Background

Nigeria has some of the highest rates of maternal, infant, and child mortality in the world. 20 The primary care system suffers from low utilization, inefficiency, and insufficient quality of care, contributing to poor health outcomes. 

Getting adequate funds to front-line providers is an underlying contributor to these challenges. For example, a 2018 public expenditure review found that Ekiti State’s total primary care budget was $8.68 per capita, with $4.67 per capita actually disbursed. In Niger State, of the $6.47 per capita primary care budget, only $4.16 per capita was disbursed.  Only 66% and 72% of personnel budgets were executed in Ekiti and in Niger states respectively. When personnel costs are excluded from the primary care budget, the review found that an estimated $0.07 per capita in Ekiti and $0.04 per capita in Niger reached primary care facilities. Low levels of budget execution and a retention of those resources at each level of government are common reasons why facilities do not receive budgeted funds. This drives facilities towards depending on user fee revenue to cover their expenses, exacerbating access challenges for patients who cannot pay. 21

Getting funds to frontline providers

In 2011, the Nigeria State Health Investment Project (NSHIP) – a partnership between the Government of Nigeria and the World Bank – began testing new ways to get funds to front-line providers to improve primary care performance. NSHIP changed how primary care funds were allocated, delivered, managed, and reported on in participating public facilities. Prior to NSHIP, facilities received inputs in-kind with few or no additional operating funds. They did not have the ability to manage facility budgets or make decisions about procuring additional inputs. Under NSHIP, facilities began receiving quarterly grant transfers for operational costs, disbursed directly to facility bank accounts that could be accessed by the facility manager. Some facilities received funds as a block grant. To test the effect of performance-based payments, some facilities also received additional performance grants tied to the quality and quantity of services provided. 22

Providers now had more autonomy to allocate and spend funds on allowable costs within the facility, such as maintenance, procuring additional medicines and supplies, and hiring contract staff. Facility managers had to develop business plans to guide this spending and were required to report on how they utilized the funds. The performance-based financing (PBF) facilities could use up to 50% of their quarterly payment for staff performance bonuses. 22

Facility development committees at the community level, along with state primary health care development agencies, worked to ensure that funds were spent appropriately and reflected the needs of patients. While financial management and record keeping were a challenge in primary care facilities and few facilities had dedicated financial officers that were trained in record keeping, nonetheless a financial review found that funds were generally utilized for approved operational expenses. 23

Outcomes

The NSHIP program had a measurable impact on primary health care in participating facilities, including improvements in quality (availability of drugs and supplies, waste management, and hand washing), and coverage (curative care for children under 5, antenatal care utilization, and modern contraceptive prevalence). Improvements were also seen in facility infrastructure. Finally, the timeliness’s of NSHIP payments was correlated with increases in the quantities of services provided. 23 An evaluation of the program concluded “providing operating budgets to health facilities, allowing them to spend the funds on their perceived priorities, systematic supervision using a QSC [quality score card] and strengthened management and governance at LGA [local government], state and federal levels were the main reasons for the success of NSHIP”. 23  Interestingly, the PBF facilities achieved similar results, suggesting that providing additional, performance-based bonuses to providers was not the main driver of observed improvements. 

Initially operating in Ondo, Adamawa, and Nasarawa States in 2014, NSHIP has since expanded to an additional six states in Northern Nigeria. Many of NSHIP’s approaches have now been institutionalized in Nigeria’s Basic Health Care Provision Fund, a nationwide initiative funded from 1% of Nigeria’s consolidated federal revenue.