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Hydrocephalus is a buildup of fluid inside the skull that leads to brain swelling. It occurs due to problem in the flow of cerebrospinal fluid within the brain. The cause can either be a block in the flow of CSF, increased production of CSF or a decreased absorption, which causes back pressure and hence increase in the size of the brain and the skull.
The cause of the condition is actually determined by tests including a MRI, and treatment depends on the cause.
The shunt in the brain, has been placed, to avoid further increase in the pressure and worsening of her symptoms. Hence as long as she does not have neurological signs and symptoms, it is sbsolutely fine. Providing proper care and emotional support to the child is utmost important, and comparing to normal children will cause more depression of the caregivers and may result in reduced quality of care.
The child will need regular check-ups to make sure there are no further problems. Tests should regularly be done to check the child's developmental and for intellectual, neurological, or physical problems.
You may consult with your pediatric neurologist, who can tell you more about her care and help you cope up with the situation.
I hope this helps.