Strengthening BHCPF through Public Private Partnerships


The launch of the Basic Healthcare Provision Fund by President Muhammadu Buhari last Tuesday has again provided an opportunity for the Nigeria private health sector to improve access to quality and affordable health services to poor and vulnerable Nigerians towards attaining Universal Health Coverage. Olumide Okunola of the World Bank/IFC and Clare Omatseye, President Healthcare Federation of Nigeria write




The low levels of human capital in Nigeria has recently received the attention of the National Economic Council (NEC) – the council convened for a special session last month to consider how to immediately address such challenges. The special NEC chaired by Nigeria’s Vice President Prof Yemi Osibanjo was attended by almost all state governors and the meeting acknowledged the consequences of poor human capital formation on the nation’s economic growth. The very poor human capital outcomes in the country is a reflection of chronic underinvestment in health and education by successive governments in Nigeria.

It must be noted that a period of strong economic growth driven mostly by rising oil prices did not lead to improved health outcomes in the country however rapid improvements in health will be a critical contributory factor for economic growth. Low revenue collections, competing demands for revenues, and relatively low spending priority contribute to this insufficient spending on health. The consequent low public spending on health has created a gap between the actual spending and the required amount with its most obvious adverse impact being the lack of a preventative health infrastructure. Simply put low levels of public spending have resulted in the low health status of Nigerians. For emphasis Nigeria is one of the countries with the lowest level of public spending on health in the world. This situation is further worsened as the little amount of money spent is directed towards mostly curative and tertiary health care services as opposed to more essential preventive, primary, and secondary care where the poor and vulnerable will mostly be the beneficiaries. As can be expected it is the poor that loses out from this skewed manner of spending as result of foregone care in the face of lack of financial protection.

The provision of health care in Nigeria is predominantly the responsibility of state and local governments. However, the ability of these governments to spend on healthcare is particularly constrained by a number of factors notably low revenue base and in several instances low availability of critical Human Resources for Health. Thus, as bodies like the National Economic Council begin to ponder on reforms necessary to reinvigorate the health sector, we articulate the following three – Nigeria will need to address the issue of increasing budgetary allocations to health care backed by cash warrants; a renewed focus on preventative care whilst ensuring greater access to health care for the poor; and significantly improving the productivity of public spending.

However, the implementation of these reforms will be meaningless in the lack of a deliberate attempt aimed at harnessing the enormous potential available in the Nigeria private health sector. This is why we argue that for Nigeria’s Universal Health Coverage (UHC) aspirations to stay on course, the private health sector necessarily has to be part of the solution to what can be described as a “wicked problem”.

For us, the private health sector in Nigeria refers to the totality of all non-state-owned institutions and individuals providing healthcare. In fact, in Nigeria, they constitute the membership of the Healthcare Federation of Nigeria where they serve as a single voice to engage with the government at all levels on how the potential in the private health sector can best be leveraged to expand service coverage and provision.

The dominance of private provision of health services is evident in three distinct ways. Firstly, in the high out of pocket payments for health services and the low ratio of public expenditures to GDP; Secondly, in several parts of the country the private sector delivers most of the care sometimes accounting for about 65 per cent of all services delivered at all levels and incomes and lastly in the highly deteriorated public health sector where user fees and charges create an additional barrier to care.

We do recognize that the quality of care delivered in some of these private facilities leaves much to be desired to the extent that some will argue that the private sector seems to provide both the best and worst quality in healthcare with clear cut equity implications. Some of the best care in the best facilities with the most well-trained staff in Nigeria are privately provided. Though the vast majority of private-sector care is found at the other end of the spectrum and this is where you have the community health workers, Proprietary Patent Medicine Vendors, and unrecognized providers.

For a country like Nigeria, the potential of the private health sector to support Nigeria in achieving health outcomes necessary for human capital formation and economic growth is enormous. In harnessing the private sector into delivery and expansion of service coverage the strategy to engage the private sector must be inclusive, deliberate, and innovative. Translating the transformational concept of UHC Nigeria with the required attention in the face of aforementioned human capital challenges requires sourcing quality and affordable care from where ever that care exists be it in the public or private sectors!

The additional financial commitment to the health sector though the BHCPF provides a unique opportunity to significantly expand service coverage to millions of Nigerians whose lot worsens whenever they seek healthcare. In particular, the availability of additional resources through the BHCPF allows private health providers to be folded into plans to significantly scale up service delivery points in all nooks and crannies of the country. We note that the financing received from the BHCPF allows clients to receive care free of all charges from accredited providers be it public or private. Where such financial constraints are removed through the availability of financing as in BHCPF then Nigeria needs to ensure the following to reach scale quickly – we propose some necessary actions to enable this.

Public Private Dialogue

The creation of a level playing field for public and private health sectors needs to be facilitated through the creation of a platform for sustained dialogue. The ensuing process enables the federal and state governments and private sector actors (not-for-profit and for-profit) to exchange views and share their perspectives on health sector issues of common concern and interest.

In this regard, the Healthcare Federation of Nigeria has led the way in championing several policy reforms leading to a more efficient and effective way to design reform proposals that get successfully processed, accepted and implemented. We cite the recently approved National Health PPPs policy, Nigerian Healthcare Incentives policy amongst others as successful outcomes from this process in Nigeria.


Innovative Public Private Partnerships for primary healthcare

A recent survey showed that lack of infrastructure in terms of buildings and facilities does not seem to be a problem in Nigeria as 67 percent of the population live within 30 minutes’ walk of a health facility and better still 85 percent live within one hours walk. This compares favorably to neighboring countries, yet those other countries have better health outcomes. Public primary healthcare facilities see on the average a total of three to six patients per day. There are several constraints to such an abysmally low level of productivity including failure to allocate staff resources between facilities on the basis of their productivity or need; the allocation of a major portion of total spending to staff costs leaving facilities with a shortage of operational expenses; and lack of motivation among health workers and government officials and little consideration for results. There is an urgent need to shift the focus to results-oriented service delivery, geared towards enhancing both quantity and quality of services.

Lagos Model on Public Private Partnership

We urge state governments to learn from the lessons of the Lagos State government who have outsourced dysfunctional, dilapidated public primary health centers to private operators. Working in partnership with the state government in conjunction with the Healthcare Federation of Nigeria, Pharmaccess and the IFC partnered with the private sector to improve the readiness of the public PHCs to deliver services. Under such innovative partnerships the private operator takes over the facilities and is reimbursed through the state insurance scheme the BHCPF provides state governments the opportunity to replicate this kind of innovative PPPs.

Strategic purchasing

Additional financial resources provided through the BHCPF are a necessary but not sufficient condition for the Nigerian health sector to make a turn for the better. Nigeria cannot spend its way to improved health outcomes. A “business as usual” spending pattern will result in the maintenance of the status quo. The BHCPF through the National Health Insurance Scheme (NHIS) gateway allows private providers to deliver services. The leverage embedded in the reimbursements allows for improvements in the quality of spending as providers will need to be accredited in addition a focus on a defined benefit package means paying providers for what they have actually delivered. Thus,rather than pay providers regardless of performance they will be paid based on the quantity and quality of care delivered – this will put paid to the endless strikes as reimbursement is tied to actual performance and more importantly it will give beneficiaries a choice allowing them to choose between the public and private facilities as money follows the patient.

In closing we reiterate the well-known fact that the private sector plays a dominant role in health delivery in Nigeria more so for the poor and vulnerable and the launch of the BHCPF provides a unique opportunity for the private sector to deliver care for these populations as it covers their cost when they access services. A strong private health sector allows Nigeria to move faster towards its UHC goals it can create jobs and also further public healthcare goals at the same time. We have outlined some simple actions that the Federal and state governments in Nigeria can take using the unique opportunity provided by the BHCPF. Doing so puts the attainment of Universal Health Coverage at a tantalizing touching distance.

…Olumide Okunola is a Senior Health Specialist at the International Finance Corporation of the World Bank Group.

…Clare Omatseye is President of the Healthcare Federation of Nigeria and Vice President of the West African Healthcare Federation