In response to low utilization and the community’s lack of confidence in Basic Health Units (BHUs), the Government of Punjab and the District Government of Rahim Yar Khan (DGRYK) signed a memorandum of understanding (MOU) in March 2003 with a national NGO, the Punjab Rural Support Program (PRSP). PRSP was given the contract without any competition, reflecting the fact that its establishment had been partially funded by the Government of Punjab and the Government felt confident giving it public funds. The MOU gave PRSP the responsibility for managing all the BHUs in Rahim Yar Khan (RYK) District. RYK is a relatively poor and under-performing district in southern Punjab. The District Department of Health (DOH) provides services to the 3.3 million people of the district through one District Headquarters Hospital, four Taluka (sub-district) Headquarters Hospitals, 16 RHCs and 104 BHUs besides a few rural dispensaries and maternal and child health centers.
The 5-year MOU gave PRSP: (i) administrative and financial control to manage all the 104 BHUs with considerable autonomy to implement organizational and management changes; (ii) authority over all BHUs buildings and equipment; (iii) existing staff were made available to PRSP and the NGO could request DGRYK to transfer staff if necessary; (iv) autonomy to purchase drugs and other supplies; and (v) the same amount of budget, as a single line transfer on a monthly basis, that had previously been allocated for all the BHUs, i.e., about $900,000 per year.
PRSP introduced a number of innovations in RYK, including: (i) recruitment of managers on contract who were paid market-based salaries but also held accountable for results; (ii) formation of a cluster of three BHUs with one medical officer in-charge responsible for the management of the BHUs; (iii) enhancing the salaries of medical officers in-charge by about 150%; (iv) development of community support groups for BHUs; and (v) improving the physical condition of BHUs through repairs and maintenance financed with additional resources from the District Government through each local union council. In addition, it aimed to improve the supply of drugs available in the BHUs without increasing the budget. Based on the perceived success of the RYK experiment, the approach was expanded to 11 other districts in the Punjab and, subsequently, to another 34 districts in other provinces of Pakistan.