The 3ws—an Overview of the Most Common Regulatory Breaches in Nigeria's Mixed Health System

Updated on June 5, 2020
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Ejeagba is writer who is passionate about strengthening health systems for the communities that depend on them.

What Is a Mixed Health System?

Nigeria operates a Mixed Health System
Nigeria operates a Mixed Health System | Source

A Mixed Health System is a health system in which out-of-pocket payments and market provision of services predominate as a means of financing and providing services in an environment where publicly-financed government health delivery coexists with privately-financed market delivery.

— Nishtar S.

Drivers of Poor Performance in Mixed Health Systems

According to a written article published in the bulletin of the World Health Organization (WHO); the poor performance observed within mixed health systems has largely been hypothesized to be as a result of the interplay of three major factors, namely: insufficient state funding for health, lack of transparency in government, and the presence of a regulatory environment that enables the private sector to deliver social services without an appropriate regulatory framework.1

Insufficient state funding for health.

Following the 2001 Abuja Declaration, African Union states were urged to allocate at least 15% of their national budgets to the health sector. However, since that declaration, Nigeria has not achieved the pledged funding benchmark. Presently, Nigeria’s Current Health Expenditure is only 3.7% of its Gross Domestic Product (GDP).2 Healthcare in Nigeria is financed principally from three sources: the Government, Donor Funds, and from Out-of-Pocket (OOP) expenditure. Of these, OOP expenditures remains the largest source of funding for health services at 72.2% of Current Health Expenditure. According to the National Health Accounts (NHA) from 2005 to 2010, Out-of-Pocket expenditures provided an average of 63.8% of funding for health care in Nigeria. Due to the fact that the burden of OOP expenditures is high across the country, many households are becoming poor due to healthcare payments. In 2017, Nigeria's Public expenditure on health from domestic sources as a share of total public expenditure was only 4.6%.2 However, it is not in all instances that actual expenditures on health tally with approved budget allocations because the budgets are at times cut or not passed on time.

Nigeria’s Current Health Expenditure is only 3.7% of its Gross Domestic Product (GDP).
Nigeria’s Current Health Expenditure is only 3.7% of its Gross Domestic Product (GDP). | Source
Out-of-Pocket expenditures remains the largest source of funding for health services at 72.2% of Current Health Expenditure
Out-of-Pocket expenditures remains the largest source of funding for health services at 72.2% of Current Health Expenditure | Source
In 2017, Nigeria's Public expenditure on health from domestic sources as a share of total public expenditure was only 4.6%
In 2017, Nigeria's Public expenditure on health from domestic sources as a share of total public expenditure was only 4.6% | Source

Presently, Nigeria’s Current Health Expenditure is only 3.7% of its Gross Domestic Product (GDP). Healthcare in Nigeria is financed principally from three sources: the Government, Donor Funds, and from Out-of-Pocket (OOP) expenditure. Of these, Out-of-Pocket expenditures remains the largest source of funding for health services at 72.2% of Current Health Expenditure. In 2017, Nigeria's Public expenditure on health from domestic sources as a share of total public expenditure was only 4.6%.

Lack of transparency in governance.

On the issue of transparency, Nigeria's performance is still very poor. According to Transparency International and International Budget Partnership, in 2019, Nigeria scored 26 and 21 out of 100 on the Corruption Perception Index (CPI) and Open Budget Index (OBI) respectively.

Not Transparent Enough
Not Transparent Enough | Source

“Weaknesses in governance and transparency can further compromise scarce resources in the health sector by allowing collusion in procurement and theft from the supply chain”.

-Nishtar S.

A regulatory environment that enables the private sector to deliver social services without an appropriate regulatory framework.

Prior to the formulation of Nigeria’s National Policy on Public Private Partnerships (PPP) for Health, the regulatory mechanisms for health service delivery was largely ineffective as the provision of services in the health sector frequently fell below acceptable standards.3 Now that Nigeria has a regulatory framework in place through its Policy on Public Private Partnership, the issue at hand is the poor enforcement of regulations. WHO estimates that globally, 20–40% of all health spending is wasted through inefficiency because of legal and regulatory frameworks that are inadequately reinforced.4

Source

Prior to the formulation of Nigeria’s National Policy on Public Private Partnerships (PPP) for Health, the regulatory mechanisms for health service delivery was largely ineffective as the provision of services in the health sector frequently fell below acceptable standards.

Who's Responsible for Regulation in Nigeria's Health Sector?

Source

Though the regulation of the public health sector is the prime responsibility of the government and regulatory bodies; when it comes to regulation, there’s no “one size fits all” approach for the public and private health sectors.To begin with, Nigeria’s Mixed Health System has a wide range of actors in the public and private health sectors. The National Policy on PPP for Health clearly specifies the roles and responsibilities of the broad categories of actors in the health sector –Government (inclusive of all three tiers) and its agencies, the for-profit and non-profit private actors and consumers.Yet, when it comes to the specifics of regulating drugs, biologicals and medical devices; the regulatory authorities with jurisdiction over them are:5

  1. The National Agency for Food and Drug Administration and Control (NAFDAC)
  2. The National Drug Law Enforcement Agency (NDLEA)
  3. The Federal Ministry of Health (FMOH)

However, within the jurisdiction of states and the standards and minimal levels of quality and safety set by the federal government, it is the responsibility of the State Ministry of Health (SMOH) and Professional Councils/Associations to regulate the activities of private actors (for and non-profits) and health professionals respectively.

Within the jurisdiction of states and the standards and minimal levels of quality and safety set by the federal government, it is the responsibility of the State Ministry of Health (SMOH) and Professional Councils/Associations to regulate the activities of private actors (for and non-profits) and health professionals respectively.

The 3Ws -Work, Workers and Worth

3Ws -Work, Workers, Worth.The formulation of regulatory policies in Nigeria's health sector is often more intense and multiplex owing to special interests and the broad range of actors offering services across the public and private health sectors.
3Ws -Work, Workers, Worth.The formulation of regulatory policies in Nigeria's health sector is often more intense and multiplex owing to special interests and the broad range of actors offering services across the public and private health sectors. | Source

1. Work (Quality of Healthcare Services)

For decades, the public sector has been the main provider of public health services in Nigeria. However the trend is changing, as the private sector is fast emerging as a key player in the provision and financing of healthcare services in Nigeria. Unlike the public health sector where healthcare services are delivered by non-profit public healthcare providers in publicly owned facilities; services in the private health sector are provided by private practitioners, either for or non-profit in privately owned facilities. So when regulations are not implemented and enforced effectively, we can expect poor quality health services and a variety of self-serving and profit-making activities to thrive especially within the private health sector.

Though there is a standardized regulatory framework covering both the public and private health sectors to create and sustain the quality of healthcare provision in Nigeria; these regulations are often not fully enforced leading to absent or sub-standard healthcare services and excessive profiteering. Examples include: use of out-dated equipment to diagnose medical conditions, vested financial interests in services that clients are referred to, running multiple investigative and therapeutic procedures for clients that add no value to the diagnosis or treatment of the disease at hand, and the utilization of non-licensed health delivery facilities.

Though there is a standardized regulatory framework covering both the public and private health sectors to create and sustain the quality of healthcare provision in Nigeria; these regulations are often not fully enforced leading to absent or sub-standard healthcare services and excessive profiteering.

2. Workers (Engagement of Human Resource for Health)

The public and private health sectors offer opportunity for growth, but unlike the private health sector where profit making, growth and competition are the main driving force; the public sector is mostly driven by the desire for accountability, cost reduction and efficiency especially when there are functional regulatory frameworks in place. Despite Nigeria's significant progress in achieving the Global Strategy for Human Resources for Health (HRH); significant gaps in HRH still exist in private and primary level health facilities.

Due to the fact that private health facilities are mostly poorly regulated by SMOHs; under or non-qualified health personnel are often employed in these facilities to cut costs. In Primary Healthcare Centers (PHCs) external influences (some of which are nepotistic) are often responsible for the transfer-out and redistribution of healthcare workers from PHCs in hard to reach areas resulting in scarcity of skilled health workers in those areas; further aggravating the underlying disparity in the distribution of health professionals in urban and rural areas.

Despite Nigeria's significant progress in achieving the Global Strategy for Human Resources for Health (HRH); significant gaps in HRH still exist in private and primary level health facilities.

3. Worth (Price and Value of Healthcare)

Though both sectors are generally open to technological advancements; a lot of the technology that tends to be used in the public health sector is either outdated or years behind the standards that are being employed in the private health sector because of poor funding in the public health sector. Examples include our huge reliance on paper for data records especially in primary and secondary health facilities, the lack of functioning internet services across health facilities; and the presence of obsolete equipment in healthcare facilities and wards. Nigeria's frequent power outages is also responsible for the poor technological advancements observed in the public health sector as its effect is mainly two-fold. First, it drives the cost of healthcare up. The use of power plants to generate electricity across health facilities in the country is not uncommon; this practice is not only unsustainable but is also highly inefficient. Second, it diminishes the nation's ability to fully utilize modernized health equipment in the public sector and especially in rural areas that are very hard to reach.

Furthermore, because there are no fixed mechanism in place for the pricing and reimbursements of drugs, biologicals and medical devices in Nigeria, a wide variation in the cost of goods and services exists within and across state boarders. Variations in cost are more pronounced in the private health sector and includes a wide range of revenue generating private facilities such as clinics, laboratories and diagnostic centers; many of of which are largely unregulated, and sometimes owned by employees of federal, state or local health institutions. As a result, many Nigerians are continually being exploited. Given the huge amount of healthcare financing that comes from out -of-pocket payments despite Nigeria’s National Health Insurance Scheme (NHIS), and the high proportion of for-profit providers which constitute the majority of private sector health facilities in Nigeria (FOS 91); the need to set in place a price regulatory mechanism cannot be overemphasized.

Because there are no fixed mechanism in place for the pricing and reimbursements of drugs, biologicals and medical devices in Nigeria, a wide variation in the cost of goods and services exists within and across state boarders.

Going Forward...

It is important to note that when formulating regulatory policies, the overall goal should not just be to address aspects of healthcare provision but to reform the entire healthcare system. Government and regulatory bodies must be able to strike the balance between the formulation of policies which are intended to increase the coverage and delivery of health services; and enforcing regulatory controls that limit the spread of harmful medical practices which impair the quality of care. While the traditional focus of regulation in the public health sector should be standard setting; for example ensuring minimal levels of quality and safety, and regulatory frameworks for operation of services; in the private health sector, it is imperative that policies not only ensure basic services are available and equitably distributed, but that established mechanisms of financial risk protection for the poor and vulnerable are available. Furthermore, as the interaction with the private sector expands towards working to increase coverage, additional forms of engagement are also needed in decision making on health policy objectives and strategic plans aimed at strengthening the quality of healthcare services.

Government and regulatory bodies must be able to strike the balance between the formulation of policies which are intended to increase the coverage and delivery of health services; and enforcing regulatory controls that limit the spread of harmful medical practices which impair the quality of care.

Sources

  1. Sania Nishtar. The mixed health systems syndrome. Bulletin of the World Health Organization. 2010;88:74-75. doi: 10.2471/BLT.09.067868
  2. The World Bank Open Data.
  3. National Policy on Public Private Partnership for Health in Nigeria, 2005
  4. The World Health Report. Financing for Better Coverage. Chapter 4.
  5. Pharma Boardroom. Regulatory, Pricing and Reimbursement Overview: Nigeria.
  6. Patterns of Global Health Expenditures: Results for 191 Countries. WHO 2002
  7. Federal Republic of Nigeria. Draft National Policy on Incentivizing Healthcare Investments.
  8. Ibukun O, Adenike O, Nosa O. Private Healthcare in Nigeria. Walking the tightrope. Health Policy and Planning; 14(2): 174-181.
  9. National Health Account. 2010
  10. International Budget Partnership. Open Budget Survey.
  11. Trading Economics. Nigeria Corruption Index.
  12. Federal Office of Statistics (FOS) 1991. Health Manpower and Facilities Survey Lagos.
  13. The North South Institute. How to Engage the Private Sector for Development.

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