53914 Public Health in Chad: Connecting Spending and Results A public expenditure tracking study shows that when public funds reach health centers, they make a positive difference in people's access to health care A n expenditure tracking study carried out in Leakage increases the price health centers Chad in 2004 finds that the majority of non- charge patients for drugs wage funds from the central budget never Health centers that do not receive public support tend reach local health clinics. The cost of capture and leak- to charge significantly higher mark-ups on medications age falls heaviest on the poor, who may not be able to than centers that receive public resources. The higher get treatment or pay for the higher price mark-ups on prices for medication sold to patients by health centers drugs in the health centers that do not receive public constitute a major barrier to treatment. Out-of-pocket resources. The evidence from a second survey suggests spending for drugs can often exceed 70­80 percent of that income inequalities also translate into health ser- the cost of a visit. vice inequalities, which further reduces access to basic health services by the poor.1 The number of patients treated could have Chad is one of the poorest countries in Sub-Saharan doubled without leakage Africa, ranking 100th out of 103 countries on the Hu- The negative relationship between spending and health man Poverty Index. Its health indicators are among output at the regional level is reversed if public funds the worst--average life expectancy at birth is 43 years. reach the clinics. The figure on the left shows a para- Despite an increase of 24 percent in the government doxically negative association between public resources budget for health in 2003 and significant increases in health and performance while the figure on the right in resources allocated to health in the past decade, shows this result does not hold once leakage is taken into the incidence of malaria, diarrhea, respiratory infec- account. When expenditures actually reach health cen- tions, parasites, meningitis, and cholera remains high ters they have a positive and significant impact on the and social indicators remain stagnant. Where is this number of patients treated. money going? Leakage is crippling the public health delivery system Public expenditure and health system performance: Budgeted The study showed that health centers, which are the resources, and resources received, at the regional level frontline providers and the entry point for much of the Number of patients per Number of patients per population, receive less than 1 percent of the Ministry 1,000 inhabitants 1,000 inhabitants of Health's non-wage recurrent expenditures set aside Mayo-Kebbi Mayo-Kebbi 500 500 for their use. These figures were obtained by combin- Moyen Chari Moyen Chari Logone Occidental Logone Occidental ing a bottom-up analysis of data gathered from 281 pri- mary health centers and 20 hospitals and a top-down 400 400 analysis of the share of public expenditures making its Logone Oriental Logone Oriental way through the four levels of the health system (the Kanem BET Kanem BET central ministry which formulates national health pol- 300 Guera 300 Guera Tandjile Biltine Tandjile Biltine icy, regional health delegations responsible for coordi- Salamat Salamat Chari-Baguirmi Chari-Baguirmi nating and implementing the strategy at the regional Ouaddai Ouaddai Batha Batha level, sanitary districts headed by a chief doctor with 200 Lac 200 Lac at least one hospital, and a network of health centers).2 500 1,000 1,500 2,000 100 200 300 400 500 600 The study showed a direct relationship between leakage Budgeted resources per capita (CFA francs) Resources received per capita (CFA francs) and an increase in out-of-pocket expenses by users. Source: Gauthier and Wane (2008). Note: Budgeted vs. received public expenditure and total health output at the regional level, measured as number of patients per 1,000 inhabitants. August 2008 econ.worldbank.org/research Income inequalities also translate into health keeping on resources received by health centers from service inequalities higher administrative levels and how the money is Poor people care about the quality of the treatment spent would contribute to transparency and account- and care they receive from health facilities. One piece ability by public officials. Providing the public with ac- of evidence for this is that people bypass the nearest cess to information on transfers can also be useful in health center in favor of one that is farther away if it is efforts to reduce capture and leakage of public funds deemed better. Additional data collected from 1,200 for health as well as other social sectors, as it did in health care employees and 1,801 patients looked at a Uganda, where a public information campaign reduced patient's knowledge of existing alternative providers the capture of school grants from 80 percent in 1995 to in their neighborhood and where they seek medical less than 20 percent in 2001.4 care.3 Evidence shows, however, that affordability trumps Waly Wane, Economist quality for poor people. Richer people bypass nearer wwane@worldbank.org low-quality public providers to visit private providers whereas poorer individuals bypass nearer private pro- Notes viders they cannot afford to seek care in a lower quality 1 The survey, designed and organized by the author, ex- amined various levels of the health sector, collecting the public health center. most complete information possible on resource use, de- Bypassing behavior is primarily an urban phenom- livery processes, health outputs, and pricing behavior. enon. More than 60 percent of patients in the capital 2 Bernard Gauthier and Waly Wane. Forthcoming. "Leak- city have bypassed at least one health facility versus 28 age of Public Resources in the Health Sector: An Empiri- percent of patients in rural areas. cal Investigation of Chad." Journal of African Economies. This bypassing behavior reflects the larger num- (Based on World Bank Policy Research Working Paper ber of service providers available in urban areas and 4351, September 2007). suggests a mismatch in the allocation of public health 3 Bernard Gauthier and Waly Wane. 2008. "Bypassing resources between urban and rural areas. Rural facili- Health Providers: The Quest for Better Price and Qual- ties are often overcrowded despite their low quality, ity of Health Care in Chad." World Bank Policy Research while urban public facilities, generally bypassed by the Working Paper 4462, January. wealthy in favor of private and faith-based providers, 4 Ritva S. Reinikka and Jakob Svensson. 2004. "The Power attract few clients. Ultimately, careful monitoring of of Information: Evidence from A Newspaper Campaign public funds is needed to ensure that additional pub- to Reduce Capture." World Bank Policy Research Work- lic resources reach rural facilities and the underserved ing Paper 3239, March. poor. Further Reading The down and outward flow of resources can Ritva S. Reinikka and Jakob Svensson. 2004. "Local Cap- be enhanced at many levels ture: Evidence from a Central Government Transfer The two studies suggest that the addition of a few pol- Program in Uganda." Quarterly Journal of Economics icy mechanisms would greatly improve the transfer of 119(2): 679­705. public funds. A set of clear allocation rules at the min- Deon Filmer, Jeffrey S. Hammer, and Lant H. Pritchett. istry level about materials and medications to regions 2000. "Weak Links in the Chain: A Diagnosis of Health and districts would reduce the discretionary capture Policy in Poor Countries." World Bank Research Ob- by regional and district administrators. Better record- server 15(2): 199­224. Human Development and Public Services Research econ.worldbank.org/programs/hd_and_public_services