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Programmes that work in areas where the poverty levels are high have an inherent difficulty in increasing revenues without compromising on effectiveness. In Bihar, 40% of the population lives below the poverty line, and utmost care needs to be taken when attempts to raise resources are made. Janani has adopted a two-pronged strategy to increase resources: • Add more products to raise revenues and to spread distribution costs Janani’s experience with the latter has been mixed. Price revisions with non-clinical products like condoms, oral contraceptives, pregnancy tests have not resulted in any significant change in consumer off-take. With clinical services, however, the situation was vastly different: an increase ranging between 20 and 30% reduced caseload by 17% and couples protected by 14%. Janani’s programme is caught in a bind as the franchisees’ pressure to increase prices will have to be offset against the danger of leaving out some very poor and needy clients from the programme’s purview. In fact, finding the line that divides these two needs is a challenge that the programme faces. Before raising the prices of clinical services, Janani undertook a willingness to pay study in its own clinic in Patna in February 2003 and, using the experience, integrated a component in a market research study through a professional agency to cover rural and urban clients across Bihar and Jharkhand. The Patna study was conducted among 350 clients on the basis of the manual developed by the Population Council. The market research study had a sample of 2,009 respondents from 39 districts of Bihar and Jharkhand. The results led to an increase in prices from April 2003, varying between 20 and 30%. After six months of implementation, the revenue had increased 11% at the clinics but caseloads dropped 17% and couples protected dropped 14%. Deconstruction of data service-wise indicated, for instance, that female sterilizations had dropped 33%, injectables 32% and safe abortions 18%. Only IUDs went up 22%. Janani was concerned that most dropouts were from the poorer segments and hence needed to be brought back into the programme. Further cost adjustments were made so the prices were still higher than earlier but less than revised. Over the next six months, the caseloads rose though still continues to be marginally lower. The clinic, however, has become financially self-sufficient. Janani has also initiated a metric to regularly track inflation on the basis of a basket of commonly used products and commodities. Prices of these items of daily use among the poorer segments --salt, tea, soap, oil, matchbox and the like—are tracked every quarter. The rate of movement in prices of these items will alert Janani to the need to adjust the prices of its products and services. |
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