Cost efficiency in maternal and child health and family planning service delivery in Bangladesh: implications for NGOs

The main goal of the health reform programme recently initiated in Bangladesh is to reduce costs and improve cost efficiency of the service delivery systems, and thereby ensure the sustainable provision of essential health and family planning services. With significant dependency on external funding, attainment of this objective is more critical for non-government organization (NGO) programmes. The paper analyzes costs of the NGO service delivery systems for maternal and child health and family planning, and identifies areas for increasing efficiency, especially through reducing labour costs and increasing service outputs. The operations research on cost analyses was conducted within the health and family planning programmes of a leading NGO, using the ‘ingredients approach’. The findings demonstrated a significantly high proportion of personnel costs in field (outreach) service delivery systems, ranging between 70–85%. More than two-thirds of the working time of providers was spent on support activities, personal preoccupations and idle time. Simulations of various cost reduction options showed that considerable efficiency gains were possible through the combined effects of lowering personnel costs for field activities, increasing service outputs at the clinics, and ensuring more efficient use of providers' time. However, these factors, neither separately nor in combination, resulted in any substantive decrease for certain clinic services (e.g. antenatal care), implying the need to subsidize these services. The findings of the operations research indicated that cost analyses could be an effective decision-making tool for NGOs in developing cost-efficient service delivery strategies.