Health systems efficiency and child health status: Policy implications for India

Although child health has improved significantly over the years, three of the ten most important conditions that contribute to the global burden of disease are still childhood diseases. Despite significant improvements in overall health status, India is lagging behind in terms of overall health status of children. In India, approximately 1.72 million children die each year before reaching their first birthday. Due to relatively low socioeconomic development of the country, child health indicators have remained quite poor for India. Moreover, the interregional disparity in child health has remained high and may have become even worse over the last few years. India needs to tackle not only the overall poor child health status but also the wide regional and socio-economic disparity that exists.

To improve health status of population, countries like India have two general options; (i) increase the level of resources available to health and/or (ii) improve the efficiency of health resources being used. In a resource poor country like India, increasing total resource availability in the health sector will be relatively difficult and slow. Irrespective of the level of resources available, it is important to use the existing resources in a more efficient manner. Substantial progress could be accomplished with better efficiency, both at national and sub-national levels. It is also possible that improving efficiency of the health system (in terms of child health outcome) may help lower socio-economic disparities in health.

The purpose of the proposed research is to compare the effect of various factors in determining child health and gender disparity in child health status between relatively efficient and inefficient state health systems.

This study aims to (1) identify states/regions that appear to be less successful (inefficient) in improving child health status over time in an efficient manner, (2) identify factors that can help improve child health at a relatively rapid rate in poor performing states, and (3) the effects of potential determinants of child health in relatively efficient and relatively inefficient states.

The proposed research will address the following research questions: - (1) How are Indian states performing in terms of their efficiency in producing child health? (2) What are the determinants of child health in relatively efficient states and relatively inefficient states? (3) Do determinants of child health differ between efficient and inefficient states? (4) Is gender disparity in child health high in relatively inefficient states compared to relatively efficient states?

The proposed study is conducted at two levels. At the first level, efficiency of 25 major Indian states in the production of “child health” is measured using a method proposed by World Health Organization (WHO), which estimates the maximum level of health output achievable from specific levels of inputs. The deviation from the highest output achievable is used to estimate the inefficiency coefficients for the states. By definition, the most efficient state has an efficiency score of 1.

The focus of second level (individual level) of analysis is to study (1) the current determinants of child health among groups of relatively efficient and relatively inefficient states and (2) the effect of efficiency status of state on gender disparity in child health among relatively efficient and relatively inefficient states. The Demographic and Health Survey (DHS) (1998-99) for India will used for in-depth analysis to study the determinants and causes of gender disparity in child health among relatively efficient and relatively inefficient states. The DHS data contains maternity histories of women aged 15-49, and a variety of maternal/child health and household variables which will be used to conduct analysis for this research. DHS survey collected information on a number of indicators of child health like feeding, health care, and nutritional status for children born in the three years preceding the survey. DHS 1998-1999 for India has data for 25 major Indian states. Child and household data files will be used for in-depth individual level analysis for four Indian states - 2 relatively efficient states (Kerala and Manipur) and 2 relatively inefficient states (Orissa and Madhya Pradesh) based on their efficiency scores.

The unit of analysis for this research is the child. Nutritional status a major measure of the health and well-being of children will be used as the outcome variable. Z-scores for nutritional indices (weight-for-age, height-for-age and weight-for-height) serve as dependent variables for this study. Potential socio-economic, demographic, and maternal health care variables will serve as input variables for this analysis. Dummy variables for efficiency status of states and gender of the child will be created and interaction between the dummy variables and other key variables will be generated. Ordinary least squares (OLS) models will be estimated to identify the potential factors affecting child health status of boys and girls among relatively efficient and relatively inefficient states. Test of significance will be applied to test the statistical significance of key determinants of child health, and to test whether the magnitude of the effects of these determinants are significantly different in relatively efficient versus relatively inefficient states.

Efficiency scores for 25 Indian states were estimated from state-level data for the years 1998-2001. Child health status was measured by infant mortality rate. Various socio-economic variables were used as explanatory variables. Fixed effect coefficients are used to rank states in terms of efficiency. Demographic and Health Survey data (1998-99) for two relatively inefficient states has been used for the in-depth analysis to identify the determinants of child health.

Madhya Pradesh and Orissa are found to be the two least efficient states in India in terms of child health production. Female literacy, sex of the child, and income are significant determinants of child health in relatively inefficient states. Improving maternal education, reducing gender disparity and economic development should be able to improve child health but even a very high rate of economic progress alone will not able to improve child health status significantly in the poor performing states. Therefore, economic development policies must be complemented with social development interventions to ensure improvements in child health within a short period of time. Such policies will also be helpful in improving child health in other relatively more efficient states of India as well.

Substantial levels of monetary and other resources are being invested to improve the child health status in India with very little success achieved to date. International donors, policy makers at national and regional level and various non-profit agencies working in the area of child health often face major challenges in improving child health status. Research findings from this research will be helpful to international donors (who invest money in various programs to improve child health status), officials from Ministry of Health and Family Welfare (who are accountable for the progress of child health at national and regional levels), and various non-profit agencies (who work at the grass roots level to render services which aim to improve the child health status).

Efficiency indices indicate if the resources are used most efficiently in the production of health outcomes. Measurement of efficiency is of considerable significance to policy makers. First, it draws attention to the fact that a region or a particular state may be able to achieve a higher level of overall health status without increasing its resource allocation to health. Second, with measurement of efficiency, it is then feasible to investigate exogenous determinants of efficiency: it may be possible to identify, for instance if low efficiency are related to factors such as low government effectiveness, high income inequality, or particular ways that the system is organized or financed.

Results from this research will provide insight about the performance of states across India in producing child health. This research project will also indicate gender disparity in child health status over time. Since the policy makers emphasize efficient delivery of health services, this study will be able to demonstrate if improvements in efficiency alone would have any impact on gender disparity. Also, factors affecting gender disparity may vary between relatively efficient and relatively inefficient states; the analysis would be able to identify the important policy variables that affect child health disparity by gender and socioeconomics in these two groups of states.