Performance Based Financing


PBF is an innovative, results-oriented approach that incentivizes health providers based on their performance, which is defined predominantly as the quantity and quality of their services. PBF involves contracts with individual health providers and performance frameworks at multiple levels of the health system. The PBF approach in many countries seems to have led to changing the behavior and work practices of providers, increasing their productivity and improving the quality of health care provided. Implementation of PBF has significantly increased over the past 15 years, with over 30 Sub-Saharan African countries currently employing PBF within their health systems.

MCDI is currently working with the World Bank and the Ministry of Health in Lesotho to implement a PBF program that supports the provision of maternal and newborn healthcare, and has worked in the Central African Republic as an External Evaluation Agency (EEA) to counter-verify PBF data.

How does PBF improve health systems?

PBF allows a health system to have autonomy over their resources through clearly defined and measurable performance targets. This approach allows for greater accountability and improved efficiency within a country’s health system as health providers can tailor initiatives to suit the populations they serve.

Lesotho Performance Purchasing Technical Assistance (PPTA)

In 2009, Lesotho faced a very high maternal mortality ratio of 1,155 per 100,000 live births, with only a slight decline between 1990 and 2010. The Ministry of Health of Lesotho recognized the need for PBF within their health system to streamline curative and preventative health care in order to improve the availability and quality of care.

Since 2014, MCDI has worked with the Lesotho Ministry of Health's Performance Based Financing Unit through the PPTA project funded by the World Bank through a contract with the Ministry. With partner Health Works, MCDI works to strengthen the capacity of the Ministry of Health's PBF Unit and to assist in PBF operations, including purchasing of services and verification. The PPTA verifies invoices of services, and worked with local community-based organizations to conduct consumer surveys in order to verify the quantity and quality of services provided.

MCDI provided technical assistance to develop a PBF User's Manual, published by Ministry of Health of Lesotho in January of 2016, which helps to streamline the PBF process throughout Lesotho and acts as an operational guide for all levels of the PBF system. The PBF project in Lesotho has recently expanded to every health district in the country.

Central African Republic PASS

MCDI has served as the External Evaluation Agency for the Health System Support Project (PASS), implemented by the Government of the Central African Republic with funding from the World Bank. MCDI serves a counter-verifier of service delivery data prior to the payment of PBF incentives to contracted health providers.

In addition to providing counter-verification, MCDI has conducted operational research on the results of PBF in the selected regions to inform future innovations in health care delivery within the country.