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Fixing the Nigeria’s healthcare challenges will require more public spending

According to a study conducted by the IFC with assistance from McKinsey & Company in 2009, only a few countries in Sub-Saharan Africa are able to expend the WHO-determined average of US$35-US$50 (N5,250 - N7,500) per year per person on healthcare despite the surge in foreign assistance from several multilateral agencies and donors during that decade. The study estimated that over the next decade (2010 - 2020), US$25 billion – US$30 billion (N3.7 trillion - N4.5 trillion) in new investment will be needed in healthcare assets, including hospitals, clinics, and distribution warehouses, to meet the growing healthcare demands of Sub-Saharan Africa. The World Health Organisation (WHO) estimates that about 50% of Sub-Saharan Africa’s total health expenditure is financed by out-of-pocket payments from its largely poor people. It is therefore understandable that Sub-Saharan Africa with about 11% of the world’s population accounts for about 24% of the global disease burden in human and financial costs despite commanding less than 1% of global health expenditure. Globally, almost 50% of the deaths of children under five take place in Africa. In Nigeria, the Ministry of Finance reported that the resources available for delivering the essential health care package are about N3,848.00 (US$25.65) per capita. Low public spending on healthcare provides a huge opportunity to leverage the private sector in ways that will improve access and increase financing and the quality of healthcare goods and services throughout Africa.

The Nigerian healthcare sector shares the same attributes with its African peers

Infrastructure decay, brain drain, incessant workers’ strikes and low investments in the sector characterise healthcare services in Nigeria. Collectively, all tiers of the healthcare system have suffered. In 2011, national spending on teaching hospitals and federal medical centres is estimated at N204 billion; approximately 79% of the government’s health expenditure. However, only N20.25 billion (10% of total hospital expense) is allotted to capital expenditure in spite of insufficient medical equipment.

The structure of Nigeria’s public healthcare system is multi-layered

Public health care delivery system in Nigeria consists of a network of primary, secondary, and tertiary facilities. In 2005, the Federal Ministry of Health estimated a total of 23,640 health facilities in Nigeria of which 85.5% are primary, 14% secondary and 0.2% tertiary health care facilities. 38% of these facilities are owned by the private sector. This has not changed significantly since then. Primary care was largely provided through health clinics and dispensaries spread throughout the country. Secondary care is provided through general hospitals and maternity centres while tertiary care is handled through the university teaching hospitals.

Inadequate infrastructure and poor staff morale lead to poor service delivery in public hospitals

The target areas for mass procurement of medical equipment are the teaching hospitals. The absence of proper facilities and inadequate remuneration of public sector healthcare workers have resulted in the coexistence of privately-owned hospitals which cater to those who can afford them side by side with the public healthcare centres. In public funded hospitals, physical facilities are often decaying, and equipment is either obsolete or non-operational as a result of power challenges. The irony however, is that the few highly skilled medical professionals are often found in public employment but are almost always providing consultancy services in privately funded firms or in their own personal clinics.

Nigerian Health indicators are very poor

According to the Federal Ministry of Health, the health indicators for Nigeria are among the worst in the world. Nigeria shoulders 10% of the global disease burden and is making slow progress towards achieving the 2015 targets for the MDGs on healthcare. The health indicators in Nigeria have largely remained below country targets and internationally-set benchmarks due to weaknesses inherent in the system. Hence the government is convinced that a purposeful reform of the National healthcare delivery system is necessary. The government, thus, initiated a process that led to the development of the National Strategic Health Development Plan 2010-2015 (NSHDP) which was developed in a highly participatory manner in 2010.

 …But the National Strategic Health Development Plan (NSHDP) 2010-2015 has not taken off yet

The NSHDP 2010-2015, developed to strengthen the national health system and to vastly improve the health status of Nigerians, estimates that a total amount of N3.99 trillion (US$26.6 billion) would be required to reposition the Nigerian Health system over the 6 year period. Funding sources are limited largely to government spending at all levels, development partners via Official Development Assistance (ODA) and Non-Governmental Organisations (NGOs) and Philanthropists. 

Over the 6 year implementation period of the NSHDP, the estimated annual spending requirement is N666.16 billion. Unfortunately, in the first year of implementation in 2011, the total health sector budget is only N257.87 billion. This represents 5.75% of the total budget and less than half of the required annual spending. In addition, the National Health Bill upon which the spending is based is yet to become law. The rising competition for government resources continues to make it difficult for any sector to get the kind of guaranteed allocation that is proposed in the bill as well as potential increase in government expenditure to the sector in the future. The plan was delivered in August 2010 which was already eight months into its first implementation year. Therefore the plan already had a bad start and is unlikely to deliver results as intended.