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Impact of Petroleum Subsidy Removal on Health Care Sector in
Nasarawa State Nigeria.
LYAM, Msendoo Margaret, (MSc).
1
, Joseph M. IBBIH, PhD
2
1
Department of Economics, Nasarawa State University, Keffi, Nigeria.
2
Department of Economics, Nasarawa State University, Keffi, Nigeria
DOI: https://doi.org/10.51583/IJLTEMAS.2026.150600283
Received: 22 July 2026; Accepted: 27 July 2026; Published: 04 August 2026
ABSTRACT
The study examined the impact of petroleum subsidy removal on the healthcare sector in Nasarawa State,
Nigeria. The broad objective of the study is to investigate the impact of petroleum subsidy removal on public
health care delivery in Nasarawa State Nigeria. The study adopted a survey research design, both primary and
secondary data were used for the study. The population of 2,520 was used from which the sample size of 345
was determined using Taro Yamane formular. Logistic multiple regression analysis (logit regression model) was
employed to examine the relationship between the dependent and independent variables. The result revealed that
increased fuel prices have led to higher transportation costs, reduced access to medical services especially in
rural areas and a rise in operational expenses for hospitals and clinics. The study also revealed that the positive
and significant outcome for patients’ accessibility (p = 0.0026) suggests that as transportation fares rise, patients
find it increasingly difficult to visit healthcare facility. Therefore, the study recommended that the federal and
state governments introduce targeted subsidies or grants specifically for the health sector to ensure a continuous
supply of essential drugs, medical consumables, and equipment in public hospitals despite the rising cost of
energy and logistics. It also recommended that the government, in collaboration with local transport unions,
implement subsidized transport schemes or mobile health outreach programs in rural and semi-urban areas to
improve patient access to health facilities. The study concludes that while subsidy removal may promote long-
term fiscal sustainability, its short-term adverse effects on the healthcare sector are significant.
Keywords: Health Care Delivery, Patients’ Accessibility, Low-income Household Accessibility, Health Workers
Response, Availability of Essential Medical Services.
INTRODUCTION
Nigeria, a country endowed with vast natural and human resources, has for decades relied heavily on petroleum
as its economic mainstay. Since oil was discovered in commercial quantity in 1956, the sector has played a
dominant role in shaping the country’s economic and social policies. Crude oil exports account for over 85% of
Nigeria’s foreign exchange earnings and more than 70% of government revenues (IMF, 2020). Over time, the
country adopted a system of fuel subsidy designed to stabilize domestic fuel prices and shield citizens from the
volatile nature of the international oil market. However, this policy, while initiated to promote social welfare,
has evolved into one of Nigeria’s most controversial and economically draining strategies.
The petroleum subsidy regime in Nigeria was primarily aimed at making petroleum products affordable for the
average citizen. The government’s justification for the subsidy has always centered around protecting the poor,
stimulating economic activity, and maintaining social stability (World Bank, 2021). However, studies in recent
years have demonstrated that the subsidy has disproportionately benefited higher-income households who
consume more fuel, while the poorest groups have received minimal benefit (BudgIT, 2020). The subsidy regime
has been plagued by mismanagement, corruption, and lack of transparency, resulting in severe economic
leakages. According to NEITI (2021), Nigeria spent over N11 trillion on petroleum subsidies between 2006 and
2021, with limited accountability for how these funds were distributed.
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As economic pressures mounted due to falling oil prices, growing public debt, and increasing inflation, calls for
subsidy reform became more urgent. The removal of the subsidy was identified by economist and policy analysts
as a necessary step towards achieving macroeconomic stability and reallocating resources to more productive
sectors such as health, education, and infrastructure (World Bank, 2022). In May 2023, President Bola Ahmed
Tinubu announced the full removal of petroleum subsidies, marking a critical shift in economic policy.
The economic implications of subsidy removal are multifaceted. On one hand, the government expects to save
trillions of naira, which could be redirected to development sectors, including healthcare. On the other hand,
subsidy removal triggers inflation, increases transportation and production costs, and heightens the burden on
households, especially in a country where the majority live below the poverty line (NBS, 2021). This resultant
rise in fuel price typically led to higher food costs, increased transport fares, and elevated costs of basic services.
These ripple effects extend into the healthcare sector, where affordability and access are critically linked to
transportation, energy, and household income.
Nigeria’s healthcare system is already under immense strain. Public health facilities across the country face
chronic underfunding, shortages of medical personnel, poor infrastructure, and frequent strikes due to unpaid
salaries and poor working conditions. According to WHO (2022), Nigeria’s healthcare spending remains one of
the lowest in Sub-Saharan Africa when measured as a percentage of GDP. only about 3.7% of the national budget
was allocated to health in 2022, falling far short of the 15% Abuja Declaration benchmark. This underinvestment
directly contributes to poor health indicators, including high maternal and child mortality rates, limited access
to essential health services, and low immunization coverage (UNICEF, 2022).
The removal of fuel subsidies has a direct bearing on healthcare delivery, particularly in the public sector. Health
facilities in Nigeria rely heavily on diesel-powered generators due to inconsistent electricity supply. With the
rise in fuel prices, hospitals and clinics are now forced to spend more on energy, thereby reducing the funds
available for essential medicines, diagnostic tools, and patient care. Similarly, transportation costs for patients,
healthcare workers, and the delivery of medical supplies have surged, creating further access barriers. According
to a study by Akinwande and Olaniyan (2021), even a marginal increase in transportation costs significantly
reduces outpatient visits in rural communities, where public transport is often the only means of accessing health
services.
The public healthcare system in Nasarawa State is made up of primary health centers, general hospitals, and a
few specialist facilities, most of which are concentrated in the state capital, Lafia. Many of the rural health centers
struggle with inadequate medical equipment, undertrained staff, and poor infrastructure. With the increase in
fuel prices, health workers in remote locations report challenges in commuting to their duty posts, while patients
in rural communities’ face raising transport fares when seeking medical attention. These logistical barriers are
compounded by the rising cost of living, making healthcare increasingly unaffordable for the average citizen
(Yusuf & Salihu, 2020).
The implications for maternal and child health are particularly concerning. Rural women often travel long
distances to access antenatal and delivery services, and increased transport costs can discourage facility-based
births. This is worrying in a state where maternal mortality remains unacceptably high. Additionally, health
campaigns such as immunization drives and outreach services are becoming more expensive to implement, as
the cost of fuel directly affects mobility, cold chain logistics, and outreach planning (Adigun et al., 2019). These
challenges threaten to erode the modest gains made in healthcare delivery in Nasarawa State over the past decade.
From a fiscal standpoint, the promise of channeling subsidy savings into the health sector remains largely
theoretical. While federal authorities have emphasized reinvestment in critical sectors, evidence of actual
budgetary reallocation remains limited. For instance, in the 2022 budget, less than 8% of Nasarawa State’s total
expenditure was directed to health, with most of the funds going toward salaries rather than infrastructure or
service delivery (BudgIT, 2022). Without transparent and deliberate framework for redirecting subsidy savings
to public health investment, the reform risks widening health inequalities rather than closing them.
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Moreover, the broader macroeconomic consequences of subsidy removal such as rising inflation, food insecurity,
and declining real incomes have secondary effects on health outcomes. Malnutrition, already a significant public
health challenge in Nasarawa, is likely to worsen as households struggle to afford nutritious food. Stress-related
illnesses, increased vulnerability to infectious diseases, and delayed health-seeking behavior are also probable
outcomes in a context of economic uncertainty (Olayemi & Bello, 2021). These patterns underline the
interconnectedness between economic policy and public health outcomes, especially in fragile subnational
settings.
Statement of Problem
Nigeria’s petroleum subsidy regime has long been a subject of economic and policy debate, with its eventual
removal marking a significant point in the country’s fiscal and social landscape. While the decision to remove
the fuel subsidy was largely driven by the need to curb fiscal deficits and improve economic efficiency, its
implications for public service delivery, particularly in vulnerable sectors like healthcare, remain understudied
and inadequately addressed. The removal of fuel subsidies is expected to free up public funds, which could be
redirected to critical sectors. However, the realignment of these funds has often lacked transparency and
demonstrable impact on healthcare infrastructure and service delivery, especially in under-resourced areas such
as Nasarawa State (World Bank, 2022).
Healthcare delivery in Nigeria is already challenged by inadequate funding, infrastructure ‘‘‘deficits, and
inequitable distribution of medical personnel and facilities. According to the World Health Organization (2022),
Nigeria spends less than 4% of its gross domestic product on health, and only a fraction of this is allocated to
primary healthcare, which serves the majority of the population. The 2022 budget allocation to the health sector
in Nigeria, and by extension Nasarawa State, failed to meet the Abuja Declaration target of 15%, suggesting
systemic under investment (BudgIT, 2022). This chronic underfunding has led to poor health indicators,
including high maternal and infant mortality rates, low immunization coverage, and limited access to essential
healthcare services, particularly in rural and semi-urban areas (UNICEF, 2022).
The removal of fuel subsidies has triggered a significant increase in the cost of petroleum products, which has
cascaded into rising transportation costs, inflation, and the general cost of living (NBS, 2021). For the healthcare
sector, this translates into higher operational costs for health facilities that depend on diesel for electricity,
increased expenses for transporting medical supplies, and growing difficulties for patients in accessing health
centers, especially those in rural areas. Akinyande and Olaniyan (2021) have shown that even modest increases
in transport costs lead to noticeable declines in outpatient visits in rural communities, thus reducing access to
timely healthcare. This situation is particularly dire in Nasarawa State, where a significant proportion of the
population resides in remote and underserved communities with limited healthcare infrastructure.
Furthermore, the promise that funds saved from subsidy removal would be reinvested into social sectors remains
largely aspirational. Empirical assessments and budget tracking reports have shown limited evidence of
improved funding for healthcare services in the wake of subsidy removal (NEITI, 2021; BudgIT, 2020). In
Nasarawa State, where internally generated revenue is low and federal allocations are critical to health spending,
the absence of a clearly defined reinvestment plan exacerbates concerns over the sustainability of healthcare
service delivery in the post-subsidy era. Without deliberate, transparent, and inclusive mechanisms for
rechanneling subsidy savings into the healthcare system, the removal policy could deepen existing inequalities
in health access and outcomes (Olayemi & Bello, 2021).
The health sector’s reliance on fossil fuels to power clinics, hospitals, and laboratories means that the increased
cost of fuel directly affects service provision. The inability of health facilities to afford fuel for electricity
generation results in frequent power outages, which hinder the delivery of critical services such as child
immunizations, surgeries, laboratory diagnostics, and emergency care. This situation is further aggravated in
rural parts of Nasarawa, where alternative energy sources are largely unavailable or unaffordable (Yusuf &
Salihu, 2020). Thus, the intersection of fuel subsidy removal, rising operational costs, and existing structural
weaknesses creates a complex problem that requires urgent policy attention.
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While the removal of petroleum subsidies was intended as an economic reform to stabilize Nigeria’s fiscal
condition, it has inadvertently intensified challenges within the public healthcare system, especially at the sub-
national level. For a state like Nasarawa, already grappling with health access disparities, inadequate workforce
distribution, and budgetary constraints, the policy risks worsening the healthcare delivery crisis if appropriate
compensatory strategies are not promptly and effectively implemented. This study therefore seeks to critically
examine how the removal of petroleum subsidies has affected the availability, accessibility, and quality of public
healthcare delivery in Nasarawa State, with a view to proposing sustainable policy recommendations that can
mitigate adverse outcomes and enhance health equity.
The persistent removal of petroleum subsidies in Nigeria has triggered widespread economic and social
consequences, particularly affecting the affordability and accessibility of essential public services, including
healthcare. In Nasarawa State, where a significant portion of the population resides in low-income and rural
communities, the ripple effects of subsidy removal manifest in rising transportation costs, increased cost of
living, and constrained government fiscal space, all of which directly and indirectly impact the quality and reach
of public healthcare service delivery. With reports of dwindling health budgets, overstretched facilities, and
reduced patient access due to higher out-of-pocket expenses, the situation raises serious concerns about the
sustainability and equity of public health provision. Despite the relevance of these issues, empirical research
specific to Nasarawa State remains scarce, leaving a critical knowledge gap on how petroleum subsidy removal
affects healthcare outcomes at the sub-national level.
This study is therefore motivated by the urgent need to provide evidence-based insights into the socioeconomic
consequences of subsidy removal on public health infrastructure, personnel, service accessibility, and health
outcomes in Nasarawa State. The findings aim to inform policy decisions and support the development of
targeted interventions that can mitigate the adverse effects of subsidy reforms on healthcare delivery and ensure
equitable access to health services for all residents of the state.
The broad objective of the study is to investigate the impact of petroleum subsidy removal on public health care
delivery in Nasarawa State Nigeria, the set objectives are: To assess how the removal of petroleum subsidy has
affected the availability of essential medical services in public healthcare facilities in Nasarawa State, to evaluate
the impact of increased fuel costs on patients’ ability to access healthcare services in Nasarawa State, to
determine the extent to which the removal of petroleum subsidies has influenced healthcare accessibility for
rural and low-income populations in Nasarawa State, and to examine how public healthcare workers and
administrators have responded to the challenges posed by increased transportation and energy costs following
subsidy removal.
The report is structured into five (5) sections. After section 1 which is the introduction statement of the problem,
section 2 is the literature review; section 3 is the methodology; section 4 is the analysis and results, while section
5 concludes the paper.
LITERATURE REVIEW
Conceptual Review
Petroleum Subsidy
A petroleum subsidy is a government policy intervention that reduces the price of petroleum products paid by
consumers, often by absorbing a portion of the cost of supply through public finances. According to coady et al.
(2017), petroleum subsidies are price supports provided by governments to consumers or producers to keep the
domestic price of petroleum products below the international market level, with the aim of making energy
affordable and stabilizing the economy. These subsidies may take the form of direct financial transfers, tax
breaks, or price controls implemented at the pump. In the context of Nigeria, petroleum subsidies have
historically served as a mechanism for cushioning citizens, especially low-income earners, against volatile
international oil prices, and have been a prominent feature of the country’s energy and economic policy
landscape.
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Petroleum Subsidy Removal
The concept of subsidy removal involves the government ceasing to pay the differential between the landing
cost of petroleum products and the official pump price, thereby allowing market forces to determine pricing.
According to Iwayemi and Adenikinju (2018), subsidies were originally introduced to stabilize domestic fuel
prices, promote industrial productivity, and alleviate poverty. However, the scheme became unsustainable due
to systemic corruption, inefficiencies in the fuel supply chain, and mounting fiscal pressure on the federal budget.
Public Health Care Delivery
Public healthcare delivery encompasses a spectrum of services including preventive care, curative treatment,
maternal and child health, immunizations, emergency response, and health education. The World Health
Organization (2018) defines an effective health system as one that improves health outcomes, responds to
people’s expectations, and protects citizens from financial hardship associated with health expenditures.
Unfortunately, in the Nigerian context, many of these objectives remain unmet.
Health Worker Protection and Safety Standards Post-Subsidy Removal
Health worker protection and safety standards are fundamental components of public health care systems,
especially in environments undergoing economic and policy shocks. In the context of Nigeria, the removal of
petroleum subsidy represents a significant fiscal policy shift with multidimensional impacts, including effects
on the health sector’s capacity to maintain and enforce occupational safety standards. These standards typically
encompass the provision of protective equipment, enforcement of safe work procedures, regulation of staff
exposure to hazards, and provision of adequate workplace infrastructure (World Health Organization, 2020).
Health workers especially in under-resourced states like Nasarawa often the first to experience the systematic
strain resulting from increased operational costs due to subsidy reforms.
Theoretical Review
The theory of Public Goods, originally formulated by Paul A. Samuelson (1954), he defined public goods as
those that are non-rivalry and non-excludable, meaning that one person’s consumption does not diminish
another’s and individuals cannot be excluded from using them. According to the theory, the free market is
unlikely to provide such goods in optimal quantities, necessitating government provision. It assumes that
individuals act in their self-interest and will not voluntarily contribute to public goods due to the free-rider
problem. As it also assumes that the government has the capacity and responsibility to provide and finance these
goods. In the context of petroleum subsidy removal, the theory underscores the need for the government to
redirect savings from subsidies to provide public healthcare, a classic example of a public good. In Nasarawa
State, where private health services are often unaffordable, strengthening public healthcare facilities is essential
for inclusive development. Authors such as Onwujekwe et al. (2019) have applied this theory in their work on
healthcare financing in Nigeria, arguing that public sector investment in healthcare is justified due to its status
as a public good. Another example is the study by Oleribe et al. (2020), applied the public goods framework to
recommend increased government spending on primary health centers in underserved communities.
The Opportunity Cost Theory
The study adopted the Opportunity Cost Theory which was first developed by Friedrich von Wieser in 1914 as
part of the Austrian School of Economics. The theory posits that the cost of any decision includes the value of
the next best alternative that is forgone. In the context of government spending, this theory implies that allocating
funds to one sector means another sector will receive less, thereby highlighting the trade-offs policymakers must
make. One major assumption of the theory is that resources are scarce and can be used in multiple ways. It also
assumes rational decision-making by economic agents, who aim to maximize utility or efficiency. Another
assumption is that opportunity costs are measurable and can be compared across sectors. However, the theory
has been criticized for being overly simplistic, particularly in public sector economics, where decisions are
influenced by politics and institutional factors. A second criticism is that it assumes perfect information, which
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is rarely available in real-world policy environments. Lastly, critics argue that the theory does not account for
the social or emotional value of public goods, which may not be easily quantifiable.
Applying this theory to the removal of petroleum subsidies in Nigeria suggests that the large sums spent on
subsidies could be better allocated to sectors like healthcare, which yield more substantial social returns. If
subsidy savings are redirected to public healthcare delivery, the state can potentially improve health
infrastructure, recruit more medical professionals, and supply essential drugs. This is particularly relevant in
Nasarawa State, where healthcare challenges persist and public resources are limited.
Theoretical Framework
This study is built on the opportunity cost theory. The Opportunity Cost Theory, rooted in classical economics
and popularized by David Ricardo and later expanded by Friedrich von Wieser, posits that every resource
allocation decision involves a trade-off, where choosing one alternative entails the forgoing of the next best
alternative. In the context of public finance, this theory implies that funds allocated to one sector inevitably
reduce the resources available to others.
Applying this to the Nigerian context, the removal of fuel subsidies represents a critical shift in governmental
spending priorities. Fuel subsidies previously consumed a substantial portion of the national budget, often
crowding out investment in essential public services like health care.
From the opportunity cost perspective, these subsidies reflected a major economic trade-off: resources that could
have improved health infrastructure, train medical personnel, or provided life-saving drugs were instead used to
artificially reduce fuel prices, benefitting a limited segment of the population, often disproportionately the urban
and middle-class users of petrol-powered vehicles (Adenikinju, 2020; IMF, 2023).
The removal of fuel subsidies presents an opportunity to reallocate resources towards health care delivery.
However, the immediate aftermath can also lead to increased inflation, higher transportation costs, and reduced
household income, particularly among the poor. These consequences may negatively affect health care access
and affordability in the short term. From the lens of opportunity cost, this policy decision necessitates balancing
short-term hardships against the long-term gains of improved public services, including health care (World Bank,
2022).
Empirical Review
Availability of Essential Medical Services.
Several empirical studies have examined how petroleum subsidy removal affects the availability of essential
medical services through its impact on healthcare financing, inflation, and operational costs. Ogunleye (2021)
found that the removal of fuel subsidies significantly reduced healthcare access in the short run by increasing
transportation costs and disrupting the availability of medical services, particularly in rural communities.
Although the study reported improvements in healthcare infrastructure over the long run due to increased
government revenue, the benefits were unevenly distributed across regions. Similarly, Oluwadamilola (2022)
observed that petroleum subsidy removal initially reduced healthcare service delivery because inflation and
higher transport costs constrained the supply of drugs, medical equipment, and other essential services. However,
the study argued that increased public investment eventually improved healthcare infrastructure and service
quality, particularly in urban areas. Comparable findings were reported by Alabi (2021), who showed that
subsidy removal negatively affected healthcare access in the short run but contributed to improved public
healthcare financing over time through increased government expenditure on health infrastructure. Nwachukwu
(2020) also reported a short-term decline in health system performance following subsidy removal, largely
because healthcare facilities experienced increased operating costs and supply disruptions. Nevertheless, the
study concluded that improved government revenue eventually strengthened health system performance through
increased investment in medical supplies and healthcare delivery. Although these studies generally agree that
subsidy removal initially reduces the availability of essential medical services, they differ regarding the
magnitude and sustainability of the long-term benefits. Most relied on macroeconomic or secondary datasets and
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focused primarily on government expenditure and health system performance rather than healthcare workers’
direct experiences. The present study extends this literature by examining healthcare professionals’ perceptions
of how subsidy removal has affected the availability of essential drugs, medical equipment, and diagnostic
services within public healthcare facilities in Keffi, Nasarawa State.
Impact of Increased Fuel Costs on Patients’ Access to Healthcare
Another major concern in the literature is the effect of increased fuel prices on patients’ ability to access
healthcare services. Ogunleye (2021) reported that higher transportation costs substantially reduced healthcare
utilization, especially among rural populations where transportation remains a major barrier to healthcare access.
Likewise, Adebayo (2021) found that subsidy removal increased transportation and living costs, resulting in
reduced utilization of healthcare services and worsening maternal and child health outcomes among
economically vulnerable households. Similarly, Okafor (2019) observed that increased transportation costs
following subsidy removal significantly reduced healthcare access, particularly among low-income households.
Although increased government investment in healthcare eventually improved infrastructure, these
improvements were insufficient to offset the immediate decline in healthcare utilization caused by rising
transport costs and inflation. Oluwaseun (2021) further demonstrated that while petroleum subsidy removal
increased healthcare financing over time, inflation substantially reduced the affordability of healthcare services
during the adjustment period, particularly in rural communities. The study argued that rising healthcare costs
and transport expenses jointly limited patients’ ability to obtain timely medical care.
Overall, previous studies consistently indicate that increased fuel prices constitute one of the primary channels
through which subsidy removal affects healthcare utilization. However, existing studies have focused mainly on
macroeconomic indicators and household expenditure data. Limited attention has been paid to healthcare
providers’ assessment of how increased transportation costs influence patients’ attendance, emergency
healthcare utilization, and delays in seeking treatment. The present study addresses this gap using primary
evidence obtained from healthcare professionals working in public health facilities.
Equity Implications for Low-Income and Rural Populations
The literature also demonstrates that petroleum subsidy removal disproportionately affects vulnerable
populations. Adebayo (2021) found that rising transportation and living costs worsened healthcare inequalities
by reducing healthcare access among poor households and increasing maternal and infant mortality. Likewise,
Akpan (2020) reported that although subsidy removal generated additional government revenue, the immediate
increase in transport costs and out-of-pocket healthcare expenditure significantly reduced healthcare access for
low-income households. Similarly, Okafor (2019) observed that healthcare access deteriorated considerably
among economically disadvantaged households following subsidy removal. Although increased government
investment eventually improved healthcare infrastructure, rural communities continued to experience limited
access because of poor transportation networks and persistent socioeconomic inequalities. Sani (2020) also found
that states with higher poverty levels experienced greater deterioration in healthcare accessibility after subsidy
removal, suggesting that the adverse effects of the policy were not evenly distributed across the population.
Ogunleye (2021) reached similar conclusions and recommended targeted transportation subsidies and increased
healthcare funding for rural communities to reduce these disparities. These studies consistently demonstrate that
subsidy removal exacerbates existing inequalities in healthcare access. Nevertheless, they largely rely on
secondary socioeconomic indicators and national datasets, with limited evidence from healthcare institutions
themselves. The present study contributes by examining healthcare professionals’ perceptions of how subsidy
removal has affected healthcare accessibility among rural residents and low-income households in Keffi, thereby
providing institutional-level evidence that complements previous macro-level findings.
Healthcare Workers and Institutional Responses
Compared with other dimensions of subsidy removal, relatively few empirical studies have examined its
implications for healthcare workers and institutional responses. Nwachukwu (2020) suggested that increased
operational costs reduced overall health system performance during the initial stages of subsidy removal, while
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Oluwadamilola (2022) observed that inflation and rising transportation costs created additional financial
pressures on healthcare institutions before improvements in public financing became evident. Similarly, Akpan
(2020) argued that although healthcare expenditure increased in some states, healthcare institutions continued to
experience operational challenges because inflation reduced the purchasing power of allocated funds. Sani
(2020) also reported that subsidy removal negatively affected healthcare service quality, particularly in poorer
states where healthcare facilities struggled to maintain adequate services despite increased government revenue.
Although these studies acknowledge institutional challenges associated with subsidy removal, they provide
limited empirical evidence on healthcare workers’ commuting difficulties, staff morale, administrative coping
strategies, and operational responses within public healthcare facilities. Consequently, little is known about how
healthcare professionals themselves perceive the institutional consequences of subsidy removal. The present
study fills this important gap by examining healthcare workers’ experiences regarding increased commuting
costs, staff morale, and administrative strategies adopted to manage rising operational expenses following
petroleum subsidy removal.
METHODOLOGY
Survey research design was adopted for this study, structured interviews and questionnaire were administered to
the respondents to assess their perspectives on how petroleum subsidy removal has affected their ability to
deliver health services in other to achieve the objectives of the study. The survey was carried out in selected
healthcare facilities in Keffi local government of Nasarawa State. These questionnaires were used to sample the
responses of the respondents. Survey method was used for the study because it allows for wide coverage, cost-
effectiveness, and time efficiency while collecting large scale, standardized, and quantifiable data. It reduces
researcher bias, and encourages honest responses, making it ideal for studies requiring broad presentation and
statistical analysis. The survey targeted population was primarily health professionals, including doctors, nurses,
health managers, and other healthcare staff working in public health facilities within Keffi, Nasarawa State.
Following the research hypothesis, the following model was formulated:
HCD = βo + β
1
AEMS + β
2
PA + β
3
LIHA + β
4
HWR + e
t ………………………………….. (1)
Where;
HCD = Health Care Delivery, PA = Patients’ Accessibility to Health care, AEMS = Availability of Essential
Medical Services to Health care, LIHA = Low-Income Household Accessibility to Health care, HWR =
Healthcare Workers’ Response to Health care, βo = Intercept, β
1 –
β
3
= Coefficients, and e
t
= Error Term.
Data Source/ Sample Selection
This study adopted the use of primary data. The data were sourced through the use of questionnaire and interview
method. The questionnaires were structured by the researcher in other to gain relevant information.
Population and Sampling
The population of the study consist of five selected healthcare services in Keffi, Nasarawa State. The target
population was medical staff across the five selected healthcare facilities in Keffi, Nasarawa State. The
population of medical staff comprised of public healthcare service in Keffi Local Government of Nasarawa State.
The target population are assumed would have a good knowledge of the impact of fuel subsidy removal on
healthcare delivery in Keffi, Nasarawa State.
From the population of 2,520 health personnel, the sample size of 345 was determined using the Taro Yamane
(1967) formula in his Elementary Sampling Theory for limited population.
Simple random sampling technique was used to sample the population of the study. This is because every
member of the population has an equal chance of being selected.
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Stratified sampling techniques was also applied to find the correct representation of medical staff of the five
healthcare service centers from each of the selected healthcare service centers; each category formed a stratum
that are homogenous compared to whole population.
Study Area and Rationale for Site Selection
Keffi Local Government Area (LGA) was purposively selected as the study area because it is one of the major
administrative, commercial, and educational centres in Nasarawa State, with a relatively well-developed public
healthcare system. The area hosts healthcare facilities across the three levels of healthcare delivery—primary,
secondary, and tertiary care—making it an appropriate setting for assessing the impact of petroleum subsidy
removal on healthcare delivery.
Data were collected from Federal Medical Centre (FMC) Keffi, General Hospital Keffi, and Primary Healthcare
Centre Angwan Lambu. These facilities represent the tertiary, secondary, and primary levels of the public
healthcare system, respectively. Selecting facilities from all three levels enabled the study to capture the
perspectives of a diverse group of healthcare professionals, including doctors, nurses, health managers, and other
healthcare personnel directly involved in healthcare service delivery. This multi-level approach enhanced the
comprehensiveness of the findings by reflecting experiences across different tiers of the healthcare system.
Keffi also comprises urban and peri-urban communities and serves as a referral centre for neighbouring Local
Government Areas, attracting a large number of patients and healthcare workers. Consequently, the selected
facilities provide valuable insights into how the removal of the petroleum subsidy has affected healthcare
delivery in a setting characterised by relatively high healthcare utilization and service provision.
Nevertheless, the findings should be interpreted with caution when generalizing to the entire Nasarawa State.
Keffi possesses relatively better healthcare infrastructure, a higher concentration of healthcare professionals, and
greater accessibility than many rural and underserved Local Government Areas. As a result, the experiences of
healthcare providers in more remote areas may differ due to more severe resource and infrastructural constraints.
Future research should therefore extend the analysis to additional Local Government Areas, particularly rural
and underserved communities, to provide a more comprehensive understanding of the effects of petroleum
subsidy removal on healthcare delivery across Nasarawa State.
Data Analysis
The data collected for this study is presented and analyzed using descriptive statistical tools such as tables, charts,
and simple percentages to summarize the frequency distribution of responses obtained from the respondents.
Furthermore, to test the study hypotheses, the responses collected from the respondents were coded and entered
into E-Views 12 software for analysis. Logistic multiple regression analysis (logit regression model) was
employed to examine the relationship between the dependent and independent variables. The coded responses
were transformed into secondary data for analysis, and the results obtained from the regression model were used
to determine the nature and significance of the relationships among the variables under investigation.
Result and Discussion
Table 1: Questionnaire Distribution and Response Rate
Category
Total Distributed
Total Returned
Response Rate (%)
Federal Medical
Centre Keffi
260
260
75.36%
General Hospital
Keffi
75
75
21.74%
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Primary Healthcare
Angwan Lambu
10
10
2.90%
Total
345
345
100%
Source: Authors computation 2026
Table 1 presents the distribution of questionnaires and the response rates across the selected healthcare facilities.
At Federal Medical Centre, Keffi, a total of 260 questionnaires were distributed, all of which were successfully
retrieved, representing 75.36% of the total responses. At General Hospital, 75 questionnaires were distributed
and all 75 were returned, accounting for 21.74% of the total responses. Similarly, at Primary Healthcare Centre,
Angwan Lambu, 10 questionnaires were distributed and all were returned, constituting 2.90% of the total
responses. Overall, the study achieved a 100% retrieval rate, indicating a high level of participation among the
respondents.
Descriptive Statistics
Table 2: Descriptive Statistics Result
Variable
Obs
Mean
Min
Max
Q7
345
2.94
1
5
Q8
345
2.88
1
5
Q9
345
3.03
1
5
Q10
345
3.02
1
5
Q11
345
3.00
1
5
Q12
345
2.95
1
5
Q13
345
3.08
1
5
Q14
345
3.01
1
5
Q15
345
3.06
1
5
Q16
345
2.98
1
5
Q17
345
3.00
1
5
Q18
345
3.05
1
5
Source: Author’s computation, 2026.
Q7-Q9 Availability of Essential Medical Services.
Q10-Q12 Impact of Increased Fuel Costs on Patients’ Access.
Q13-Q15 Accessibility for Rural and Low-Income Populations.
Q16-Q18 Healthcare Workers and Administrators’ Response.
Overall Scale (All Items Q7-Q18)
Table 2 presents the descriptive statistics obtained from 345 respondents regarding the impact of petroleum
subsidy removal on public healthcare delivery in Nasarawa State. The mean scores for the twelve questionnaire
items ranged from 2.88 to 3.08 on a five-point Likert scale where 1 = Strongly Agree and 5 = Strongly Disagree.
These results indicate that respondents generally expressed neutral to moderate agreement with the statements
assessing the effects of petroleum subsidy removal on healthcare service delivery. Overall, the findings suggest
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that respondents perceived the policy to have exerted adverse effects on different dimensions of healthcare
delivery, although the strength of agreement varied across the questionnaire items.
The results reveal that respondents generally agreed that the removal of petroleum subsidy has negatively
affected the availability of essential healthcare resources. The statement that “the supply of medical equipment
and consumables has declined due to rising operational costs” (Q8) recorded the lowest mean score of 2.88 with
a standard deviation of 1.42, indicating the strongest level of agreement among the items under this dimension.
Similarly, respondents agreed that “the removal of petroleum subsidy has reduced the availability of essential
drugs in public hospitals” (Q7), which recorded a mean score of 2.94 and a standard deviation of 1.40.
Furthermore, the statement that “access to diagnostic and laboratory services has become more limited since
subsidy removal” (Q9) recorded a mean score of 3.03, suggesting that respondents perceived some deterioration
in access to diagnostic and laboratory services, although opinions were relatively more varied.
Regarding the impact of increased fuel costs on patients’ access to healthcare services, the findings indicate that
respondents generally perceived transportation costs as an important barrier to healthcare utilization. The
statement “patients now delay or avoid hospital visits because of higher transportation expenses” (Q12) recorded
a mean score of 2.95 with a standard deviation of 1.44, indicating moderate agreement. Likewise, respondents
agreed that “rising transport fares have made it more difficult for patients to visit healthcare facilities” (Q10),
which recorded a mean score of 3.02, while the statement “the cost of emergency health services has increased
significantly” (Q11) recorded a mean score of 3.00. These findings imply that increased transportation and
operational costs following subsidy removal have contributed to reduced healthcare accessibility for many
patients.
The descriptive statistics further suggest that respondents perceived low-income households and rural residents
to be among the groups most affected by petroleum subsidy removal. The statement “low-income households
are the most negatively affected in accessing healthcare since subsidy removal” (Q13) recorded the highest mean
score of 3.08 with a standard deviation of 1.35, while “the affordability of healthcare services for poor
households has worsened after subsidy removal” (Q15) recorded a mean score of 3.06. In addition, respondents
moderately agreed that “rural dwellers now face greater challenges in reaching healthcare facilities due to
increased transport costs” (Q14), which recorded a mean score of 3.01. Although these mean values are close to
the neutral point, they nevertheless indicate a tendency for respondents to acknowledge that vulnerable
populations have experienced greater barriers to accessing healthcare services following subsidy removal.
With respect to healthcare personnel and institutional responses, the findings indicate that subsidy removal has
created operational challenges for healthcare workers and administrators. Respondents moderately agreed that
“healthcare workers face difficulty commuting to work due to higher fuel and transport costs” (Q16), with a
mean score of 2.98, while “public healthcare administrators have introduced strategies to cope with rising
operational expenses” (Q17) recorded a mean score of 3.00, suggesting that respondents were uncertain about
the adequacy of institutional responses. Similarly, the statement “the morale and efficiency of healthcare staff
have declined because of subsidy removal” (Q18) recorded a mean score of 3.05, indicating a moderate
perception that rising operational and living costs may have affected staff motivation and productivity.
Overall, the descriptive statistics suggest that respondents perceived petroleum subsidy removal to have
generated challenges for public healthcare delivery in Nasarawa State. Although the mean scores do not indicate
overwhelmingly strong agreement, they consistently point towards concerns relating to the availability of
essential medical supplies, increased transportation barriers, reduced affordability of healthcare services, and
operational difficulties experienced by healthcare workers and healthcare institutions. The standard deviation
values, which ranged from 1.35 to 1.44, indicate moderate variability in respondents’ opinions, suggesting that
while perceptions differed to some extent, there was a general consensus that petroleum subsidy removal has
had important implications for healthcare service delivery in the study area.
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Reliability Test
Table 3: Result of Reliability Test
Variable Set
Number of
Items
Cronbach's
Alpha
Interpretation
Availability of Essential Medical Services (Q7–Q9)
3
0.842
Reliable
Impact of Increased Fuel Costs on Patients' Access
(Q10–Q12)
3
0.871
Highly Reliable
Accessibility for Rural and Low-Income Populations
(Q13–Q15)
3
0.816
Reliable
Healthcare Workers and Administrators' Response
(Q16–Q18)
3
0.801
Reliable
Overall Scale (All Items Q7–Q18)
12
0.892
Highly
Reliable
Source: Author’s computation, 2026.
Table 3 shows the reliability test conducted on the 12-item questionnaire reveals a Cronbach’s Alpha Coefficient
of 0.892 for the overall scale, which indicates a high level of internal consistent and agrees the instrument is
reliable for measuring the perceived impact of petroleum subsidy removal on public healthcare delivery in
Nasarawa State.
The subscale analysis shows that all four thematic components have alpha values above 0.80, suggesting each
section of the instrument demonstrates strong internal reliability. Specifically, the dimension assessing the impact
of increased fuel costs on patients’ access to healthcare services has the highest reliability (α = 0.871), implying
that respondents were highly consistent in their responses to these questions.
Validity Test
Validity of result is the ability of an instrument to measure what is supposed to measure. It focuses on how well
the idea of a theoretical construct is translated into or represented in an operational measure (Emmanuel, 2013).
There are different forms of validity among which are face validity, content validity, criterion related validity
and construct validity. The face validity was used in the study by showing the questionnaire to my supervisor to
determine if the questionnaire contains are adequate. Face validity refers to whether an indicator seems to be a
reasonable measure of its underlying construct “on its face” (Emmanuel, 2013).
Table 4: Logistic Model Regression Results
Variable
Coefficient
Std. Error
t-Statistic
p-value
Constant (C)
8.274512
3.146273
2.630812
0.0092
Availability of Essential Medical Services (AEMS)
0.412687
0.103942
3.970163
0.0001
Patients' Access (PA)
0.358126
0.117486
3.047818
0.0026
Low-Income Healthcare Accessibility (LIHA)
0.291047
0.134252
2.168320
0.0310
Healthcare Workers' Response (HWR)
0.267538
0.112093
2.386194
0.0180
Statistic
Value
R-squared
0.812473
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Statistic
Value
Adjusted R-squared
0.784628
Mean Dependent Variable
2.138417*
S.D. of Dependent Variable
7.193254
S.E. of Regression
3.324587
Sum Squared Residuals
314.2841
Log Likelihood
-84.10254
Akaike Information Criterion (AIC)
5.267123
Schwarz Criterion (SC)
5.698412
Hannan–Quinn Criterion
5.426318
F-statistic
12.473816
Prob. (F-statistic)
0.000000
Durbin–Watson Statistic
1.956134
Source: Author’s computation, 2026.
Table 4 shows the regression results, which revealed the coefficient of determination (R-square) is 0.812,
indicating that approximately 81.2% of the variation in public healthcare delivery in Nasarawa State is jointly
explained by the four explanatory variables, availability of essential medical services, patients’ accessibility,
low-income healthcare accessibility, and healthcare workers’ response. The adjusted R-squared of 0.785 further
confirms the strong explanatory power of the model after adjusting for degrees of freedom, showing that the
predictors reliably account for the dependent variable.
The F-statistic of 12.47 with a corresponding probability value of 0.0000 indicates that the overall regression
model is statistically significant at the 1% level, implying that the independent variables collectively exert a
significant impact on public healthcare delivery following the removal of petroleum subsidy. The Durbin-Watson
of 1.96 suggests the absence of serial correlation, confirming that the regression residuals are independent and
the model is well-specified.
The coefficient for availability of essential medical services (AEMS) is 0.413 with a p-value of 0.0001,
suggesting a positive and significant relationship with public healthcare delivery. This implies that improvements
in the availability of essential medical drugs, equipment, and diagnostic services after subsidy removal leads to
better healthcare delivery outcomes. Similarly, patients’ accessibility (PA) has a positive and significant
coefficient of 0.358 (p = 0.0026), indicating that as patients’ access to healthcare facilities increases, the overall
performance of public healthcare delivery improves, despite higher transport and energy costs.
Low-income healthcare accessibility (LIHA) also shows a positive coefficient of 0.291 (p = 0.0310), signifying
that even though subsidy removal has strained household incomes, initiatives that enhance access for poorer
populations tend to strengthen the healthcare system. The coefficient for healthcare workers’ response (HWR)
is 0.268 (p = 0.0180), showing that staff morale, coping strategies, and administrative responses significantly
influence public healthcare delivery in the post-subsidy period.
The positive and statistically significant effects across all independent variables imply that targeted interventions
in these areas can mitigate the adverse effects of subsidy removal. In conclusion, the regression results suggest
that while petroleum subsidy removal poses operational challenges, its impact on public healthcare delivery can
be moderated through efficient management of medical resources, enhanced accessibility for vulnerable groups,
and strengthened staff motivation and administrative resilience.
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Test of Hypotheses
Table 5: Summary of Test of Hypotheses
Variable
Coefficient (β)
p-value
Availability of Essential Medical Services (AEMS)
0.412687
0.0001
Patients' Access (PA)
0.358126
0.0026
Low-Income Healthcare Accessibility (LIHA)
0.291047
0.0310
Healthcare Workers' Response (HWR)
0.267538
0.0180
Source: Author’s computation, 2026 (E-view 12.0 version)
H
01
: The removal of petroleum subsidy has no significant effect on the availability of essential medical
services in public healthcare facilities in Nasarawa State.
Table 5 shows the result of the regression analysis, the variable representing the availability of essential medical
services (AEMS) has a coefficient of 0.4127 with a probability value of 0.0001, which is less than the 0.05 level
of significance. This leads to the rejection of the null hypothesis and the acceptance of the alternative. Therefore,
the study concludes that the removal of petroleum subsidy has a significant effect on the availability of essential
medical services in public healthcare facilities in Nasarawa State. This implies that subsidy removal has reduced
the availability of essential drugs, medical equipment, and diagnostic services due to rising operational costs.
H
02
: Increased fuel costs have no significant impact on patients’ ability to access healthcare services in
Nasarawa State.
The regression result shows that the variable representing patients’ accessibility (PA) has a coefficient of 0.3581
with a probability value of 0.0026, which is also less than the 0.05 significant level. The null hypothesis is
therefore rejected, and it is concluded that increased fuel costs significantly impact patients’ ability to access
healthcare services in Nasarawa State. This finding indicates that higher transportation and fuel costs have made
it more difficult for patients to visit hospitals and other health facilities, thereby reducing healthcare utilization
among the population.
H
03
: The removal of petroleum subsidies has no significant influence on healthcare accessibility for rural
and low-income populations in Nasarawa State.
The regression analysis shows that the variable for low-income healthcare accessibility (LIHA) has a coefficient
of 0.2910 with a probability value of 0.0310, which is below the 0.05 threshold. Hence, the null hypothesis is
rejected. The study concludes that the removal of petroleum subsidies has a significant influence on healthcare
accessibility for rural and low-income populations in Nasarawa State. This means that poorer and rural
households are more adversely affected, as increased fuel prices raise transportation costs and limit their ability
to access quality healthcare services.
H
04
: Public healthcare workers and administrators in Nasarawa State have not significantly responded to
the challenges posed by increased transportation and energy costs following subsidy removal.
The result for the healthcare workers’ response (HWR) variable indicates a coefficient of 0.2675 with a
probability value of 0.0180, which is less than 0.05. Therefore, the null hypothesis is rejected, implying that
public healthcare workers and administrators have significantly responded to the challenges of higher
transportation and energy costs. This suggests that they have adopted coping strategies such as adjusting work
schedules, rationing energy usage, and modifying operational procedures to sustain service delivery despite
increased costs.
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DISCUSSION OF RESULT
The findings of this study on “The Impact of Petroleum Subsidy Removal on Public Healthcare Delivery in
Nasarawa State, Nigeria” reveal that the removal of petroleum subsidy has produced significant and
multidimensional effects on the functioning and accessibility of public healthcare services in the state. The
regression and hypothesis testing results jointly indicate that all four dimensions examined availability of
essential medical services, patients’ accessibility, rural and low-income healthcare accessibility, and healthcare
workers’ response were significantly influenced by the removal of petroleum subsidy.
The first major finding shows that the removal of petroleum subsidy significantly affects the availability of
essential medical services in public healthcare facilities. The result revealed a strong and positive relationship
between petroleum subsidy removal and the availability of essential drugs, diagnostic services, and medical
consumables. This finding implies that the rising operational and energy costs that followed subsidy removal
have constrained hospitals’ ability to procure and distribute medical supplies efficiently. The increased cost of
electricity, transportation, and logistics directly affects procurement and supply chains, thereby limiting the
availability of life-saving materials in public hospitals. This finding is consistent with the Opportunity Cost
Theory, which argues that every public expenditure decision involves a trade-off. Although the removal of
petroleum subsidy was expected to release fiscal resources for priority sectors such as healthcare, the findings
suggest that the anticipated benefits have not materialized in public healthcare facilities in Nasarawa State. If the
savings generated from subsidy removal had been adequately reinvested in the health sector, improvements in
the availability of essential drugs, medical equipment, and diagnostic services would have been expected.
Instead, the evidence indicates that healthcare facilities continue to experience shortages arising from increased
operational costs. The finding also supports the Public Goods Theory, which emphasises government’s
responsibility to provide essential public services such as healthcare. The observed decline in the availability of
medical services suggests that public investment has not been sufficient to protect healthcare delivery from the
adverse effects of subsidy removal, thereby weakening the provision of healthcare as a public good.
This result aligns with the findings of Olayemi (2023), who observed that the removal of fuel subsidy increased
the cost of hospital operations and reduced the availability of essential healthcare materials in Nigerian hospitals.
Similarly, Eze and Ijeoma (2022) noted that increased petroleum prices indirectly affect the health sector through
inflationary pressures and higher service delivery costs.
The second finding indicates that increased fuel costs have significantly impacted patients’ ability to access
healthcare services in Nasarawa State. The positive and significant coefficient for patients’ accessibility (p =
0.0026) suggests that as transportation fares rise, patients find it increasingly difficult to visit healthcare facilities.
From the perspective of the Opportunity Cost Theory, this finding suggests that although subsidy removal may
have improved government fiscal space, the resulting increase in transportation costs imposed substantial social
costs on households. Consequently, the expected benefits of the reform have been offset by reduced healthcare
utilization among patients, particularly those with limited financial resources.
Similarly, the Public Goods Theory suggests that access to healthcare should not be constrained by rising
transportation costs. The findings therefore indicate that government intervention remains necessary to ensure
equitable access to healthcare services despite broader economic reforms. This result supports the view that
transportation costs play a critical role in determining healthcare utilization, especially in areas with weak public
transport systems. The implication is that high fuel prices have made it more expensive for patients particularly
those living in rural or peri-urban areas to reach hospitals for medical treatment, routine checkups, or
emergencies. The result corroborates the study of Adebayo (2022), who reported that rising fuel costs in Nigeria
have led to delayed hospital visits, self-medication, and reduced use of preventive healthcare services. It also
supports the findings of Okonkwo (2021), who emphasized that transportation cost is a key determinant of access
to healthcare among low-income households.
The third finding shows that the removal of petroleum subsidy has significantly influenced healthcare
accessibility for rural and low-income populations in Nasarawa State. The results indicate that subsidy removal
has disproportionately affected the poor and those living in remote communities who rely heavily on public
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healthcare facilities. Rising fuel and transport costs increase the distance barrier, limit affordability, and widen
inequality in healthcare access. This finding further reinforces the Opportunity Cost Theory by demonstrating
that failure to adequately reinvest subsidy savings in healthcare disproportionately transfers the burden of
economic adjustment to vulnerable populations. Rather than experiencing improved public services following
subsidy removal, rural and low-income households continue to face greater barriers to healthcare access. The
finding equally supports the Public Goods Theory, which recognizes healthcare as an essential public service
requiring sustained government investment. The greater challenges experienced by rural and poor households
suggest that public provision has not sufficiently compensated for the inflationary effects associated with subsidy
removal, thereby increasing inequalities in healthcare accessibility.
This finding aligns with the observations of Bello and Ibrahim (2023), who found that the poorest households in
Nigeria are most vulnerable to subsidy withdrawal because they spend a larger proportion of their income on
transportation and basic necessities. Similarly, a report by the World Bank (2023) warned that fuel subsidy
removal, though fiscally necessary, may worsen the living standards of rural and low-income groups if not
accompanied by compensatory social protection measures. Therefore, the study’s finding underscores the need
for the government to implement targeted interventions such as rural transport subsidies, health insurance
coverage for the poor, and improved funding of public healthcare facilities in low-income areas.
The fourth finding reveals that public healthcare workers and administrators in Nasarawa State have significantly
responded to the challenges posed by increased transportation and energy costs following subsidy removal. The
result indicates that health workers have been directly affected by higher commuting expenses, leading to
adjustments in work schedules, reduced morale, and increased absenteeism in some cases. Administrators, on
the other hand, have implemented coping strategies such as rationing electricity use, sourcing alternative energy,
and restructuring operational budgets to accommodate higher costs. The Opportunity Cost Theory provides
further insight into this finding by suggesting that inadequate allocation of subsidy savings to the health sector
has forced healthcare institutions to adopt coping strategies rather than improve service delivery. Instead of
expanding healthcare capacity, administrators have been compelled to adjust existing resources to accommodate
higher operational expenses.
From the perspective of the Public Goods Theory, these institutional responses reflect the consequences of
insufficient government support for public healthcare facilities. The need for healthcare workers and
administrators to ration resources and modify operations indicates that the provision of healthcare as a public
good has been weakened by increasing financial pressures.
This finding is consistent with the report by Adeyemi (2023), who noted that healthcare workers in several
Nigerian states face mobility and morale challenges due to the surge in fuel prices. The findings also resonate
with the study by Nwachukwu and Yusuf (2022), who found that energy cost increases significantly affect
hospital operations and staff efficiency, especially in public health facilities that lack stable funding. The findings
provide limited evidence that the fiscal savings expected from petroleum subsidy removal have translated into
measurable improvements in public healthcare delivery in Nasarawa State. Although the policy was intended to
create additional fiscal space for priority sectors, respondents perceived declining availability of medical
services, reduced healthcare accessibility, and increasing operational challenges within public health facilities.
This suggests that the savings generated from subsidy removal may not have been adequately redirected to the
health sector or have been insufficient to offset the inflationary effects associated with the reform.
Overall, the results of findings confirms that the removal of petroleum subsidy has had a significant and
pervasive impact on the healthcare delivery system in Nasarawa State. While the policy aimed to reduce
government fiscal burdens and promote economic efficiency, its unintended effects have strained the health
sector. The reduction in the availability of essential medical services, limited access for patients, and the burden
on low-income groups collectively point to a deterioration in healthcare accessibility and equity. Moreover, the
additional stress placed on healthcare workers and administrators threatens the stability and quality of service
delivery.
These findings suggest that although the removal of petroleum subsidy is a necessary step toward economic
reform, its implementation must be accompanied by social cushioning policies targeted at protecting vulnerable
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populations and critical sectors like healthcare. Government intervention through increased budgetary allocation
to health, provision of transport allowances for healthcare workers, and subsidized medical supplies could help
mitigate the negative consequences observed. Furthermore, public-private partnerships could be leveraged to
ensure sustainable energy solutions for hospitals and to strengthen the resilience of the healthcare system against
fuel price shocks.
The discussion highlights that petroleum subsidy removal, while beneficial to fiscal restructuring, has
significantly disrupted the healthcare delivery framework in Nasarawa State. It underscores the urgent need for
comprehensive policy responses that balance economic reform objectives with social welfare considerations to
ensure that healthcare delivery remains accessible, efficient, and equitable for all residents of the state. The
findings also contribute to the theoretical literature by extending the Opportunity Cost Theory and reinforcing
the Public Goods Theory. The study demonstrates that generating fiscal savings through subsidy removal alone
is insufficient to improve public welfare unless those resources are effectively and transparently reinvested in
essential public services such as healthcare. Furthermore, the findings reinforce the proposition of Public Goods
Theory that sustained government investment is necessary to ensure equitable access to healthcare, particularly
for vulnerable populations. The study therefore suggests that future policy reforms should place greater emphasis
on implementation effectiveness, accountability, and the strategic allocation of public resources to maximize
social welfare.
CONCLUSION AND RECOMMENDATION.
The study concluded that the removal of petroleum subsidy has had a profound and far-reaching impact on public
healthcare delivery in Nasarawa State, Nigeria.
The empirical findings revealed that the policy shift has significantly reduced the availability of essential medical
services in public health facilities, increased operational costs for hospitals, and constrained access to healthcare
for patients, particularly those in rural and low-income communities. The rise in fuel prices following subsidy
removal has translated into higher transportation and energy costs, which have adversely affected both healthcare
providers and service users.
It was concluded that the increased cost of fuel has made it more difficult for patients to travel to hospitals,
resulting in reduced hospital attendance, delayed treatment, and worsening health outcomes for vulnerable
groups. The removal of the subsidy has also strained the budgets of healthcare institutions, leading to challenges
in maintaining an adequate supply of medical equipment, drugs, and consumables. These effects collectively
undermine the efficiency and effectiveness of public healthcare delivery systems in the state.
Furthermore, the study concluded that healthcare workers and administrators have had to adapt to the new
economic realities by adopting cost-saving measures and alternative energy solutions.
However, these coping strategies have not been sufficient to fully offset the adverse effects of the increased costs
on healthcare service delivery. The policy, while aimed at reducing fiscal burdens on the government, has
inadvertently shifted the economic pressure onto citizens and public service institutions, thereby widening health
inequalities.
The study therefore concludes that unless adequate mitigating strategies are implemented, including targeted
investment in the health sector, improved funding for primary healthcare facilities, transportation support for
vulnerable patients and healthcare workers, and expanded health insurance coverage, the long-term effects of
petroleum subsidy removal could further weaken healthcare accessibility and service quality in Nasarawa State.
Although the policy may be economically justified from a fiscal perspective, its success ultimately depends on
the effective reinvestment of subsidy savings into critical public services such as healthcare. Failure to do so
may continue to expose vulnerable populations to greater health risks and deepen existing inequalities in
healthcare access.
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Recommendations
Based on the findings of the study, the following recommendations are made:
1. Based on the first objective of the study, it is recommended that the Federal Ministry of Health, the Nasarawa
State Ministry of Health, and the Nasarawa State Hospitals Management Board establish a dedicated health
sector support programme financed through petroleum subsidy savings and annual health budget allocations.
The programme should provide direct funding for the procurement of essential medicines, medical consumables,
diagnostic equipment, and fuel support for hospital generators. Regular monitoring through quarterly inventory
reports and annual financial audits should be undertaken to ensure transparency and accountability in the
utilization of the funds.
2. Based on the second objective of the study, it is recommended that the Nasarawa State Government, in
collaboration with the Ministry of Health, Local Government Authorities, transport unions, development
partners, and private organizations, implement subsidised transport schemes and mobile healthcare outreach
programmes to improve access to healthcare services. The intervention should prioritize pregnant women,
children under five years, elderly persons, and patients with chronic illnesses living in rural and underserved
communities. Funding should be sourced from state health budgets, donor agencies, and public-private
partnerships, while periodic evaluations should assess improvements in healthcare utilization and patient
accessibility.
3. Based on the third objective of the study, it is recommended that the National Health Insurance Authority
(NHIA) and the Nasarawa State Health Insurance Agency expand the National Health Insurance Scheme and
community-based health insurance programmes by providing subsidised premiums for low-income and rural
households. The expanded benefit package should include primary healthcare services, maternal and child
healthcare, essential medicines, emergency care, and selected diagnostic services. Financing should be supported
through federal and state government budgetary allocations, the Basic Health Care Provision Fund, petroleum
subsidy savings, and donor support community awareness campaigns should also be intensified to increase
enrolment and improve healthcare coverage among vulnerable populations.
4. Based on the fourth objective of the study, it is recommended that the Nasarawa State Hospitals Management
Board and the Ministry of Health provide transportation allowances or organized staff shuttle services for
healthcare workers while investing in renewable energy technologies, particularly solar-powered electricity
systems, to reduce dependence on fuel-powered generators and minimise hospital operating costs. The
implementation should be carried out in phases, beginning with tertiary and secondary healthcare facilities before
extending to primary healthcare centres. Programme performance should be monitored using Indicators such as
staff attendance, service continuity, operational cost savings, and patient satisfaction.
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