• Zimbabwe’s Health Funding Gap Health allocations averaged 10.4% between 2019 and 2025, falling 4.6 percentage points below the Abuja Declaration’s 15% benchmark
• Budget Execution Raises Concerns Health accounted for just 7.1% of government expenditure in the first half of 2025, with 82% of sector spending directed towards salaries and wages
• National Health Insurance Faces Fiscal Test With approximately 87% of Zimbabweans lacking medical aid, the proposed June 2026 NHI launch will depend on sustainable financing, stronger healthcare infrastructure and effective fund management

Harare-Zimbabwe's plan to introduce National Health Insurance (NHI) in June 2026 is emerging against a difficult fiscal record. Between 2019 and 2025, the country repeatedly allocated less than the 15% of government expenditure committed to healthcare under the Abuja Declaration. The proposed insurance system could expand financial protection for millions of Zimbabweans, but its viability will depend on whether Treasury can sustain funding, improve budget execution and strengthen public health facilities.

Zimbabwe faces a substantial healthcare financing challenge, with only 13% of its population covered by medical aid and the remaining 87% lacking formal health insurance. Access to healthcare often comes at a considerable financial cost, as households must cover consultations, medicines, laboratory tests and hospital treatment directly. These costs can absorb savings, reduce spending on food and education, and push financially vulnerable families into debt.

The Ministry of Health and Child Care has identified NHI as an important component of the country's universal health coverage ambitions. Health Minister Dr Douglas Mombeshora has indicated that the proposed scheme is intended to reduce financial barriers to essential medical services. The central economic question is whether Zimbabwe can develop a sufficiently large and predictable financing pool to deliver those benefits.

Zimbabwe's historical budget allocations illustrate the scale of the challenge. According to the Community Working Group on Health, the health sector received 7% of government expenditure in 2019, rising to 10.1% in 2020 and 13% in 2021. The increase during the COVID-19 period demonstrated the capacity to reprioritise health spending when public health pressures intensified.

That momentum subsequently weakened. Health allocations declined to 10.6% in 2022, recovered modestly to 11.2% in 2023 and returned to 10.6% in 2024. The 2025 Mid-Year Budget Review placed the health allocation at approximately 10.1% of the national budget.

Across these seven observations, the average allocation was approximately 10.4%, or 4.6 percentage points below the Abuja commitment. None of the seven years reached 15%.

The 2025 allocation of ZiG27.8 billion against a national budget of ZiG276.4 billion illustrates the fiscal implications. Meeting a 15% benchmark on the same budget envelope would require approximately ZiG41.5 billion for health, representing an indicative allocation gap of ZiG13.7 billion.

This calculation assumes that the entire 15% target is measured against the same expenditure base and that resources can be reallocated without changing the overall budget. It is therefore a benchmark comparison rather than a direct estimate of the additional cash immediately available to the health system.

The sustained shortfall raises questions about the capacity to finance an insurance arrangement that would increase demand for healthcare services.

Budget allocations provide only part of the picture. Actual expenditure determines whether hospitals receive medicines, clinics maintain diagnostic services and health workers have the resources necessary to treat patients.

During the first half of 2025, government health expenditure amounted to approximately ZiG7 billion, equivalent to 7.1% of total public spending over the period. This was considerably below the Abuja benchmark and the sector's annual allocation share.

The composition of spending is equally important. Approximately ZiG5.7 billion, or 82% of first-half health expenditure, went towards salaries and wages. Around ZiG1.1 billion financed goods and services, while capital expenditure accounted for roughly ZiG200 million.

These figures highlight the limited resources reaching equipment procurement, infrastructure development and other non-wage requirements during the period.

Health insurance can reduce the financial burden on patients, but its effectiveness depends on the availability of services. A patient whose consultation is covered still requires functioning diagnostic equipment, available medicines and trained medical personnel.

The distinction matters particularly in rural districts, where distances to healthcare facilities and shortages of specialist services can increase the economic cost of treatment.

The proposed NHI model is expected to rely on pooled financing, potentially drawing on earmarked taxes and other domestic revenue sources.

Zimbabwe already has experience with health-related levies, including the AIDS Levy, while taxes on selected products and services have been considered as mechanisms for supporting healthcare expenditure.

Pooling resources can improve financial protection by distributing medical costs across a broader population. However, revenue adequacy, predictability and the structure of contributions will determine the scheme's sustainability.

Zimbabwe's large informal economy presents a particular challenge. Conventional insurance systems often rely on regular payroll contributions, which are easier to collect from formally employed workers. Extending coverage to informal traders, smallholder farmers and unemployed households requires a different financing arrangement.

A scheme that depends heavily on individual contributions could struggle to reach precisely the households facing the greatest financial barriers. Public subsidies and clearly defined eligibility arrangements will therefore be essential to achieving broad coverage.

Revenue collection also needs to be matched with expenditure controls. Without effective purchasing systems, provider accreditation and claims verification, additional financing could be absorbed by administrative costs and inefficient procurement.

Zimbabwe's healthcare financing challenge has become more pressing as international development assistance faces growing uncertainty.

External partners have historically supported major health programmes, particularly HIV, tuberculosis and malaria services. The reduction or disruption of external assistance creates pressure on domestic financing at a time when government resources are already constrained.

The economic consequences extend beyond individual health outcomes. Interruptions to treatment can increase future healthcare costs, reduce labour productivity and place additional financial pressure on households.

Sustainable domestic financing is therefore central to protecting earlier public health gains.

However, replacing external support requires more than introducing new taxes. Treasury must assess the stability of each revenue source, the administrative costs of collection and the extent to which earmarked funds genuinely increase total health spending.

If dedicated health revenues merely substitute for existing Treasury allocations, the overall resource envelope may remain unchanged.

Private medical aid societies, hospitals, laboratories and pharmaceutical suppliers are likely to play an important role in the development of NHI.

Their participation could expand service capacity, improve claims administration and support investment in medical technology. Contracting arrangements could also create opportunities for private providers to serve patients who previously depended entirely on public facilities.

The design of these relationships will require careful regulation.

Provider reimbursement rates must be sufficient to sustain service delivery while protecting the insurance fund from excessive costs. Accreditation standards should establish minimum requirements for quality, reporting and patient safety.

There is also a risk that providers could concentrate on better-funded urban markets, leaving rural communities dependent on under-resourced facilities.

Purchasing arrangements should therefore reward service availability and quality in underserved areas rather than simply increasing payments to existing providers.

For investors, the proposed scheme could create demand for healthcare infrastructure, pharmaceuticals, diagnostics and digital claims systems. The scale of those opportunities will depend on the fund's actual purchasing capacity and payment reliability.

Zimbabwe has recorded improvements in important health indicators, including reductions in maternal mortality and gains in life expectancy. Nevertheless, preventable deaths and inequalities in access to care remain significant challenges.

Insurance coverage is one component of the broader healthcare system. Maternal health outcomes, for example, depend on access to antenatal services, skilled birth attendants, emergency transport and functioning referral hospitals.

Neonatal healthcare similarly requires appropriately equipped facilities and timely clinical intervention.

A financing reform that expands demand without increasing service capacity could produce longer waiting times and greater pressure on public hospitals.

Implementation should therefore be coordinated with investment in essential medicines, healthcare workers, rural infrastructure, electricity and water supply.

These investments have wider economic benefits. Better health outcomes can improve labour participation, reduce household vulnerability and support human capital development.

The proposed National Health Insurance Bill is expected to establish the legal and institutional arrangements governing the scheme.

The framework will need to define revenue collection, eligibility, benefit packages, provider payments and financial accountability.

An independently audited fund, transparent procurement systems and regular publication of financial performance would strengthen confidence among contributors, healthcare providers and development partners.

Public reporting should distinguish between funds collected, claims paid, administrative expenditure and outstanding obligations.

These indicators would allow policymakers to assess whether financing is reaching healthcare providers and whether the scheme is maintaining sufficient reserves to meet future commitments.

Payment delays would create additional risks, particularly for smaller clinics and pharmaceutical suppliers operating with limited working capital.

Zimbabwe's proposed NHI presents an opportunity to reduce the financial risks associated with illness and improve access to essential healthcare. The historical funding record demonstrates the importance of approaching implementation with credible fiscal assumptions. Health allocations remained below the Abuja benchmark throughout 2019–2025, while first-half expenditure in 2025 revealed additional weaknesses in budget execution and non-wage financing.

A successful scheme will require predictable revenue, transparent administration and investment in the facilities responsible for delivering treatment.The immediate priority should be to establish a realistic financing framework, define an affordable initial benefit package and strengthen the capacity of public and contracted providers.

The success of the NHI will ultimately be measured by improved access to affordable medical treatment, supported by a financially sustainable healthcare system that delivers measurable improvements in health outcomes and advances Zimbabwe’s commitment to universal health coverage.

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