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30th Jun 2023 | by: admin

Nigeria and the Economics of its Healthcare

Taking Nigerian Health to the next level – a deep dive into the economic underbelly of the Healthcare system
By Femi Olugbile

Recently, a publication titled ‘Nigeria Health Sector Market Study Report’ was launched. The 112-page document was commissioned by the Embassy of Netherlands in Nigeria, in association with PharmAccess Foundation.
The Kingdom of Netherlands has a long history of involvement in the Nigerian Health sector.
Through the Dutch Health Insurance Fund, it was involved in the nation’s first effort at a Community Health Plan, in Kwara State, in partnership with Prof Elebute’s Hygiea, during the governorship tenure of Dr Bukola Saraki. Dutch brands such as Philips are well known as medical equipment manufacturers whose equipment are used in many hospitals in the country.
PharmAccess Nigeria is driving improvements in patient safety and quality of care in several public and private healthcare facilities, as well as seeking to foster increased private sector participation in healthcare.
The document, according to the authors, identifies gap areas, growth areas, and other parts of the health sector where the private sector may usefully, and profitably, participate, in the form of private partnerships (PP), and public private partnerships (PPP).
Health service access and delivery remain in a parlous state for most Nigerians. This is despite marginal improvements in statistics, such as Maternal and Child Mortality. It is also so despite isolated achievements, such as the development of some good hospital brands, many of which possess local or international quality accreditation. A few of such hospitals were featured in a publication by this author titled ’20 Frontline Hospitals in Lagos’.
The commencement of the Bola Tinubu presidency is a good time to look at fundamental issues affecting healthcare in Nigeria and chart a roadmap to a better future. The economics of any health system are of critical importance in its effectiveness and sustainability. Many of the efforts to analyse Nigerian healthcare in the past have been made from the perspective of socialist ideology and criticism, invariably pointing out governmental inadequacies and generating more heat than light. It is, of course, certain, that compliance with the ‘Abuja Declaration of 2001’, which commits governments to spending a minimum of 15% of annual budget on Health, would be useful in deploying better health to the grassroots. On the other hand, without a good understanding of the fundamentals, it could simply translate to more government contracts and white elephant projects. Good Health is built upon good Health Economics, and a synchronisation of the interests and resources of the public and private sectors has the prospect of building a resilient, sustainable partnership for delivery of Universal Health Coverage to the citizens. In such a synergy, even the lowliest citizen would be able to walk into a facility near him and receive good quality healthcare without suffering financial distress.
There is expert agreement that good quality Primary Healthcare is central to any drive to invigorate the nation’s health system.
According to the Nigeria Health Facility Registry, there are 30,345 Primary Healthcare facilities in the country. Of these, the largest number – 1,785 are, predictably, located in Lagos. There are wide disparities in the spread of the facilities. The ideal situation, according to some experts, is that there should be at least one functional Primary Health facility in every Ward of every local government, irrespective of whether the facility is ‘government’, or ‘private’.
There is clustering of facilities in urban areas, leaving many rural areas underserved.
The other worrisome reality, cited by the publication, is that 80% of the primary care facilities are not functional.
In the past few years, there has been talk of building ‘10,000 PHCs’, as a magic number to solve the nation’s grassroots health access problems. It is easy to imagine government officials in the corridors of power salivating at the prospect of imminent award of a deluge of juicy contracts. The stark reality, indirectly raised in the Dutch-PharmAccess document, is that there are up to 24,000 PHCs in various states of disrepair, any number of which could be activated. Because of the clustering in urban areas, there would be some areas that are geographically ‘underserved’. ‘Private’, or ‘Public-Private’ service-provision arrangements, backed up by Health Insurance, could be made to meet the needs of such areas, without much government expenditure on infrastructural or personnel costs.
Health Insurance, the sustainable pathway to Universal Health Coverage in Nigeria, has less than 10% penetration currently. The Tinubu government is targeting a modest target of 40% in the first instance. The PharmAccess document predicts a healthy, and happy, 70% by 2030.
50 million X-rays are done in the country annually. 60% of the X-ray machines are obsolescent.
Medical Tourism cost Nigeria $1.9 billion in 2019, with cancer, kidney problems and cardiology as leading causes.
99% of medical devices are imported, and ability to maintain them is low.
For every $1 of locally manufactured drugs exported from Nigeria, $9 are imported.
As the authors see it, the challenges are also opportunities – for government, and the private sector. The derelict PHCs could be revitalised and standardised. Biomedical and Radio-diagnostic equipment maintenance capabilities could be upscaled. Investment in Health Insurance could be massively increased. More investment in the pharmaceutical industry could scale up local production of drugs and vaccines. Health informatics could be scaled up.
Because of the steep rise in Non-Communicable diseases (NCDs), there is still a need for more ‘Centres of Excellence’. The value proposition lies in a clawing back of some of the billions lost annually to medical tourism, and even the possibility of Nigerian facilities themselves becoming magnets for medical tourism from other countries.
There are nuggets, and much food for thought, in the PharmAccess document. Its moving force, the dynamic Njide Ndili, is to be commended, not for providing answers, but for raising possibilities. Such issues will need to be taken on board by planners in the new government, eager as they are to employ new thinking to make a great leap forward, and deliver, soon, the long-awaited Universal Health Coverage.

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