An Overview Joseph F. Naimoli, Senior Health Specialist The World Bank Contributions from Amie Batson, Ruth Levine, Magnus Lindelow, and Rena Eichler Presented at the Centers for Disease Control and Prevention (CDC), 6/23/09

Results-based financing (RBF) ≈ Pay-for-performance (P4P) Provision of payment for the attainment of well- defined results Transfer of money or material goods conditional on taking a measureable action or achieving a predetermined performance target (CGD, 2009) Donor Central government Local government Private insurer $ Recipients of care Health care providers Facilities / NGOs Central government Local governments RBF takes many forms… PayersPayees Different definitions; common theme

Supply-side incentives Demand-side incentives Often multiple beneficiaries in a cascading scheme Madagascar Increased utilization of MCH services 3 ANC visits Institutional delivery Complete immunization of children under 1 Post-partum care within 1 week of birth Improved Maternal and Child Health Cash payment to women Increased $ resources for health service providers Increased $ resources for regional & district health authorities Schemes vary by country

 People are motivated by intrinsic forces (professional pride)  People are motivated by extrinsic forces (money and recognition)  If designed well, RBF can reinforce professional pride with money and recognition, without undermining intrinsic motivation Underlying principles

Development Assistance Perspective Country Perspective (low- and middle- income) RBF Two perspectives

Business as usual unlikely to achieve Millennium Development Goals (MDGs) MDG4 progress in 68 priority countries Source: UNICEF, 2008

RBFTraditional Norms: “Here are the inputs, use them this way” Training, medicines, supplies Command and control Stimulate and reward innovation Incentive environments of decision makers Frustration with traditional input-based approaches CGD, 2009 Inputs necessary but not sufficient!

Health services Health information Health workforce Technologies Leadership Financing RBF Governance Commodities Tool for strengthening health system s Health system building blocks, WHO, 2007

Increasing recognition as promising strategy for MDGs Recommendations: Clearly link financing for health to defined outcomes and to measurable results in broader programmes as well as in projects, building on the specific experiences from performance-based funding and SWAps. Further develop and scale up systems that effectively manage development results and provide the incentives for achieving health outcomes. Taskforce on Innovative Financing for Health Systems Raising and Channeling Funds Working Group 2 report,Final Draft, 3 June 2009

Development Assistance Perspective Country Perspective (low- and middle- income) RBF Two perspectives

ARGENTINA: PLAN NACER Ministry of Finance looking to link decision making to observable results $ $ $ Transfers from federal to provinces (15) based on # of poor women, children enrolled in social insurance program and performance on key output measures Decision: Devolution of federal budget to lower levels in the health system accelerated, in part, by successful results

% Low uptake of services, especially among the poor Source: Yazbeck, 2009; Gwatkin, 2007 Date of DHS

% Low uptakes of services, especially among the poor Source: Yazbeck, 2009; Gwatkin, 2007 Date of DHS

Source: Bryce J, et al., Improving quality and efficiency of facility-based child health care through Integrated Management of Childhood Illness in Tanzania, Health Policy and Planning, 2005, i69-i76 Quality concerns, even following traditional performance-improvement interventions (training, follow-up and job aids)

Providers widely dispersed, far from support Many lack tools, skills, information Many operate without supervision most of the time Motivating supervisor-provider relationship rare Little recognition, respect from peers, supervisors Few opportunities for advancement Civil service salaries low, often irregular Teamwork, cooperation usually weak Absenteeism, local autonomy or innovation limited Current incentive structure contributes to poor performance

CambodiaBangladeshBoliviaGuatemalaHaitiIndiaMadagascarPakistan RBF Source: Buying results? Contracting for health service delivery in developing countries, Loevinsohn B. and Harding A., The Lancet, 2005, 366, Far-ranging experimentation with provider payment reforms

Conditional cash transfers to increase service use (Mexico, Nicaragua, etc.) Voucher schemes for free or highly subsidized services Conditional cash payments (maternal health in India) Recipients of care (demand) Contracts for public, non-profit, and for-profit service providers (Rwanda, Zambia) NGO service delivery contracts (Afghanistan, DRC, Haiti) Incentives for health workers for institutional deliveries (India) Providers/facilities (supply) Global health partnerships (GAVI ISS) Conditional loan buy-downs (Polio eradication) Incentives for provincial governments to improve maternal and child health (Argentina) Inter- and Intra- governmental Transfers

RBF Results and systems thinking Alignment with other reforms Political stewardship Regulatory change SustainabilityScaling Up Institutional change

Select action or output Define indicators Set targets Perform Measure performance RBF in principle… But… Effort in one, several areas may result in neglect of others Too ambitious, too easy Beneficiaries must control behavior change Too many, too few Gaming the system Reliability, validity of administrative data Cost of independent verification Too much $, too little Undermining intrinsic motivation Rules of game Unnecessary provision or demand Quantity trumps quality Reward or sanction Numerous possible implementation hazards

 Conditional Cash Transfers (CCTs) rigorously evaluated  Bulk of evidence from Latin American and Caribbean countries; some encouraging evidence from Bangladesh, Cambodia  Effective in reducing poverty in the short term  Substantial increases in use of health services, primarily preventive services  Impact on outcomes mixed  Typically require complementary supply-side actions Solid evidence on demand side Source: Fiszbein et al., 2009 RBF

 Supply side: generally weak designs  Argentina: increased enrollment of poor, previously uninsured women and children  Afghanistan and Cambodia: increases in immunization, prenatal visits, overall service use, equity gains  Many confounding factors (increased financing, TA, feedback, supervision, training, etc.) make it difficult to isolate effect of “incentive” Limited, mixed evidence on supply side RBF

Rwanda leading the way in sub-Saharan Africa Source: Gertler, et al., 2009 Rwanda: performance bonus scheme  Prospective, quasi-experimental design  Effect of incentives was “isolated” from effect of additional resources  Equal amount of resources without the incentives would not have achieved the same outcomes  Improved child health outcomes: height for age, morbidity

Rwanda leading the way in sub-Saharan Africa Source: Gertler, et al., 2009  Less impact on demand-sensitive interventions (ANC)  Rwanda now piloting community-based performance bonus to increase demand  Government adopting culture of results – moving RBF to Education and other sectors

 Little information on “why” demand and supply schemes succeed or fail  Insufficient information on unintended consequences  Sound monitoring, documentation and evaluation of new initiatives will be critical Need to open the “black box “ of implementation

Current initiatives GAVI support through HSS Global Fund support Evaluation needed New initiatives: Multilaterals World Bank Health Results Innovation Trust Fund ($95m) EC ‘s “variable tranche” approach to budget support (Vietnam, Laos) New initiatives: Bilaterals Norway support to Nigeria, Tanzania, Ethiopia AusAid currently considering options; funding seed grants USAID providing technical support and training

 Eight grants linked to IDA credits to finance the national strategy (International Health Partnership + principles) with focus on MDGs 4 and 5  Why linked to IDA credits?  Integrates RBF into broader policy dialogue between MOF and MOH  Engages Bank operational staff at country level and headquarters  Embeds RBF into Bank support for HSS  Potentially leverages additional IDA for health  $95 million from Norway supports comprehensive design, implementation, monitoring and impact evaluation

The WB Health Results Innovation Trust Fund CountryStartEnd (approx.) Eritrea D.R. Congo Zambia Rwanda Afghanistan Benin Kyrgyz Republic Ghana Design

 Afghanistan: performance-based bonus payments to NGOs  DR Congo: performance-based bonus payments to public facilities and health workers  Eritrea: demand-side incentives to mothers and performance budgets to administrative levels  Rwanda: performance-based contracting with community organizations to increase demand  Zambia: performance-based bonuses to public facilities and district

Inputs Activities Outputs Outcomes Long-run results Improved coverage of population with high impact interventions Improved quality of care Health promoting behavior change Maternal mortality reduction Infant and child mortality Reduction Impact EvaluationMonitoring and Documentation A common M&E Framework for RBF Contractual services used, delivered and reporting verified Regular, timely, appropriate incentive payments made or withheld Contracted work program activities executed Support activities implemented Innovative, improvised solutions applied Resources (time, people, money, commodities, etc.) mobilized Health system platform strengthened (policy, regulations, HMIS, financial procedures, etc.)

RBF is appealing to governments  Motivation and creativity to strengthen health systems  Flexibility to engage all providers (public, private, NGO)  Culture of results - replacing focus on inputs  Facilitates targeting – at poorest, MDG 4/5

 Both demand and supply side matter – and must be balanced  RBF not panacea! – must be part of broader dialogue with Ministries of Health and Finance and linked to investments in health  Still building evidence base but exciting potential  Accelerate progress toward MDGs  Implement Paris/Accra Principles – align with the International Health Partnership