Cost of provision of essential health Services in Public Health Centers of Jimma zone, Southwest Ethiopia; a provider perspective, the pointer for major area of public expenditure

BACKGROUND: Provision of up-to-date cost information is crucial for not only addressing knowledge gap on the cost of essential health services (EHS) but also budgeting, allocating adequate resources and improving institutional efficiency at public health centers where basic health services are delivered the most. OBJECTIVE: To analyze the costs of essential health services at public health centers in Jimma Zone. METHODS: A facility based cross-sectional study was conducted in public health centers of Jimma zone from April 10, 2018 to May 9, 2018. The study was conducted from a provider perspective using retrospective standard costing approach of one fiscal year time horizon. Step-down allocation was used to allocate costs to final services. All costs for provision EHS were taken into account and expressed in United States dollar (USD). Sixteen public health centers located in eight districts were randomly selected for the study. RESULTS: The Average annual cost of providing essential health services at health centers in Jimma zone was USD 109,806.03 ± 50,564.9. Most (83.7%) of the total Annual cost was spent on recurrent items. Nearly half (45%) of total annual cost was incurred by personnel followed by drugs and consumables that accounted around one third (29%) of the total Annual cost. Around two third (65.9%) of the total annual cost was incurred for provision of EHS at the final cost center. The average overall unit cost was USD 7.4 per EHS per year. CONCLUSION: Cost providing an EHS at public health centers was low and so, necessitating funding of significant resources to provide standard health care. The variability in unit costs and cost components for EHS also suggest that the potential exists to be more efficient via better use of both human and material resources. SUPPLEMENTARY INFORMATION: The online version contains supplementary material available at 10.1186/s13561-021-00334-y.