Sharing knowhow and joining forces towards Health for All

Cordaid and Performance Based Financing

Cordaid and Performance Based Financing

In 2001, Cordaid was one of the first organizations worldwide to introduce the Result Based Financing (RBF) approach to health care in sub-Saharan Africa. RBF improves health services for the poorest and most vulnerable people, especially in isolated, rural areas. The essence of RBF is a direct link between funding and results: healthcare providers are only paid when they can demonstrate that either their medical services have been improved and they have effectively treated more patients with the allocated funds.

In 2010, it was observed that 22 African countries were planning for, or started some form of RBF pilots programs. Two countries (Rwanda and Burundi) adopted RBF as their national policy and scaled it up successfully, while some others such as the Central African Republic and Cameroon may soon follow. Cordaid is supporting PBF interventions in Rwanda, Burundi, Tanzania, Zambia, Democratic Republic of Congo (DRC), Cameroon, Central African Republic (CAR), Zimbabwe and Congo Brazzaville (RC). Possibilities to pilot the approach are currently being explored in South Sudan en Haiti.

In a health system which is based on RBF, all stakeholders have their specific role. Community organizations carefully check with patients and their families if medical services were indeed provided and how patients perceived the quality of services. Government bodies are supported in planning, monitoring and controlling the medical quality of services. Health Facilities (providers) are assisted in drafting operational plans to improve their services.

Result based financing determines the results of health care providers on the basis of a comprehensive set of output indicators, such as deliveries, number of children vaccinated and score on quality. A purchaser buys these results - a fee is paid for each service rendered. Different organizations may assume the role of purchaser: it might be an independent NGO, a separate government body or a health insurance company. Conditions for the provision of the service are stipulated in a contract between the health facility (provider) and the purchaser. Within the contractual framework, the providers have ample freedom to develop innovative strategies to achieve results. This way, RBF also feeds social entrepreneurship.

An important element of RBF is the system of checks and balances created by assigning different tasks to separate stakeholders. Community organizations interview care recipients to evaluate satisfaction. The Ministry of Health (the regulator) checks the quality of care, the purchaser verifies patient numbers and a fundholder pays providers based on verified information. This working method clarifies the roles of each stakeholder and increases accountability, transparency and legitimacy. As such it has also proven to be a stabilizing strategy in conflict situation. It is a tool to bring people together and formalize relationships.

Additional innovations

Cordaid is now working towards introducing more innovations in the RBF approach, such as adding demand-side initiatives like cash transfers to patients and risk-pooling mechanisms (health insurances). A cash transfer is paid to take away barriers for a patient to visit a hospital or to acquire preventive resources such as contraception. Risk-pooling is the principle of creating a collective “pot” to cover the community’s medical expenses. Steps like these will make health care more accessible to even the most vulnerable.

Information updated: September 2012

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