficient healthcare delivery.

Healthcare isn’t just a social good but a strategic pillar of business competitiveness and sovereignty. Yet, despite government recognition of the private sector’s vital role in development, policies have not gone far enough in creating an enabling environment for private participation. As Nigeria shifts toward a more pragmatic, market-oriented governance framework, there is an urgent need to institutionalise a paradigm shift in healthcare policy – one that embeds sovereignty, competitiveness, and private sector partnership at its core.

The Private Sector’s Footprint in Nigeria’s Healthcare Sector

The private sector already delivers over 60 per cent of healthcare services in Nigeria. From small clinics to major hospitals, pharmaceutical manufacturers, and emerging health-tech platforms, private operators are raising standards in infrastructure, technology, and specialist services. However, their footprint remains fragmented, concentrated in urban areas, and often inaccessible to rural and low-income populations.

• Hospitals and Specialist Centres: Institutions such as The Reddington Group, Duchess Hospital, Lagoon Hospitals, and Kelina Hospital showcase advanced diagnostics and specialist services in cardiology, oncology, neurology, and minimally invasive surgeries.
• Health-Tech and Digital Solutions: Firms like Helium Health digitise health records, while platforms such as Doctoora and Reliance HMO expand telemedicine and affordable insurance.
• Pharmaceutical Manufacturing: Companies including Emzor, May & Baker, Fidson, and Greenlife Pharmaceuticals are scaling local production, reducing reliance on imports, and strengthening supply chain resilience.
• Insurance and Risk Pools: Providers such as AXA Mansard, Hygeia, and micro-insurers offer affordable packages, though penetration remains very low without stronger policy support.

This private sector presence underscores untapped potential, which policy reform can unlock.

Enabling the Private Sector: Creating the Right Environment

For the private sector to drive universal healthcare sovereignty, the government must move from intent to decisive action. Priority areas include:

1. Regulatory Bottlenecks: Licensing and medical equipment importation are delayed by lengthy, multi-layered approvals, discouraging investment. Streamlined, transparent processes are essential. The Healthcare Federation of Nigeria, in partnership with the Nigerian Investment Promotion Commission and the IFC, developed a policy prescribing reforms for service registration and equipment importation. However, implementation has been slow, and regulatory inertia persists.
2. Financing Constraints: Access to credit remains a major barrier, with healthcare investors facing interest rates above 20 per cent. Long-term, single-digit credit, tax breaks on critical inputs, and blended finance facilities are needed. Just as agriculture attracts subsidies and dedicated funds for food security, healthcare — central to sovereignty — requires similar incentives. With the rise of lifestyle-related ailments linked to non-organic diets, subsidies and targeted financing are more critical than ever.
3. Weak Public-Private Partnership (PPP) Frameworks: Though promoted as a strategy, PPPs in healthcare are limited. The Garki Hospital concession in Abuja demonstrated the benefits of private management — modern diagnostics, improved delivery, and affordability — but also exposed gaps in sustainability and transparency. Scaling such models under enforceable, transparent contracts across hospitals, laboratories, and supply chains would attract significant investment.
4. Insurance Coverage and Risk Pooling: Fewer than 5 per cent of Nigerians are insured, a challenge worsened by difficulties tracking enrollees in an informal economy. Current reforms around the National Identity Number (NIN) present opportunities to expand coverage, reduce fraud, and strengthen risk pooling. Reinsurance schemes and matching grants could incentivise insurers to design affordable packages for low-income workers.

The National Health Insurance Authority (NHIA) and National Social Insurance Trust Fund (NSITF) must integrate efforts. By sharing data and aligning incentives, their combined social protection and insurance mandates could deepen inclusion and reduce catastrophic out-of-pocket expenses.

5. Infrastructure and Logistics Gaps: Weak power supply, absence of cold chain facilities at ports, and poor rural infrastructure increase costs. Policies such as land concessions, infrastructure subsidies, and public guarantees would stimulate private investment. Executive Order 7 (2019), originally focused on road infrastructure, should be expanded to cover hospitals and health facilities, especially in underserved areas.
6. Workforce Challenges: The exodus of doctors and nurses undermines national capacity. Retention demands improved remuneration, funded residency slots, and diaspora return incentives. Private sector partnerships can expand training and provide opportunities, but the government must ensure the right policy framework to make retention viable.

Conclusion

For Nigeria to achieve universal healthcare sovereignty, rhetoric must give way to action. The private sector’s footprint shows strong potential, but systemic barriers limit its scale and impact. By integrating NHIA, NSITF, and private insurers, strengthening PPP frameworks, streamlining regulations, and enabling affordable finance, Nigeria can expand healthcare coverage and efficiency.

Healthcare, therefore, must be redefined not just as a social service but as a strategic pillar of business competitiveness and national sovereignty. A paradigm shift in policy and implementation is overdue – one that anchors healthcare at the heart of Nigeria’s competitiveness and resilience.

Dipo Baruwa is a business climate development analyst.