Insurance, Health Insurance, NHIA & Public Schemes October 14 2026 | 38 mins read

NHIS and the NHIA Act 2022 Explained: What Mandatory Health Insurance Means for You (2026 Guide)

Introduction

The National Health Insurance Scheme (NHIS) that most Nigerians grew up hearing about no longer exists as a separate institution. It was repealed and replaced in May 2022 by the National Health Insurance Authority (NHIA) Act, Act No. 17 of 2022, signed into law on 19 May 2022 and gazetted six days later.

The new law does two things that matter to every household. It creates a stronger regulator, the National Health Insurance Authority, and it makes health insurance mandatory for every person resident in Nigeria. This guide explains what the law actually says, who is now required to have cover, what employers must do, what happens if you do nothing, and how to compare the plans available to you in 2026.

What the law says

Section 14 of the National Health Insurance Authority Act 2022 states that every person resident in Nigeria is required to obtain health insurance. The obligation covers Nigerian citizens and legal residents, salary earners and the self-employed, and every employer with five or more staff.

Why the Old NHIS Was Replaced

The National Health Insurance Scheme was established in 1999 and formally launched in 2005 under Cap. N42, Laws of the Federation of Nigeria, 2004. It was designed as a voluntary scheme aimed largely at federal civil servants and formal-sector employees. Two decades later, coverage had barely moved beyond that original base. Estimates published around the passage of the new Act suggested that formal health insurance still reached only a single-digit percentage of the population, with the vast majority of Nigerians paying medical bills straight out of pocket at the point of care.

Three structural problems drove the reform. First, the NHIS could recommend but not require enrolment, which limited its reach in the informal sector where most Nigerians earn a living. Second, coordination between the federal scheme and the state health insurance agencies that began to emerge from around 2015 was weak, leaving overlapping mandates and unclear accountability. Third, the regulator sat inside the same institution that was expected to grow the market, blurring the line between running schemes and supervising them.

The National Health Insurance Authority Act, 2022 responds to those three problems directly. It repeals the 2004 NHIS Act in full, creates a new corporate body with clearer regulatory teeth, requires participation from every resident, and formalises the relationship between the federal Authority and state health insurance schemes.

What the NHIA Act 2022 Actually Says

The Act is organised into ten Parts and 60 sections. Four of those sections do most of the practical work for ordinary readers.

Sections 1 to 3: The Authority and its powers

Section 1 establishes the National Health Insurance Authority as a body corporate with perpetual succession. Section 2 sets out its objects: to promote, regulate and integrate health insurance schemes, to harness private sector participation, and to assist in achieving Universal Health Coverage for all Nigerians.

Section 3 lists the Authority’s functions, and this is where the new powers become visible. The Authority is required to promote, integrate and regulate all health insurance schemes operating in Nigeria, to enforce the basic minimum package across every scheme (federal, state, FCT and private), to accredit and monitor Health Maintenance Organisations, Mutual Health Associations, Third-Party Administrators and Health Care Facilities, and to accredit insurance companies, insurance brokers and banks that want to participate in health insurance under the Authority.

The Authority is not the Ministry of Health. It reports to the Minister of Health for policy directives (Section 12), but its regulatory decisions on accreditation, licensing, tariffs and sanctions are its own.

Section 14: The mandate

Section 14 is the sentence that changes everything for individuals. Subsection (1) states that, subject to the Act, every person resident in Nigeria shall be required to obtain health insurance. Subsection (2) then defines residents to include all employers and employees in the public and private sectors with five staff and above, informal sector employees, and all other residents of Nigeria. The mandate covers Nigerian citizens and legal residents alike, and it applies whether a person is salaried, self-employed, unemployed, retired or a dependant.

Two carve-outs sit in the same section. A person may still obtain private health insurance on top of any state-mandated scheme (Section 14(3)), and a person who buys private cover is not eligible to receive free coverage as a vulnerable person under Section 13(7). In plain terms, private insurance is complementary, not a substitute for participation in the wider system, and taking a private plan removes any claim to subsidised cover.

Section 59: Who is an employer

Section 59 defines an employer as one with five or more employees, and expressly includes the Federal, State and Local Government and any extra-ministerial department. Any Nigerian business, whether a shop, an SME, a professional firm or a large corporate, that carries five or more people on its payroll therefore sits inside the mandate as an employer and must register itself and its staff, and remit contributions.

Employees themselves are defined as any person ordinarily resident in Nigeria and employed in the public or private service or in an apprenticeship, whether the contract is written, oral, express or implied. That definition catches informal apprenticeships and contract staff that would previously have fallen through the cracks of the 2004 Act.

Section 13: State health insurance schemes

Section 13 authorises every state of the federation and the Federal Capital Territory to establish and implement its own state health insurance and contributory scheme covering all residents of that state. Each state scheme must comply with the Act, use HMOs, Health Care Facilities, Mutual Health Associations and Third-Party Administrators registered by the Authority, run an integrated ICT infrastructure that talks to the Authority’s systems, and provide coverage for vulnerable persons through the Basic Health Care Provision Fund without charging premiums from those individuals. Once a state has a compliant scheme, it becomes eligible to draw from the Basic Health Care Provision Fund established under the National Health Act.

The practical effect is that the day-to-day enrolment surface for most Nigerians is a state scheme, while the Authority handles regulation, accreditation and the federal civil service scheme it runs directly under Section 13(3).

How Mandatory Enrolment Works in Practice

The law describes the destination. The route each person takes to get there depends on how they earn a living and where they live.

Salary earners in the formal sector

If you work for a Nigerian employer with five or more staff, your employer is required under Section 32 to register itself and its employees, and to pay contributions and the employer’s contribution in respect of its employees, into the account of the relevant State Social Health Scheme Fund at the time and in the manner set out in that state’s scheme laws. The employer’s share and the employee share are set by the councils of the state health insurance schemes under Section 31. For federal civil servants and certain designated groups, the Authority runs its own formal-sector scheme under Section 13(3).

What this means in practice is that most salary earners do not have to buy anything themselves in order to comply with Section 14. The employer arranges the plan, pays the employer contribution, deducts the staff share from wages, and picks an accredited Health Maintenance Organisation. The employee receives an HMO identity card and accesses care at hospitals in the HMO’s network. If your employer already offers HMO cover, you are almost certainly compliant; if the plan is thin, you can top up with a private plan under Section 14(3).

Informal sector and self-employed

If you are self-employed, run a micro-business without staff, freelance or work in the informal economy, the responsibility to enrol sits with you personally. Section 31(1)(b) provides that informal sector contributions are paid by individuals, groups and families at rates set by the councils of the various state health insurance schemes. In practice the routes available in 2026 are your state’s informal sector programme (many state schemes now run dedicated informal packages), a Group, Individual and Family Social Health Insurance Programme (GIFSHIP) plan under the NHIA, or a private HMO plan bought directly from an accredited provider.

You can hold a state scheme baseline and add a private HMO plan on top; Section 14(3) permits it, and many freelancers and small business owners do exactly that. If you want to see how the private options compare on price, network and benefits before you commit, our guide on how to compare health insurance plans in Nigeria walks through the criteria that decide value.

Vulnerable groups

Section 59 defines the vulnerable group to include children under five, pregnant women, the aged, the physically and mentally challenged, and the indigent as defined from time to time. Section 25 establishes a Vulnerable Group Fund whose sources include the Basic Health Care Provision Fund, a health insurance levy, special intervention funds, investment income and grants. Section 26 states that the Fund’s object is to subsidise or pay premiums for vulnerable persons and indigents.

If you fall into a vulnerable category, or if you are supporting a parent or child who does, you do not have to fund your own premium. State health insurance schemes are required under Section 13(7) to provide coverage for vulnerable persons through the Basic Health Care Provision Fund and other sources without collecting premiums from them.

Diaspora Nigerians and legal residents

The mandate under Section 14 applies to every person resident in Nigeria. Non-resident Nigerians in the diaspora are not automatically covered by the mandate, but they can still take out Nigerian health cover for periods spent in the country, for family members resident here, or as a supplementary plan for planned medical visits. Legal residents who are not Nigerian citizens fall inside the mandate on the same terms as Nigerian residents.

State Health Insurance Schemes and the Federal Role

The old NHIS was a single national scheme. The new architecture is deliberately federal. The Authority sits at the top, setting rules, accrediting operators, running the Basic Health Care Provision Fund and the Vulnerable Group Fund, and operating the federal civil service scheme. Each state and the FCT run their own scheme for residents of that state, using operators accredited by the Authority, with data flowing back to the federal ICT infrastructure.

By 2026, more than 30 states have stood up their own agencies, and the enrolment surface for most Nigerians in the informal sector is a state scheme rather than a federal one. Which state you live in matters, because premium bands, benefit packages, provider networks and the pace of rollout differ. Our companion guide on how each state health insurance scheme operates in Lagos, Oyo, Anambra, the FCT and beyond covers the state-by-state detail; for the pillar-level picture, the important point is that your enrolment starting point is usually your state agency or its digital portal (we also have a walkthrough of the NHIA self-service portal if you need it), not the NHIA head office in Abuja.

What You Pay: Contributions and Premiums

The Act does not fix a national premium. Section 31 leaves rate-setting to the councils of the various state health insurance schemes, both for the formal and informal sector. In practice, this means three separate cost conversations depending on your route in.

For formal sector employees, the employer contribution and employee share are set inside each state scheme’s regulations, and the total premium is typically split between the two. Federal civil service scheme rates are determined by the Authority. For most salary earners the individual out-of-pocket contribution is a small monthly deduction, and the employer picks up the larger share.

For informal sector plans through a state scheme or GIFSHIP, premiums are set per person or per family. Coordinators have publicly quoted GIFSHIP figures in the range of tens of thousands of Naira per year for an individual and a modest step-up for a family of four, though the exact figures are set by the Authority and revised from time to time. Confirm current numbers with your state agency or the NHIA before you enrol.

For private HMO plans, premiums are set by the HMO within the ranges the market will bear and reviewed annually. Retail HMO plans for individuals in Nigeria in 2026 commonly sit between the low tens of thousands of Naira and several hundred thousand Naira per year, depending on tier, hospital network and family size. Because the same headline “gold” or “premium” label can hide very different benefits, our explainer on what most Nigerians get wrong when comparing HMO plans sets out the questions that separate real cover from a good-looking brochure.

Tax relief

Section 54 of the Act provides that contributions by an employer or an employee under the Act form part of tax-deductible expenses in the computation of income tax payable. Mandatory health insurance contributions are a legitimate business or personal cost against income tax, not an after-tax expense.

What You Get: The Basic Minimum Package

Section 3(c) requires the Authority to enforce the basic minimum package of health services for all Nigerians across every scheme operating in the country, including private schemes. Section 13(2) ties the minimum scope of coverage under state schemes to the Basic Minimum Package of the National Health Act, 2014.

At a minimum, cover under a compliant scheme is expected to include primary care consultations, essential drugs on the approved list, laboratory and diagnostic tests within scope, maternity care within the plan’s stated waiting period and limits, and inpatient care within the plan’s ward and benefit limits. Referrals from primary providers to secondary and tertiary facilities are handled by the Health Maintenance Organisation under its capitation and fee-for-service arrangements with hospitals, defined in Section 34 and Section 36.

Benefits are a floor, not a ceiling

The basic minimum package is a baseline, not a limit. Waiting periods, exclusions, pre-existing condition treatment, dental and optical inclusions, chronic disease management, evacuation and out-of-network care vary widely across plans, and are set at the plan level rather than by the Act. Read the benefit schedule before enrolling, and confirm any specific need in writing. Our 2026 health insurance cost report breaks down how the cost components inside a premium translate into what you actually receive.

Penalties, Compliance and Employer Obligations

Part IX of the Act sets out offences and penalties. Section 48 lists conduct that is treated as an offence, and it applies to persons and to Health Maintenance Organisations. The list includes failing to pay the required contribution into the account of the Authority or a state health insurance fund within the specified period, deducting an employee’s contribution but withholding or refusing to remit it, failing to remit payments to health care providers within the specified period, failing to settle fee-for-service claims within the stipulated time, manipulating the enrollee register, failing to provide care to a duly registered enrollee, and issuing a dud cheque.

For the specific offence of issuing a dud cheque, Section 48(2) sets fines of at least ₦1,000,000 or imprisonment for up to two years for first offenders, and at least ₦2,000,000 or up to five years for repeat offenders, or both fine and imprisonment. Section 22(2) attaches a fine of at least ₦2,000,000 or imprisonment of at least five years, or both, for operating under a name that suggests you run a health insurance scheme when you are not registered and licensed. Section 44(3) allows fines of up to ₦2,000,000 or imprisonment of up to three years, or both, for members, agents or employees of the Authority who obstruct auditors without reasonable cause.

Beyond fines and imprisonment, the Authority has direct regulatory power under Section 49 to sanction erring HMOs, Health Care Providers, Mutual Health Associations, insurance brokers, insurance companies, banks and other operators or accredited persons in line with its operational guidelines. Sanctions can include temporary suspension, revocation of licence or imposition of a fine under Section 5(k).

Employer compliance checklist

If you have five or more staff: register your business with the relevant state health insurance scheme, pick an accredited HMO, deduct employee contributions correctly, remit the combined contribution on time, and keep the paperwork. Non-registration and non-remittance are the two exposures the Act was designed to close.

Where the NHIA Fits Alongside Private HMOs and NAICOM

Two regulators sit close to health cover in Nigeria and are often confused. The National Health Insurance Authority (NHIA) regulates health insurance schemes, accredits Health Maintenance Organisations, Mutual Health Associations, Third-Party Administrators, Health Care Facilities and, under Section 3(r), the insurance companies, brokers and banks that want to participate in health insurance under the Authority. The National Insurance Commission (NAICOM) regulates insurers, brokers and the wider insurance industry under the Insurance Act and, more recently, the Nigerian Insurance Industry Reform Act 2025.

The two mandates overlap where an insurance company sells a health-related product. An NHIA-accredited HMO plan and a NAICOM-regulated health insurance product from a licensed insurer are both legitimate ways to comply with Section 14, provided the underlying scheme has the accreditation the Act requires. For a household choosing a plan, the practical question is not which regulator is in charge but whether the plan is accredited by the NHIA (for HMO cover) or issued by a NAICOM-licensed insurer with the required NHIA participation approval.

Where a plan is private and the reader is not sure whether NHIA-style state cover or a private HMO plan is the better fit for their situation, our comparison of NHIA (formerly NHIS) versus private HMO plans in Nigeria works through cost, coverage, network, waiting periods and the decision by household type; for the pure comparison-criteria angle, our guide on what to look for when comparing health insurance or HMO plans covers the same ground for readers who want to work through it independently.

What This Means for You: Practical Next Steps

The Act has been in force since 19 May 2022. In 2026, compliance is no longer a theoretical question. The practical steps depend on your situation.

1Salary earner at a company with five or more staff

Ask your HR team which HMO holds your current cover, request a copy of the benefit schedule, and confirm your dependants are correctly enrolled. If the plan is thin, top up with a supplementary private plan under Section 14(3). If your employer is not providing any plan, you have grounds to raise the omission in writing; the employer is likely in breach of Section 32.

2Self-employed or in the informal sector

Check whether your state has an active informal-sector programme, look at GIFSHIP if it does not, and compare a private HMO plan alongside as a benchmark. Buy on annual premium plus network plus benefit schedule, not on the sticker price alone.

3Employer with five or more staff

Register the business with the relevant state health insurance scheme, obtain your enrolment reference, choose an NHIA-accredited HMO, deduct and remit contributions in line with the state scheme’s rules, and document everything. The compliance risk sits primarily on the employer under Section 32 and Section 48.

4Supporting a dependant in a vulnerable category

Confirm with the state scheme whether the person qualifies for coverage funded through the Basic Health Care Provision Fund and the Vulnerable Group Fund under Sections 13(7), 25 and 26. If they qualify, no premium is required.

Whichever route applies, the practical starting point for most Nigerians who want to enrol or compare cover is the marketplace. For a step-by-step walkthrough of NHIA enrolment specifically, including the documents you will need, the choice between programmes, and current cost bands, our 2026 NHIA enrolment guide is the natural next read.

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If you are a salary earner or family head trying to work out whether your existing HMO plan is enough, treat this Act as the reason to stress-test what you already have rather than a signal to buy something new. The Act does not require a top-tier plan. It requires a compliant plan. Compare your benefit schedule against three things: whether your usual hospital is in-network, whether maternity or paediatric care you might need in the next 12 months is included and out of any waiting period, and whether the annual limits leave a realistic ceiling for a hospital admission at 2026 Nigerian prices. If any of those three fail, a supplementary private plan under Section 14(3) is often cheaper than switching main provider mid-year. Our ranking of the top 10 health insurance plans in Nigeria in 2026 is a useful shortlist to work from.

If you are a small business owner or SME founder with five or more staff, treat the NHIA Act as a compliance line to cross before it costs you. Registration with your state scheme, an accredited HMO selection, correct payroll deductions and timely remittance are the four operational items that keep your business inside Section 32 and outside Section 48. Group cover is generally cheaper per head than the same benefits bought individually, and it is a tangible benefit for retention. Our guide on comparing health insurance plans for Nigerian businesses covers the group-plan questions in detail.

Frequently Asked Questions

Is health insurance really compulsory in Nigeria now?

Yes. Section 14(1) of the National Health Insurance Authority Act, 2022 states that every person resident in Nigeria is required to obtain health insurance. The obligation applies to Nigerian citizens and legal residents, to salary earners and the self-employed, and to employers with five or more staff.

What is the difference between the NHIS and the NHIA?

The NHIS was the old National Health Insurance Scheme created under Cap. N42, LFN 2004. The NHIA is the new National Health Insurance Authority created by Act No. 17 of 2022. Section 58 of the new Act formally repeals the 2004 Act. The old NHIS as an institution no longer exists; its regulatory role, its formal-sector scheme and its accreditation functions all transferred to the NHIA on 19 May 2022.

Do I need private health insurance if my employer already provides an HMO plan?

Not for compliance with Section 14. An employer-provided HMO plan through an NHIA-accredited HMO satisfies the mandate for the employee. Many Nigerians still buy a supplementary private plan under Section 14(3) to widen the hospital network, remove waiting periods, add dependants, or fill benefit gaps such as maternity or chronic disease cover.

What happens if my employer refuses to enrol staff?

Section 32 requires the employer to register itself and its employees and to remit contributions. Section 48 makes it an offence to fail to pay contributions into the appropriate fund within the specified period, or to deduct an employee’s contribution and withhold it. Employees can raise the omission internally in writing and, where necessary, refer the matter to the relevant state health insurance agency or the NHIA.

Can vulnerable persons enrol without paying?

Yes. Section 13(7) requires state health insurance schemes to provide coverage for vulnerable persons through the Basic Health Care Provision Fund and other sources without charging premiums. Section 25 establishes the Vulnerable Group Fund to subsidise or fund those premiums. Section 59 defines vulnerable persons to include children under five, pregnant women, the aged, the physically and mentally challenged and the indigent.

Are NHIA contributions tax-deductible?

Yes. Section 54 provides that contributions, whether by an employer or an employee under the Act, form part of tax-deductible expenses in the computation of income tax payable by the employer or employee under any other relevant income tax law.

Who regulates HMOs in Nigeria under the new Act?

The NHIA. Section 33 empowers the Authority to accredit Health Maintenance Organisations, Mutual Health Associations and Third-Party Administrators, and Section 3(f) makes accreditation and monitoring an express function of the Authority. Insurance companies that want to participate in health insurance schemes are separately accredited under Section 3(r) but remain regulated as insurers by NAICOM.

Terms and conditions apply. Health-plan benefits, limits, exclusions, waiting periods, provider access and pre-existing-condition rules vary by plan and may change. Please verify all details with the relevant HMO, your employer or the National Health Insurance Authority (NHIA) before enrolling. This article provides general information and is not medical advice.

Insurance, Health Insurance, NHIA & Public Schemes

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Noella Lepdung

Noëlla Lepdung is a writer who makes magic with all sorts of content, helping businesses find their voice and meet their ambitions with cutting-edge but human-first advertising. Her portfolio features brands such as Budweiser, The Coca-Cola Company, Nivea, Leadway Group, Honeywell Foods, Monieworx, Kimberly-Clark, and WAMCO.