Rethinking healthcare costs

By Sarah Namulondo

Dr Ian Clarke advocates changes in health sector salaries, budgeting and operations. Others in corruption-ridden sector protest.

Even if it happened over a year ago, David Mugerwa, a smallholder farmer in the rural Luwero district of central Uganda, recounts the day his wife and newborn baby died at Nakaseke Hospital like it was yesterday.

With teary eyes, he told acommunity health monitoring project review session in Kampala on Oct.17 that trouble started as soon as they arrived at the government hospital at 11am on May 5, 2011. They found no doctor to attend to his expecting wife even if her labour had started.

With fresh tears in his eyes, Mugerwa narrated how his wife started bleeding and the nurses said she needed to be operated. Two doctors who would have done the caesarian and were supposed to be on duty were away; one in Nakasongola and the other in Kampala. The nurses called them about the emergence as they desperately continued giving her labour inducing fluids which, unfortunately, caused even more bleeding. Hours later, one of the doctors returned and operated on her but it was too late. His wife and baby died at 7.30pm, eight hours from their time of arrival.

The health sector review at which Mugerwa spoke was held a few weeks after MPs threatened to block the government budget unless Shs 260 billion was added to the Shs 838 billion budget of the Ministry of Health to give doctors a pay rise. In the end, they got Shs 6.5 billion more for Health and Shs 43 billion more was promised.

An off-shoot of this debate, however, has been recognition of the need to strengthen the link between the government’s expenditure on health and the quality of the sector outputs.

Several questions are now being asked; would the doctors who ignored Mugerwa’s wife become more committed to their job if they are paid better? Does it make sense to increase doctors pay without raising that of nurses and other medical workers? Will increasing pay result in better healthcare in medical facilities that if better equipment, drugs, and other utilities were provided in the short-term?

The Chairman of International Medical Group in Uganda, Dr Ian Clarke, who runs one of the best private hospitals in Uganda; International Hospital Kampala (IHK), has spent over 30 years pondering these questions.Having started his private practice in Uganda in rural Luweero, Dr Clarke is uniquely positioned to offer solutions.

Mugerwa’s case, although unique because of the media attention it has received, would not be unusual to Clarke because maternal deaths are quite high in Uganda where lifetime risk of death for a pregnant woman in Uganda is 1 in 35 according to the 2011 UDHS report. About 435 women die per 100,000 live births according to UDHS. In 2010, the number was 438 deaths. Most of these occur in rural areas and are rarely reported since most attention goes to urban health care.

Higher salaries?

So what drives Dr Clarke’s view that low salaries are not the problem and increased pay for a doctor is not the solution? It’s a question of priorities, he says, adding that emphasizing better salaries for health workers ahead of required policy reforms will not deliver better health care.

“Salaries should be at the bottom of the sector budget,” he says.

BillbestBakirese, a Senior Planner at Mulago Hospital, disagrees. He says under-estimating the importance of good salaries for medical staff would be a big mistake. While conceding that wages consume a huge chunk of the budget; 70% in case of Mulago’s Shs 40 billion budget in the 2012/13 projections, he says consultants, doctors, and nurses have left the hospital over low pay. He says, however, the government needs to increase the overall health budget.

The starting salary of a doctor in Uganda is currently Shs 550,000 (Approx. US$200). Additional allowances push that to Shs1.2 million (Approx. US$480).

That is not very different from Rwanda where minimum pay for a doctor is of Rwf350, 000 (Approx. US$531), Kenya US$470, and Tanzania US$500. Although exact salary figure are difficult to find and pay varies depending on rank, duration in service, and allowances, it is clear that the trouble for Uganda appears to be the perception that doctors elsewhere earn considerably higher salaries. It will be interesting to see how the medical fraternity will react since the government has announced a pay rise across board starting January 2013, with the minimum salary of a doctor set at Shs2.5 million (Approx. US$1000).

Value for money

This is not the first time the government is throwing money at problems in the health sector. Statistics indicate that government expenditure, minus donor project-specific contributions like GAVI, and Pepfar, has risen about 300% from Shs 219 billion ten years ago to Shs 838 billion currently.

Health indices that attempt to assess the return on investment in the sector, like the ministry Health Sector Policy II (2010-2020), the UN Millennium Development Goals, and the National Development Plan, show a mixed bag of results.

Teddy Anjiga, a senior statistician at Mulago Hospital, gets really sombre as she explains that it is unrealistic for government to expect efficient implementation of the MDG’s in line with mother to child health care when there are about 44,009 nurses serving a population of 35 million. She says staffing level has gone down and the nurse to patient ratio of Mulago labour ward is between 1:5 and 1:10 delivering mothers. Nationally, the nurse-patient ratio is 1:17,000 against the World Health Organisation recommended ratio of 1:400.

Uganda’s doctor to patient ratio still stands at 1:15,000, way below the recommended World Health Organisation ratio of 1:10,000 for Africa. According to the Government policy framework, the target is to have the ratio drop to 1:12,000 by 2015.

Over the past 10 years, vaccination coverage of children age 12-23 months has increased from 29% to 40% in 2011. Infant mortality is down from 76/1000 to 54/1000 and the under-five mortality from 137/1000 to 90/1000 by 2011.

But maternal mortality has stayed stubbornly high at around 310 per 100,000 live births in 2010 which is one of the highest rates in the world.

It is a drop, however, when compared to the 1990s estimates that put it in excess of 500 per100, 000 births. But if Uganda is to attain the MDG target of a three fourths reduction over the period 1990–2015  it needs to reduce its maternal mortality ratio to 131 deaths per 100,000 live births by 2015.

One in every 19 Ugandan children still dies before their first birthday, and one in every 11 children dies before the fifth birthday.

Another intervention in the health sector which illustrates the controversial nature of outputs has been the National Medical Stores (NMS) which the government introduced to curb runaway theft of drugs and medical supplies.

Dr Clarke is a huge fan of NMS’s push-pull whereby it delivers drugs on order by a medical facility. But Bakirese says there are problems with NMS that many people are afraid to talk about. He says its network is urban-oriented since it has no branch network and operates out of faraway Entebbe. Other critics say NMS delays in drug delivery which is wasteful as the drugs expire with time. In this case, the disagreement is quite logical as Dr Clarke’s operations are just around the corner from NMS and, as he says, the moment he places an order, the trucks roll up with them.

Govt expenditure on health sector (minus donor support)

• 2012/13 — Shs 838 billion
• 1997/98 — Shs 58 billion
• 2003/04 —- Shs 219 billion
• 2004/05 — Shs 237 billion
• 2005/06 — Shs 240 billion
• 2006/07 – Shs 243 billion
• 2007/08 — Shs 275 billion
• 2008/09— Shs 275 billion

Average: 12% of budget

System collapse

Still, Dr Clarke maintains that poor leadership and a payment system that is not result oriented, is what needs to change. He wants the government to return to the cost- sharing model and introduce a voucher-based service.

He says one of the highest forms of wastage in Uganda’s public health system involves assigning medical professionals to grassroots facilities like Health Centre II or III with limited equipment.

“What will be that doctor’s role?” he asked. He said most doctors love working at his IHK because they have equipment.

He told The Independent that the top down approach, which has been in place in the last 15 years and focuses more on the urban national referral and general hospitals than on the rural grassroots health centres is also to blame.

“This approach seemed to work well but it can no longer cater for health output since it collapsed four decades ago,” he says, “the disease burden has shifted 80% to the rural areas.”

A World Bank study in 2008 found that 80% of Uganda’s health budget is spent on hospitals in urban areas that serve only 20 percent of the population. It also found that 80% of public sector medical workers in Uganda work in urban areas where only 20 percent of the population lives.

Ironically, however, a 2006 National Household Survey showed that although 76 percent of all hospitals and health centres are government-owned, only 22% of Ugandans seek medical care from them. The majority, 46%, go to private or NGO clinics, while 12% self-treat.

Clarke says the poor outputs problem, which permeates all public sectors in Uganda, is caused by a complex mix of bureaucracy, limited human resources and infrastructures, corruption, low budgets, motivation, and facilitation.

Who assesses doctors?

He explained that health sector outputs are low compared to inputs because medical workers perform poorly because they do not have specific targets to achieve but do routine work. To change that, he wants the government to introduce a voucher-based service in which patients would get vouchers and give them to the person who attends to them. Medical workers would then be paid based on the vouchers they collect.

Using the expectant mother to illustrate, Clarke said she would get a voucher from the clinic where she takes antenatal care, and when she’s ready to give birth, she would give the voucher to the midwife who assists her with delivery. At month’s end, the midwife would be paid based on the number of deliveries she has done. He believes such a system will drive nurses, midwives, doctors and consultants to be more productive without the government imposing any new regulation or policy for the sector performance. Voucher-based systems have been piloted with mixed outcomes by NGOs in western Uganda.

Dr Clarke said the lack of clear accountability channels also lead to inefficiency and corruption. He criticised the current system where a nurse/doctor at lower health centers is hired by the ministry of Public Service, gets salary from the ministry of health, and is accountable to the ministry of Local Government.

“How is a District Chief Accounting administrator able to assess a health workers performance without knowledge on health,” he asked.

Poor planning

Dr Clarke blamed poor planning at the highest levels, including the nation’s biggest medical facility, Mulago National Referral Hospital in Kampala. Like the government facilities in urban areas that are stocked to avoid `politics’, Mulago attracts most patients who travel from their rural villages for treatment in urban areas. In turn, this rural-urban healthcare migration burdens the urban health worker and renders the rural health workers redundant.

Mulago, which receives over 160,000 in-patients and 200,000 specialised out-patient cases, 850 out-patients, and 60,000 emergencies per year, in fact, epitomises the challenges faced by the sector, including unusually high child and mother deaths, lack of drugs, poor or no equipment and workers.

Dr Clarke said Mulago’s primary function should be that of a referral hospital treating complex cases but poor planning has rendered it a general hospital treating every minor case. He blamed the tendency of Kampala Capital City Authority, where it is based, failing to formulated a single plan for the city health facilities. As a result, Naguru Hospital, the brand new facility donated by the Chinese government to relive Mulago lies idle years after it was handed over. Nationally, Clarke said, the government should stop putting all health money in the ministry budget and send it straight to each specific health facility.

Dr Lawrence Kagwa, who was Mulago’s director for 12 years and is an avid proponent of a unit-cost model similar to Clarke’s, says it will cut wastage and create targets for medical workers.

He adds, however, that it is difficult to reform the health sector, because unlike sectors like agriculture where farmers have clear expectation from every input, medical personnel do not.

He says during his time at Mulago he devised various ways of getting value-for money spent that included the unit-cost approach. Under this, he would break down the cost of providing a specific service to ensure cost effectiveness.

Using measles immunization as an example, he would consider the cost price of vaccine, transporting, refrigeration, and staff costs.

“Once you know all that, it is easier to budget and allocate money knowing the considered output you want out of the exercise,” he says.

Going forward, Dr Clarke wants the government to support the private public health sector by providing for them in the budget and subsidizing equipment based on the Public Private Partnership Paper signed recently.

Most radical intervention proposed

A nursing officer who registers and writes prescription for 300 patients daily suggested the following:

Install computer-based Public Usable Gadgets (which are like ATMs) so that the public can fill in their names and ailments and the machine gives them a statement that will help them find a prescription. This will decongest the hospital because in most cases patients need diagnosis. Doctors and consultants should come in where the machine fails.

The government spends too much money on unnecessary stationery when the information on paper is eventually computerized causing the I.T budget to be equally high.

The “passport”, the medical card given to expectant mothers in upcountry hospitals is huge and designed for four births. It is wasteful because most mothers get a new one for every birth.

The medical form is on an A3 paper with all disease types listed and is issued to flu or headache or even simple malaria. Solution: Use small medical form like those at Mulago and go digital.

Fact file

• Filled approved positions nationally – 58% and up from 56% in 2010.
• Filled approved positions for Mulago Hospital – 87% decrease from 90% in 2010
• Filled approved positions for Butabika Hospital – 93% from 85% in 2010.
• Filled approved positions in 13 referral hospitals – 72% up by 2% compared to 2010.
• Filled approved positions from 112 districts – 57%  from 53% in 2010.
• Filled approved positions from 40 general hospitals –  63% same as 2010
• Filled approved positions from 40 general hospitals (clinical officers) 94%)
• Filled approved positions from 40 general hospitals (laboratory staff)  79%
• Filled approved positions from 40 general hospitals (pharmacists) 15%
• Filled approved positions from 40 general hospitals (medical officers) 37%
• Filled approved positions from 40 general hospitals (anesthetic staff) 43%
• Filled approved positions from 40 general hospitals (dispensers) 45%)