The Link Between Health and Domestic Resource Mobilization
As a continent, Africa has lagged behind developmentally for far too long. The good news is its modern leaders are dissatisfied with the status quo and are eager for changes that will propel African nations towards a new age of technological advancement and economic power. Despite this significant shift in mindset, however, most countries have not achieved their Domestic Resource Mobilization (DRM) aspirations and are still largely dependent on foreign aid.
This year, 2022, AIDS Watch Africa stated, “Africa is home to 16 percent of the world’s population. The continent accounts for 26 percent of the world’s disease burden yet receives just one percent of global health spending. As a result, 11 million Africans are falling into poverty every year due to high out-of-pocket health spending.”
Overreliance on private spending and foreign aid is now being recognized as detrimental to the continent’s efforts to efficiently fund its health system. In 2017, private funds were the largest source of health financing in more than half of African Union (AU) member states. According to global think tank, ODI, official development assistance still accounts for more than 20 percent of total health spending in 20 of 55 African countries. The situation is dire but not impossible to turn around.
The African Union, it its 50-year development plan called Agenda2063, states that Africa shall be a prosperous continent, with the means and resources to drive its own development, and where African people have a high standard of living and quality of life, sound health and well-being. This plan includes reference to DRM and trade as solutions to Africa’s economic and structural transformation. The plan also calls for a ‘paradigm shift’ towards African-led initiatives for funding disease responses that will have little to zero dependence on foreign aid.
In line with Agenda2063, The Africa Health Strategy, 2016-2030, emphasizes that sustainable and reliable health financing mechanisms are essential to build viable health systems. Without proper health financing, the Universal Health Coverage (UHC) will remain a utopia.
The Africa Leadership Meeting – A Catalyst for Change
In February 2019, President of the Republic of Rwanda, Paul Kagame, hosted the African Union at the Africa Leadership Meeting- Investing in Health, in Addis Ababa, Ethiopia. This initiative had a primary agenda of developing effective tools and working with African countries to increase their domestic expenditure on health. Its goals include ramping up efforts to eradicate HIV/AIDS, TB, malaria, and other pandemics, in order to achieve the Sustainable Developments Goals (SDGs).
One major tool that was innovated at the Africa Leadership Meeting (ALM) is the Health Financing Tracker. This tool monitors and tracks progress across the continent in several ways: Efficiency, equity, more money for health and more health for the money. There is also a significant focus on shifting countries to digitized public health systems. In addition, the ALM aims to facilitate the creation and management of health financing hubs around the regions. Defined as the effective center of an activity, region, or network, these hubs will support countries through their reform processes, coordinate development efforts, and provide a benchmark for access to support.
Several milestones have been achieved ever since the ALM was signed. One was that in July, 2019, during The Pan African Parliament Summit in Brazzaville, Congo, parliamentarians pledged their support to the ALM. In August of the same year, the Specialized Technical Committee on Health, Population and Drug Control (STC-HPDC 2019) convened in Cairo, Egypt. Other than table several policies and workable solutions to the health funding problem, the body also endorsed the ALM tools and further endorsed the digitization of the Africa Scorecard on Domestic Financing for Health, and the tracker.
In that same month of August, 2019, the STC-HDPC invited African Union member states to participate in the Global Fund Replenishment Cycles and Conference in Lyon. A total of 24 AU states responded to this call to action and pledged a total of $75.2 million dollars from within Africa alone. This was a 90 percent increase in Africa’s pledges from the 2017-2019 Replenishment Cycle.
The year 2020 saw several more conferences and meetings held around the continent where the ALM was prioritized. The momentum to create an Africa that’s self-sufficient in its public health systems has not ebbed. The correlation between a healthy population and an industrious and prosperous continent is far too great and pivotal to ignore.
Africa’s Collective Progress
Many countries have put in place mechanisms to protect the poor and vulnerable population groups, including measures that waive or reduce user fees at points of access within health service centers. Evidence has shown that for these measures to effectively increase the provision of quality health services, system-wide investments are required such as support from individual states in reimbursing health facilities where revenue is being lost during the process of making health services accessible to grassroots populations.
Also, the provision of Information Technology (IT) service points in health centers ensures that African countries start to move away from outdated methods of service delivery and customer care. Interactions between ministries of finance and ministries of health are also being enhanced through inter-ministerial committees, policy-oriented bodies, and information-sharing institutions. Though external funding will remain critical, the continent is now vigorously seeking to generate its own resources to improve its DRM.
Continentally, the Addis Ababa Financing for Sustainable Development Conference laid out a financing strategy that included the Addis Tax Initiative (ATI) to accelerate progress on increasing DRM. The initiative’s website https://www.addistaxinitiative.net/about highlights that the ATI aims to promote fair and effective domestic revenue mobilization (DRM), policy coherence and the social contract through partnerships and knowledge building. The site states, “As a multi-stakeholder partnership, the ATI plays an essential role in fostering collective action to improve tax systems in light of recognized gaps in development finance. Economic expansion around Africa will determine whether domestic funding increases, decreases or stays at the same pace as the per capita income. The outcome will vary from country to country.”
Recently, Nigeria has been a beacon of hope through its adherence to its Basic Health Care Provision Funds Program (BHCPF). Through this program, Africa’s most populous country is committing to providing basic health care, polio immunization, and COVID-19 vaccinations to at least 70 percent of its population. To guide the implementation of the BHCPF, an operation manual was signed by various entities in December 2018, with the government releasing over 66 million dollars from the earmarked 123 million dollars in January 2019.
Despite the positive achievements recorded in implementation so far, the BHCPF has had some hurdles such as poor cooperation between the implementing entities, inconsistent allocation and release of funds, and under-utilization of funds that have been disbursed. It is also not clear how the country will meet the estimated 5-billion-dollar annual target required to provide the BMPHS to all Nigerians.
Policy document, State of Health Financing in The African Region, also provides significant hope. It states, “Several African countries have recently implemented successful health financing reforms. For example, Ghana has moved from out-of-pocket payments to the use of prepaid and pooled funds; Botswana is looking at policy options for creating efficiencies that will help sustain its achievements and prepare for future challenges, and Rwanda has implemented a national health financing mechanism that covers the vast majority of the population and has been a key element in increasing access to health services. Many other African countries are looking for innovative ways to improve funding for health.”
In June, 2020, a virtual meeting of African Ministers of Health and Finance was held. The main agenda was to address COVID-19’s social and economic effect on the African continent, and to charter a continental response to halt the spread of the disease. An African Union press release from this meeting made the bold and exciting announcement that AUC Special Envoy Mr. Strive Masiyiwa, had introduced the Africa Medical Supplies Platform, a continental platform for the pooled procurement of medical supplies for member states. In effect, the Africa Medical Supplies Platform represents fresh possibilities, not only in effectively curbing COVID-19 but other health crises as well.
It’s important to note that DRM needs to have an improved supply chain when it comes to the dissemination of resources to health centers. The processes for service and product (medication, testing kits, and other necessary resources) provision are still largely ineffective and lengthy. A speedy and well-functioning supply chain will be a huge step in the attainment and maintenance of a modern and competitive health system in Africa.
The continent now has a universal hunger for economic, social and political progress. With regional initiatives such as the ALM, Africa can and will become a powerhouse for effective and innovative health care.