Can Strategic Health Purchasing Reduce Inefficiency and Corruption in the Health Sector? The Case of Nigeria

Abstract

ABSTRACT Despite limited government budgets for health in many sub-Saharan African countries, some countries have improved health outcomes at low cost by being strategic in allocating and spending available resources. Strategic health purchasing is receiving increasing attention as a way to improve health system performance within financial constraints. Health purchasing, one of the health financing functions of health systems, is the transfer of pooled funds to health providers to deliver covered services. Strategic health purchasing uses evidence and information about population health needs and health provider performance to make decisions about which health services should have priority for public funding, which providers will provide these services, and how and how much providers will be paid to deliver those services. Strategic purchasing has enabled some countries to make progress on health sector goals while improving efficiency, equity, transparency, and accountability. However, when countries have high levels of corruption and low levels of accountability, as in Nigeria, strategic purchasing may be less effective and more money for health may not yield the expected public health benefits. This commentary uses the Strategic Health Purchasing Progress Tracking Framework developed by the Strategic Purchasing Africa Resource Center (SPARC) and its technical partners to examine health purchasing functions in Nigeria’s main health financing schemes, how corruption affects the effectiveness of health purchasing in Nigeria, and opportunities to use strategic purchasing as a tool to address corruption in health financing by improving the transparency and accountability of health resource allocation and use.