Achieving Greater Control Over Resources

Achieving greater control over resources depends on a sound financial management system that permits cost revenue accounting and often includes "alternate financing mechanisms," such as user fees and private sales of contraceptive products and services.

Reduce program costs

Compare the costs of alternate program strategies

As many family planning services are provided by medical professionals, they tend to be delivered through stationary facilities, such as clinics and health posts, which have high fixed costs in staffing, rent and utilities. Family planning managers should look at community-based or retail outlet-based models of service delivery, which may be more cost-effective, especially in areas where the population is dispersed or where traditional healers are still the predominant source of health care.

Use more para-professional staff or volunteers

Many family planning services use highly-paid medical professionals. Research has shown that nurses can perform many of the tasks traditionally done by doctors, including sterilization and insertion of IUDs, and community health workers can do many of the tasks assigned to nurses' aides or social workers. While initial costs may rise because of increased training needs, over the long run, lower personnel costs will significantly reduce program expenses.

Review costs and budgets carefully

Costs can be cut at the planning stage by carefully reviewing the line items in all budget categories. Managers must demonstrate that each item is absolutely necessary for achieving the objectives of the program.

Monitor costs carefully

Managers at all levels must consistently monitor costs as they occur. Managers must be trained and willing to challenge costs that seem excessive or unnecessary. The key strategy is to create a work environment that encourages cost savings. Staff at all levels will get the message that resources are scarce and that it is important not to waste them. Each central and regional office must appoint someone to regularly review the purchase orders, vouchers, and petty cash receipts.

Seek savings in wholesale purchasing agreements

If you have adequate storage facilities, purchase as many supplies as possible in large quantities and try several sources to get the best possible volume discount. In addition, you can explore the possibility of coordinating with other providers to purchase supplies in bulk and share the savings.

Use appropriate technology

In the field of family planning, the most common violation of this principle happens in the provision of voluntary sterilization services. Some doctors prefer the more expensive procedure of laparoscopy as opposed to the more appropriate technology of minilaparotomy. Laparoscopy involves the use of expensive imported equipment, for which there are usually no spare parts in developing countries. Minilaparotomy can be done under local anesthesia and with widely available surgical instruments.

Reduce staff turnover

Staff turnover causes significant hidden costs to a program because resources are wasted when trained staff leave, and because additional resources must be invested in hiring and training replacements. In family planning programs, this problem is most serious among community-based family planning workers. In general, you can reduce turnover among CBD workers by choosing workers whose children are older, who are enthusiastic about the benefits of family planning, for whom the CBD program is not their primary source of income, and who are interested in playing a leadership role in their community. Other measures to reduce turnover among CBD workers include regular and supportive supervision visits and both monetary and non-monetary incentives for good performance.

Develop cross subsidies

Two major goals of a sustainable organization may appear to be contradictory: increasing services to poor and underserved populations, and increasing the level of self-financing (increasing the proportion of locally-generated revenues as opposed to donor revenues). Managers may think that in order to fund programs for the poor and underserved, they must rely on donor funding. Although donor funds are usually an option, when donors reduce their level of funding, managers are required to explore other options. One option that some family planning organizations have found successful is cross-subsidizing, which means using monies generated in one area or service to cover the costs in another area or service. Essential to successful cross-subsidizing is information on the costs of services and the pricing policies for those services. Family planning organizations need to know the real costs of services, whether family planning or pediatric, and the per unit cost of delivering services in each of the service delivery points in the program. Managers then consider real costs, client incomes, and market considerations to determine appropriate prices to establish a successful cross-subsidy scheme. Three of the strategies available for cross subsidization have proven to be particularly useful for family planning organizations:

From service to service

Family planning organizations can subsidize family planning services by using profits generated by related services which clients want and are willing to pay for. When providing such services as sonograms, laboratory tests, and gynecological services, programs can charge fees higher than the costs of the service and can channel the profits into providing family planning services.

From clinic to clinic

Clinics in urban areas often serve clients who are better able to pay the full cost of their services; indeed, some clinics have been deliberately situated so as to both meet client demand and generate a profit for the organization as a whole. Profits from such clinics can be used to subsidize other clinics, usually rural, where the clients are poorer and the costs of providing quality services are higher due to additional costs of transporting staff and supplies.

From client to client

Sliding fee scales, which charge clients according to what they say they are able to pay, are a relatively simple way of subsidizing services for poorer clients by using fees collected from middle class clients. In Latin America, sliding fee scales have been simple and effective. The fee scale is set for each community according to the conditions there, rather then in terms of absolute income which may be difficult to estimate or verify. During the first visit, clients identify themselves as A, B, or C. "A" clients pay more than the cost of services, thus generating profits to subsidize the costs of serving poorer clients who are unable to pay the full costs services. "B" clients might pay in full or in part, while "C" clients pay nothing.