Strategic purchasing, purchasing, Health Systems, RESYST, iHEA, Nigeria, health financing

1. Is strategic purchasing a feasible
mechanism in the publicly
funded health system of Nigeria?
Ibe Ogochukwu
Health Policy Research Group, University of Nigeria. Enugu Campus
iHEA, Milan; Tuesday 14 July, 2015
Team members
Enyi Etiaba, Nkoli Ezumah, Obinna Onwujekwe

2. Overview of tax funded health
services
• Health care provision is a concurrent responsibility
of all three-tiers of government in Nigeria
• Tax revenues pooled at the federal level are shared
between the three tiers and each tier of
government has autonomy over allocation and
utilization of their resources
• States also generate taxes through internally
generated revenue and State allocations to health
are used by the State Ministry of Health (MoH) to
purchase health services for their citizens

3. Overview of tax funded health
services
• The District Health System model has been
adopted as the structure for health service
delivery in the state
• Funds are transferred to public facilities mostly in
the form of commodities and global budgets
• Revenues are generated internally (IGR) within
health facilities and a proportion retained at the
facility level for service delivery

4. Key actors in public health
sector

5. Findings: government-purchaser
relationship
• Clear policy and regulatory frameworks exists to
guide the MoH towards a more strategic
purchasing approach (MTSS, SSHDP, annual
budgets and annual operational plans)
• Periodic review of MoH by House of Assembly
(house committee on health) to examine progress
in budget implementation

6. Findings: government-purchaser
relationship
• Clear policy and regulatory frameworks exists to
guide the MoH towards a more strategic
purchasing approach (MTSS, SSHDP, annual
budgets and annual operational plans)
• Periodic review of MoH by House of Assembly
(house committee on health) to examine progress
in budget implementation
• Other mechanisms to ensure efficient fund
utilization include legislative process for resource
re-allocation, proposals to secure release of
budgeted funds

7. Findings: government-purchaser
relationship
• Inefficient bureaucratic processes constrain timely
release of approved funds
• Weak monitoring of budget performance ‘Emphasis
on matching expenditure to budget’
“Well ... there is [government] performance monitoring but that is along
economic planning, budget and all that and strictly not in health services”
(IDI, Government purchaser, 02).
“We do have targets in our mid-term plan but we don’t actually audit the
state Ministry of Health to say how well they are delivering the work. The
commissioner might come out and say he did this or that but nobody
actually goes to crosscheck it” (IDI, government policy maker, 04)

8. Purchaser-provider relationship
• Various tools are employed to enhance efficient
and quality service delivery, for example:
• monitoring of providers by SHB;
• supervision and monitoring by departments and
special programmes in MoH;
• provision of job aides;
• strategic recruitment of human resources;
• improvement of facilities through retained IGR;
• central procurement of drugs

9. Purchaser-provider relationship
• Some of these have provided limited
incentives for efficient service delivery
Human resource challenges (skill & scope)
determines what services are provided
No direct cash remittance for capital costs
from MoH & inability to generate and track
IGR, limit funds available for service delivery

10. Purchaser-citizens relationship
• Formal mechanisms for engaging citizens include
using Facility Health Committees (FHCs) to
understand local health needs, feed back
information on service needs and areas for
service improvements
• Key influences on implementation include:
• Lack of clarity on communication channels
• Poor motivation of FHC due to absence of formal incentives
• Skewed representation of community needs (voice of the
poor not heard)

11. Purchaser-citizens relationship
• Service to citizens based on perceived needs
(top-down), benefit package not regularly
updated to accommodate emerging needs
• Poor community awareness (of rights &
responsibilities) and sense of ownership

12. Policy implications
• To promote and strengthen strategic purchasing
in public health system
• Government needs to go beyond the usual budget
development process to focus on equitable and efficient
use of resources and impact of health services.
• Strong enforcement of procedures and incentives that
encourage provider performance.
• The purchasers need to empower citizens and communities
on their rights and strengthen mutual accountability to
encourage citizen participation.

13. www.wpro.who.int/asia_pacific_observatory
http://resyst.lshtm.ac.uk
@RESYSTresearch
The research is a collaboration between RESYST and the Asia
Pacific Observatory on Health Systems and Policies.
RESYST is funded by UK aid from the UK Department
for International Development (DFID). However, the
views expressed do not necessarily reflect the
Department’s official policies.
More information: http://resyst.lshtm.ac.uk/research-projects/
multi-country-purchasing-study