With the introduction of the National Rural Health Mission (NRHM) in 2005, the rural primary health sector received a significant financial boost—one that was a long time coming. Since its launch, the Union government allocations for NRHM have more than doubled from Rs6,788 crore in 2005-06 to Rs14,178 crore in 2009-10. A crucial objective of NRHM is to engineer an “architectural correction” of the way health services are delivered. Two innovative features that NRHM introduced were to decentralize the delivery system by creating district- and village-level health societies and empowering them with discretionary funds; and providing conditional cash transfers directly to pregnant women to incentivize institutional delivery under the Janani Suraksha Yojana (JSY). How effectively have these innovations been implemented? Expenditures tell a sobering story.
Before getting to the specifics, it is necessary to introduce a caveat. Detailed expenditure data on NRHM is not easy to obtain because of complex and haphazard reporting procedures, but broad trends can be ascertained.
Now the details. First, the discretionary funds. An important element of the discretionary funds is the provision of an untied and maintenance grant component to district societies for expenditure at the local public health facilities. District societies comprise panchayat (village council) members, medical officers and representatives of the wider community, among others. Decisions on expenditures are made by these societies and funds sent to the local facilities on this basis. Expenditure performance on untied funds is poor. Bihar, for instance, has spent a mere 11% of its untied funds while Madhya Pradesh, a relatively high-spending state in NRHM, has spent only 29%. Some of these funds are also meant to go to village-level societies. Anecdotal evidence from most states indicates that these societies do not function effectively (in some cases, they haven’t been formed) and, most often, funds remain unspent.
A recent evaluation of NRHM by the Planning Commission looked at untied and maintenance funds in Rajasthan, Bihar and Uttar Pradesh. The study reports that when funds are spent, they usually go towards fulfilling basic infrastructure needs at the health facilities. It also indicates that officials and society members have a preference for using funds on suggested items identified in the rules rather than exercising their discretion, defeating the very purpose of the discretionary provision. This is a clear indication of a capacity gap at the implementation level.
Weak implementation capacity is, of course, not a problem limited to NRHM. In most social sector programmes, money for infrastructure tends to be used faster than that on “softer” needs that can contribute to improving services precisely because of limited capacity and understanding at the local level.
The implementation of JSY has seen some success in promoting institutional delivery. Overall, the number of JSY beneficiaries has risen from 739,000 in 2005-06 to 8.38 million in 2008-09. There are, of course, state-wide variations. A 2008 study of Rajasthan, Bihar, Madhya Pradesh, Orissa and Uttar Pradesh funded by the United Nations Population Fund (UNFPA) found that JSY beneficiaries were the highest in Madhya Pradesh and Orissa; the two states had institutional delivery rates of 72% and 68%, respectively, and 67% of them were JSY beneficiaries. In Bihar, on the other hand, the institutional delivery rate was only 49%, of which 41% were JSY beneficiaries. JSY expenditures accounted for 11% of NRHM allocations in 2008-09 and the wide disparity between Madhya Pradesh and Bihar illustrates that expenditure increases alone do not translate into intended outcomes.
Part of the explanation lies in implementation inefficiencies. According to JSY rules, beneficiaries ought to be given their funds at the institution, usually at the time of discharge. However, this rarely occurs, which defeats the intended incentive effect of the scheme. In Bihar, the UNFPA study reveals that a mere 8% of beneficiaries received their money at the time of discharge while Orissa topped the list at 20%. Anecdotal evidence suggests that these delays are usually a consequence of bureaucratic inefficiencies, including problems such as lack of funds and corruption.
Clearly, NRHM has a long way to go before its “architectural correction” efforts can take root. But whether this architectural correction will enable real improvements in delivery is still an open question. Despite the increase in budgetary allocations and the attempt to alter implementation mechanisms, the corrective measures in NHRM simply do not go far enough. The crux of the primary healthcare sector are its human resources—medical officers, paramedics, and doctors, most of whom operate in institutional environments that severely compromises their accountability to citizens. Doctors, for instance, are hired, paid, monitored and, therefore, accountable only to the state government, and given that performance is delinked from pay and that monitoring by the state government is weak, they have few incentives for providing quality care. Real architectural correction will require political will to tackle this issue. Till then, increased expenditures through NRHM will still simply be an effort in tinkering at the edges.
Yamini Aiyar is a senior research fellow and director of the Accountability Initiative of the Centre for Policy Research.
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