0. The Global Fund policy on Sustainability, Transition and Co-financing and the Funding Cycle Process

1. Webinar Objectives & Key Focus Areas
Main Objectives:
Review the Global Fund’s STC Policy, and the way it affects sustainability, transition preparedness, and transition
Understand the linkages between the STC Policy and the upcoming Funding Cycle, including Co-Financing
Discuss the core aspects of a Transition Tailored Review Application for funding
Review the basic concepts and thematic areas of transition planning 1
Core Principles of the STC Policy 2
STC Policy and Sustainability and Transition 3
Transition Projections and Preparedness 4
Understanding Co-Financing 5
Transition Tailored Review 6
Transition Planning and Assessments 7
Questions and Answers

2. What is the Sustainability, Transition and Co-Financing Policy?
The Sustainability, Transition and Co-Financing Policy (STC Policy) brings together three inter-related themes to provide a coherent approach to delivering the long-term sustainability of health systems and national disease responses for HIV, TB, and Malaria.

3. The S, the T, and the C Co-financing Sustainability Transition
Investing to
End Epidemics
Sustainability
Co-financing
Transition
BUILD RESILIENT & SUSTAINABLE SYSTEMS FOR HEALTH
MAXIMIZE IMPACT AGAINST HIV, TB AND MALARIA
PROMOTE & PROTECT HUMAN RIGHTS AND GENDER EQUALITY
MOBILIZE INCREASED RESOURCES
one of the tools
a process
Desired outcome
Goal

4. Sustainability and Transition in a Global Fund Context
The ability of a health program or country to both maintain and scale up service coverage to a level, in line with epidemiological context, that will provide for continuing control of a public health problem and support efforts for elimination of the three diseases, even after the removal of external funding by the Global Fund and other major external donors.
Relevant to all countries
Transition
The process by which a country moves towards fully funding and implementing its health programs independent of Global Fund support while continuing to sustain the gains and scaling up as appropriate
Transition preparedness should be a priority for all LMI countries with ‘low’ and ‘moderate’ disease burden and all UMI countries

5. How does the STC Policy relate to the 2017-2022 Strategy?
The Global Fund Strategy places a strong emphasis on the need to support sustainable responses for epidemic control and successful transitions away from direct grant support. It also stresses the need to support countries to use existing resources more efficiently and to increase domestic resource mobilization.
MAXIMIZE IMPACT AGAINST HIV, TB AND MALARIA
BUILD RESILIENT & SUSTAINABLE SYSTEMS FOR HEALTH
PROMOTE & PROTECT HUMAN RIGHTS AND GENDER EQUALITY
MOBILIZE INCREASED RESOURCES

6. What is it designed to do?
RISK
Financial
Programmatic
Alignment
Governance
The policy takes a proactive approach to addressing the sustainability challenges and transition risks faced by a broad range of countries and grant components

7. What principles is it based on?
Alignment
With existing systems or processes
Differentiation By income level
STC Policy
Predictability Of time and resources to plan
Flexibility To adapt to particular contexts

8. Why is it important? Challenges and lessons learned
Service Continuation
Governance
Programmatic Risks
Data Risks
Financial Dependency
MONTENEGRO

9. Why is it important? Successes and lessons learned
Political will and government leadership
Accounting for human rights and gender
Investing in health systems and local capacity
Aligning program design with government systems
Early start and clarity on transition details
Planned, multi-stage, gradual timelines
Investing in transition
Monitoring programs after transition

10. The STC Policy and Sustainability
Sustainability is a key aspect of development and health financing, and all countries, regardless of their economic capacity and disease burden, should be planning for and embedding sustainability considerations within national strategies, program design, grant design, and implementation.
Key aspects of sustainability planning:
Strengthening of National Strategic Plans
Development of health financing strategies
Alignment and integration of systems
Identifying efficiencies and enhancing optimization of disease responses
Increased domestic financing of national disease response and interventions financed by the Global Fund, including via co-financing

11. STC Policy, Transition, and Transition Preparedness
Early and proactive engagement with countries is essential to enhance transition preparedness (encourages planning 10 years out). Transition is a process – it depends both on eligibility, but is also affected by changes in allocation (and the ability to finance the national disease response with that allocation)
Key Aspects of Transition Planning:
All sustainability planning, plus:
Development of Transition Readiness Assessments, Transition Strategies, and/or Sustainability Plans
Progressive and accelerated government financing of key interventions
Enhanced focus on key populations and structural barriers to health access (including human rights)
Enhanced focus in grants on thematic areas that could represent sustainability and transition gaps, including: contracting of non-state actors, strengthening of M&E and procurement systems, reduction of dependence on Global Fund for purchasing commodities, etc.

12. LMICs with low/moderate disease burden / UMICs LMICs with high disease
Funding request based on Transition Work-plan
Co-Financing requirements along the development continuum work towards enhancing program sustainability and eventual transitions
LMICs
with low/moderate
disease burden
/ UMICs
LMICs
with high disease
burden
LICs
Ineligible
“Final Grant”
Focus on sustainability and transition preparedness, particularly for countries projected to transition
Max.3 years funding to implement transition activities
Focus on long-term sustainability planning by supporting the development of robust national health strategies, disease specific strategic plans and health financing strategies
Fully
transitioned
All sustainability activities +
Preparedness Measures:
Transition Readiness Assessments and Transition Strategies
Addressing transition challenges in grant and program design
National Strategic Plans
Health Financing Strategies
Alignment with country systems

13. …to Ineligibility …to transition From Eligibility…
Global Fund Eligibility is based on income level and disease burden.
The 2017 Global Fund Eligibility List identifies disease components (HIV, tuberculosis or malaria) which are eligible and may receive an allocation.
A country may be eligible for one component (due to its heavy burden) but not another.
A country moves to high income status (*and are not eligible for transition funding);
A country moves to upper-middle income (UMI) status and disease burden for a component is low or moderate;
Disease burden for a component decreases to low or moderate in a country classified as UMI;
A country is a member of the Group of 20 (G20) countries and moves to UMI status, and the disease burden for a component is less than extreme;
A country joins the Organization for Economic Co-operation and Development’s (OECD) Development Assistance Committee (DAC)
Once a country component becomes ineligible, it may receive transition funding under the stc policy

14. Modifications in allocation during this process
LMICs
with low/moderate
disease burden
/ UMICs
LMICs
with high disease
burden
LICs
Ineligible
Max.3 years funding to implement transition activities
As a country moves along the development continuum, its possible that there are reductions in the size of the Global Fund allocation
Reductions in the size of the allocation may require a country to progressively assume key parts of the national disease response, even multiple allocation cycles prior to transition because of ineligibility
Countries are encouraged to plan early, and work to increase financing of all key interventions of the national disease response as they move along the continuum
The Global Fund review of funding applications for UMICs and LMICs with low/moderate disease burden will include considerations around how transition preparedness is incorporated in the national disease response

15. Where should transition preparedness be a focus?
All UMICs and LMICs with ‘low’ and ‘moderate’ disease burden should proactively enhance transition preparedness
This does not mean that all UMICs and LMICs with low and moderate disease burden are exiting Global Fund financing. But it does mean that planning for eventual transition should be a priority and considerations for transition should be built into co-financing commitments, grant design, and program design
There are 14 disease components “transitioning” in the allocation cycle (i.e., may receive transition funding due to ineligibility)

16. UMICs and LMICs with Low / Moderate Disease Burden
Low and Middle Income Countries (LMICs) with at least one disease component with low /moderate DB
Upper Middle Income Countries (UMICs)
Please note that this is based on 2016 data and not currently updated with the 2017 eligibility list.
Source: Global Fund Eligibility List 2016

17. Transition Preparedness Priorities: Upper Middle Income countries (regardless of disease burden) and lower middle income countries with low or moderate disease burden:

18. Who is transitioning now, and who is projected to transition?

19. Co-Financing - Why is it important?
As they increase fiscal capacity, countries are also expected to increase contributions to disease programs and health systems
Domestic funding should progressively absorb costs of key program components, including but not limited to:
human resources
procurement of essential drugs and commodities
programs that address human rights and gender related barriers and programs for key and vulnerable populations.
STC Policy includes a co-financing policy aimed at incentivizing increased domestic resources for health, and progressively focused investments along the development continuum as a country prepares for transition.

20. Revised Co-Financing Policy
No restriction
Minimum 50% in disease programs
Focused on disease program and systems to address roadblocks to transition; minimum 50% in key and vulnerable populations
75% in disease programs*
Minimum 15% Co-Financing Incentive
* ‘low’ or ‘moderate’ burden country components are encouraged to show a greater share of domestic contributions that will address systemic bottlenecks for transition and sustainability.
Progressive absorption of key program costs (all countries)
Upper-Middle Income Countries
Low Income Countries
Lower-LMI Countries
Upper-LMI Countries
Progressive government expenditure on health (all countries)
Revised Co-Financing Policy
Engagement with Ministries of Finance and or relevant bodies for confirmation of domestic commitments
Continued support for public finance management systems and health expenditure tracking
Co-financing incentive of at least 15% of the allocation:
Focus on broader health systems at lower end of the development continuum
More targeted focus on disease programs, key and vulnerable populations, and transition and sustainability priorities as countries along development continuum

21. Sustainability: Focus of Applications and Co-financing
Income
Level
Disease
Burden
Focus of application
Requirements
Parameters
Low Income Countries No
restriction
No restriction
No restriction
Incentive for Strategic Investment:At Atleast 15%
Lower-LMI Countries No
restriction
50% focus on key and vulnerable populations/
interventions
Minimum 50% in disease programs
Upper-LMI Countries No
restriction
Minimum 75% in disease programs**
Progressive government expenditure on health (all countries)
Progressive absorption of key program costs (all countries)
Focused on disease program and systems to address roadblocks to transition; minimum 50% in key and vulnerable populations
Upper-Middle Income Countries
Severe, High or Extreme
100% focus on interventions that maintain or scale-up evidence-based interventions for key and vulnerable populations
Extreme
(G-20)
UMICs with low/moderate DB, G-20 UMIs with less than extreme DB, and High Income Countries are ineligible

22. Applying the STC principles into the funding cycle process
STC Policy
Differentiation By income level
Alignment
With existing systems or processes
Flexibility To adapt to particular contexts
Predictability Of time and resources to plan

23. Context: Overview of Differentiated Application and Review Modalities
Focused and Core country components with less than 2 years of implementation (High Impact considered on case-by-case basis); or
Focused and Core country components with demonstrated performance and no material change needed (High Impact considered on case-by-case basis);
Note: To maximize impact against the diseases, program continuation components may in addition reprogram at any time (during grant making or grant implementation) & OPN on reprogramming will apply.
Program continuation: streamlined process for program continuation
Country components requiring material change in defined programmatic area(s); or
Country components receiving Transition Funding or otherwise using a transition work plan as basis for their funding request (TBD)
Challenging operating environments (COE) country components with material change; or
Innovative approaches, learning opportunities or results-based financing modalities (RBF)
Tailored Review: tailored to the objective and to the applicant type
High Impact country components
Focused and Core country components referred to full review
Country components not reviewed by the TRP in the previous allocation period
Full Review: comprehensive overall review of investment approach and strategic priorities

24. What is the Transition Tailored Review?
Approach: Disease components receiving their final round of transition funding and those projected to become high income countries will apply for funding using the Tailored Transition Review.
Application materials completely tailored to transition activities
Funding request based on country-level activities in the Transition Work Plan
Identification of gaps and challenges based on Transition Readiness Assessment and National Strategic Plan
Proactive approach to transferring service provision and key interventions to national authorities before the grant ends
Funding should focus on priority needs and investments that address transition and sustainability bottlenecks, as well as for key and vulnerable populations

25. Who will use the Transition Tailored Review?
16 disease components
Ineligible since ; May receive transition funding for
Albania (HIV, TB)
Algeria (HIV)
Belize (TB)
Botswana (malaria)
Bulgaria (TB)
Cuba (HIV)
Projected to become ineligible in
Malaysia (HIV)
Panama (HIV)
Dominican Republic (TB)
Paraguay (TB, malaria)
Panama (TB)
Sri Lanka (malaria)
Suriname (TB)
Turkmenistan (TB)
*Please note that there may be additional circumstances when a country may use the “transition-tailored approach” given country context

26. What about all the other components in UMICs and LMICs with low and moderate disease burden?
Although not all countries will be applying through a transition tailored review, the GF encourages all UMICs and LMICs with low and moderate disease burden to integrate considerations regarding transition preparedness into their funding requests
Given that successful transitions take time, the Global Fund encourages countries to plan in advance
Early analysis of sustainability gaps and transition challenges can help countries address the problems before transition
All funding requests to the Global Fund will be reviewed, to some extent, with a sustainability and transition lens

27. What are key thematic areas in transition planning?
While this depends heavily on country context, some key areas to consider are:
Key area
What to consider
- Program for Key and Vulnerable Populations
- Capacity and Role of Non-State Actors in Service Provision
- Implementation of Global Fund grants
- Ownership of key interventions and integration into national systems
How reliant on the Global Fund is the country for interventions for key populations?
Can non-state actors contract with implementers to provide key services as part of the health system?
Are implementers of Global Fund grants integrated fully into the national health system, and can they manage the transition process?
Are all key interventions co-financed by national authorities, and are all systems aligned?

28. What are key thematic areas in transition planning?
While this depends heavily on country context, some key areas to consider are:
Key area
What to consider
Are key operating costs and trainings still covered by the Global Fund, and to what extent?
Salaries, operational costs and trainings
Strong monitoring and evaluation (M&E) systems
Reliable and efficient health products procurement and supply chain systems
Governance during and after transition
To what extent do M&E systems capture the key data needed, particularly around key and vulnerable populations?
To what extent are these able to deliver key commodities without GF support?
Are there mechanisms for long term inclusion of all key stakeholders in the national disease response?

29. Additional Thematic Areas in Transition Planning:
Epidemiological context: the drivers of infection and any key and vulnerable populations that might be disproportionately affected as well as age and gender related disparities and vulnerabilities.
Economic situation: the country’s macroeconomic outlook and the fiscal capacity of the government to increase public sector financing.
Political context: the term of the current government and its commitment to financing the disease program.
Policy and legal environment: the policy and legal issues that may impact on the transition.
Human rights and gender: human rights and gender related barriers in access to services including
Disease Program: the current interventions being implemented, service delivery coverage, across the dimensions of gender and age, and including for key and vulnerable populations, and an analysis of where scale-up is needed to achieve policy objectives.
Health systems: the current capacity for health systems planning, monitoring and evaluation; procurement system management including how first-line drugs are procured; what reforms are happening in the health sector and their potential relevance for the sustainability of the disease program; the enabling factors required for transition and what systems components present roadblocks to transition.
Financing: who are the major funders, how the public financial management system is structured, whether key services of the disease program are included in the national health insurance.

30. Clarifying Terminology: TRAs, Strategies, Work-Plans
Transition Readiness Assessment (TRA): Refers to the different tools, both developed in cooperation with the Global Fund and developed by technical partners, that identify existing gaps in the domestic system that may hamper effective transition from Global Fund financing and that facilitate identification and prioritization of policy solutions towards maintaining existing levels and quality of service delivery
Transition Strategy / Approach: A high-level plan for progressive domestic take-up of Global Fund financed activities. A solid transition strategy or approach establishes early the priorities and estimated sequencing of key steps that may foster a successful exit from Global Fund (and other donor) financing. Ideally, a transition strategy that considers the future of all donor financing would be part of the NSP or other existing disease plans. A transition strategy may take many forms – it does not need to be a document or separate plan.
Transition Work plans: A transition work-plan is the specific, time-bound, costed plan that will guide a country’s transition from Global Fund financing, while at the same time ensuring that key interventions are maintained. A transition work-plan is required for all “transition grants”.
GF Transition Funding Request: This funding request may include all, or a sub-set of the key activities identified in-country in the Transition Work plan, depending on the level of funding available, and must rationalize this prioritization.

31. How do various tools support transition planning and the funding request?
Transition Readiness Assessment, Sustainability Analysis, Sustainability and Transition Strategies
Transition Readiness Assessment Tool
Allocative Efficiency Models
Health Systems Financing Assessment
Global Fund Funding Request
Transition Work plan
*Countries should use the tools they believe will best help them enhance sustainability, strengthen transition, and manage the transition process

32. How can CCMs lead in transition?
Country Coordinating Mechanisms (CCMs) can play a key role in the transition process
Central to the principal of local ownership and participatory decision-making
Play important role as country-level partnerships focusing on national priorities
CCMs have access to the strategic information about the program performance
Able to coordinate with national governments and across sectors
Can help ensure inclusive, multi-stakeholder and country-owned process

33. Country Dialogue and STC Considerations:
Sustainability should be a part of country dialogue discussions for all countries. Transition Preparedness should be a part of country dialogue for all UMICs and LMICs with low / moderate disease burden
Country Dialogue is a unique opportunity to ensure all actors in the national disease responses are engaged in a discussion on strengthening sustainability and preparing for transition, particularly people affected by the diseases and key and vulnerable populations
For countries currently in transition and or projected to transition in the next allocation cycle (based on the transition projections list), country dialogue is an excellent opportunity to shape the country-level dialogue regarding how maintaining key interventions will be achieved without Global Fund financing

34. What additional resources does the Global Fund have?
Published Documents and Resources:
STC Policy – Available here [link]
Transition Projections Document – Available here [link]
Global Fund Eligibility List – Available at [link]
Forthcoming Documents:
STC Technical Guidance Note – forthcoming
Questions and Answers about the STC Policy – forthcoming
Early Engagement with Country Teams:
Engage your FPM and Country Team Members Early in the STC Discussion
For Latin America, EECA, and Southeast Asia, Sustainability and Transition specialists are now built into country teams