Expanding the Funding Options for Healthcare

As Nigeria continue to grapple with fixing the healthcare system, low budgetary allocations and limited funding options have impeded efforts to give the sector a lift. Martins Ifijeh writes

When General Ibrahim Babangida overthrew the then military Head of State, Major General Muhammadu Buhari in August 27th, 1985, one of the major reasons cited for the coup was the claim that Buhari’s government was unkind to the health of Nigerians and that only little priority was given to the sector. But in the first year of Babangida’s reign, the health sector was only allocated 2.7 per cent of the total budget, while defense received 7.8 per cent of the budget; an action that suggested Nigerian leaders do not consider the health of the nation as the pivot on which any economy can thrive.

Fast forward to 31 years after, Nigerians are still grappling with low budgetary allocations to the health sector, which has in no small measure reflected on the various health indices of a country that prides itself as the biggest economy in Africa. From maternal health to mortality rate of children under five years, up to mortality rate of men and women in the country, the indices show the country still have huge gaps to fill to be able to meet world standards in healthcare provision.

As part of efforts to close this huge gap hampering the progress of adequate healthcare provision, especially in developing and underdeveloped countries, where diseases outbreaks and its associated effects are a common occurrence, the World Health Organisation (WHO) in its wisdom recommended that countries should allocate at least 13 per cent of their annual budget to the health sector for effective funding of healthcare system. Also, an Abuja Declaration, signed in 2001 by all member countries of the African Union, including Nigeria, recommended that for the continent to be at par with other nations of the world in terms of healthcare provision, 15 per cent of their annual budgeted, at least, be allocated to the health sector.

Even though some countries have started raising their health budgetary allocation towards fully keying into the WHO recommendation of 13 per cent or the Abuja Declaration by the African Union of 15 per cent, Nigeria still lag behind in this regard, which has had direct consequence on the funding capacity of the Health Ministry, thereby making the fight against poor healthcare unrealistic.

Since the beginning of democratic dispensation, the allocation for healthcare in the country has varied between two per cent and six per cent, and in some instances, education and power sector take more budgetary allocations than the health sector, which is arguably the most important sector in a country, as other areas of the economy depends on how healthy the people and the nation are.

With the coming of a new government in power, one would think the priority given to the health sector would finally be restored. However, this year’s allocated amount fell short of what was envisaged, especially in the face of more health challenges affecting the country. From 5.7 per cent allocated to the sector in 2015, the allocation dropped to 4.3 per cent for 2016, which translates into N221.7 billion from the total budget of N6.08 trillion, a figure far below the N1trillion mark that was envisaged by stakeholders in the industry in view of the increased health issues. Experts had also expected that even if the budget would be below the 15 per cent recommended by the AU, it would at least be higher than the previous year, considering the numerous challenges facing the sector.

According to available data, the cost of immunisation alone across the country this year will be $1.4 billion, which when converted using the current dollar rate of $1 to N330, will be about N466 billion; an amount already far above the entire budgetary allocation for the health sector. This is just a small fraction of the several areas needing health interventions in the country.

The WHO believes if all health intervention areas in Nigeria are put into consideration and adequately captured in the budget, it would mean the government will spend a minimum of N6,908 per Nigerian in a year. But, as it is, the country still spends just a little above N1,500 per Nigerian on healthcare, which means about 80 per cent of healthcare services is being funded from out-of-pocket expenses of Nigerians.

This puts Nigeria as one of the nations of the world with the least healthcare spending per head when compared with other countries, especially in Africa. For instance, it has been reported that South Africa spends about seven times more per head on healthcare than Nigeria does, while Angola spends about three times more per head than Nigeria.

According to analysts, the United States healthcare spending per head stands at $7000, which is about N2.3 million and that of Switzerland is $6000, which is about N2 million. This, when compared with Nigeria’s N1,500 per head for a whole year, suggests why the country still grapple with the poor health indices and the abysmally poor mortality rates for Africa’s ‘giant’.

No wonder various statistics show that Nigeria has one of the worst health records in the world. The country’s average mortality rate is put at 52 years, whereas in some less economically strong countries, even in Africa, their mortality rates rank way better than Nigeria’s. For instance, while the number of deaths of infants under one year per 1000 live births in Nigeria is about 72.7, according to a 2015 report from World Fact Book, that of Rwanda is 58 deaths per 1000 children under five. That of Malawi is 42 deaths per 1000. Gabon is 46, Togo is 45, Kenya is 39, while Libya is just 11.

These indices perhaps explain why experts believe the recent allocated amount for the health sector was done in bad faith, hence the need for it to be revisited, while other funding options are looked into, especially with the recent gradual withdrawal of some donor organisations, due to Nigeria’s recent status as the strongest economy in the continent.

Speaking with THISDAY, a former Director, Federal Ministry of Health, who preferred to remain anonymous, said one of the major challenges the ministry had during her time was the poor budgetary allocation to the sector, hence the need for the government to up its game so that needless deaths can be prevented through adequate funding.

She urged President Buhari and the Minister of Health, Professor Isaac Adewole, to review the current percentage allocated to the sector in a bid to raising the figure. “We should raise the figure from last year budget rather than reducing it. If we put the health allocation at eight per cent, or thereabout, it would at least show that we are putting in efforts to addressing the health crisis in the country,” she said.

She also decried a situation in which majority of the amount for health was used for paying health personnel, whereas the public health issues needing tackling were given just a little fraction of the entire amount. “The bulk of the allocation should go to preventive and promotive care,” she added.

She also called for expansion of financial options, as well as strengthening the contribution of private sector in the provision of healthcare in the country. She believed Public Private Partnership was a strategic way of gaining financial options at all operational levels of healthcare.

According to her, when funds are available and used judiciously on healthcare delivery, it would translate into affordable, accessible and effective healthcare delivery.

She said in expanding funding options for the sector, the government should scale up financial schemes that promote universal coverage, as well as scale up support for states to develop state health insurance, to be monitored by the NHIS.

She advised well-meaning Nigerians and organisations to donate towards healthcare.
“With these systems in place, out-of-pocket expenditure will gradually face out, as it would reduce the financial burden of most Nigerians, who are known to live on less than $2 per day.