Costs and resource needs for primary health care in Ethiopia: evidence to inform planning and budgeting for universal health coverage

Abstract

Introduction: The Government of Ethiopia (GoE) has made significant progress in expanding access to primary health care (PHC) over the past 15 years. However, achieving national PHC targets for universal health coverage will require a significant increase in PHC financing. The purpose of this study was to generate cost evidence and provide recommendations to improve PHC efficiency.

Methods: We used the open access Primary Health Care Costing, Analysis, and Planning (PHC-CAP) Tool to estimate actual and normative recurrent PHC costs in nine Ethiopian regions. The findings on actual costs were based on primary data collected in 2018/19 from a sample of 20 health posts, 25 health centers, and eight primary hospitals. Three different extrapolation methods were used to estimate actual costs in the nine sampled regions. Normative costs were calculated based on standard treatment protocols (STPs), the population in need of the PHC services included in the Essential Health Services Package (EHSP) as per the targets outlined in the Health Sector Transformation Plan II (HSTP II), and the associated costs. PHC resource gaps were estimated by comparing actual cost estimates to normative costs.

Results: On average, the total cost of PHC in the sampled facilities was US$ 11,532 (range: US$ 934-40,746) in health posts, US$ 254,340 (range: US$ 68,860-832,647) in health centers, and US$ 634,354 (range: US$ 505,208-970,720) in primary hospitals. The average actual PHC cost per capita in the nine sampled regions was US$ 4.7, US$ 15.0, or US$ 20.2 depending on the estimation method used. When compared to the normative cost of US$ 38.5 per capita, all these estimates of actual PHC expenditures were significantly lower, indicating a shortfall in the funding required to deliver an expanded package of high-quality services to a larger population in line with GoE targets.

Discussion: The study findings underscore the need for increased mobilization of PHC resources and identify opportunities to improve the efficiency of PHC services to meet the GoE's PHC targets. The data from this study can be a critical input for ongoing PHC financing reforms undertaken by the GoE including transitioning woreda-level planning from input-based to program-based budgeting, revising community-based health insurance (CBHI) packages, reviewing exempted services, and implementing strategic purchasing approaches such as capitation and performance-based financing.

Keywords: Ethiopia; actual cost; essential health services package; normative cost; primary health care; universal health coverage.

Figure 1

Distribution of services in sampled facilities, 2018/19. Percent distribution of annual mean number of services in sampled facilities. OPD, Outpatient department; MCH, Maternal and child health; DEL, Delivery; and IPD/OR, Inpatient department and operating room. DEL <1% in health posts, HIV/AIDS <1% in health posts, no IPD/OR in health posts, and IPD/OR < 1% in health centers.

Figure 2

Distribution of costs in sampled facilities, 2018/19. Percent distribution of annual mean costs in sampled facilities. Clinical labor, includes labor expended on clinical services by doctor, nurse, midwife, other health worker, social worker, technician. Indirect costs, includes costs of labor expended on administrative tasks, as well as utilities and other recurrent costs. Indirect costs for health posts included in health centers to which they are attached.

Figure 3

Sources of financing in sampled facilities, 2018/19. Percent distribution of financing sources in sampled facilities for total costs and drug and medical supply costs. Funding sources include government funds (Treasury), facility revenue obtained through user fees and community-based health insurance (CBHI) facility payments (Internal revenue), and resources provided by development partners (Donors).