Making Performance-Based Funding Work for Health

Policy Forum T here have been signifi cant increases in development fi nance since 2000, particularly for health [1,2]. As country programs put this money to work, important lessons and challenges on how to make health fi nance more effective emerge. Performance-based funding provides clear incentives to achieve results and has been used by organizations such as the Global Fund to Fight AIDS, Tuberculosis and Malaria (the Global Fund) [3,4]. However, there are concerns that performance-based funding may penalize poorer countries and may not be fl exible enough to contribute to health systems generally. Such concerns provoke two important questions: How are programs performing in countries at different levels of development, health systems strength, and disease burden? And what are the wider challenges of implementing performance-based funding to use health fi nances effectively, strengthen health systems, and achieve the Millennium Development Goals (MDGs)? To give an example, the Global Fund has disbursed US$3.24 billion to programs to fi ght HIV, tuberculosis (TB), and malaria in 130 countries and uses performance-based funding to evaluate program performance and manage grants. Funding is not guaranteed but is released based on demonstrated results against agreed country-owned targets and indicators that are set out in the initial grant agreement. Supporting Information File S1 provides an extensive analysis of the results of 370 active grants to fi ght AIDS, TB, and malaria in 130 countries by programmatic service delivered, region, type of recipient, and country characteristics. Supporting Information File S2 gives a table of key data on grants reviewed with their ratings, principal recipient characteristics, disease component, and fi nancial information. The analysis shown in File S1 assesses whether performance-based funding penalized poorer countries or those with weaker health systems. The results show the rapid scale-up of services to people in need, doubling each year, with fi nanced programs providing 1.1 million people with HIV treatment, 2.8 million people with TB treatment, and 30 million people with insecticide-treated bednets (ITNs) to protect families from malaria. Most importantly,75% of country programs reached their targets and were able to make the money work to deliver AIDS, TB, or malaria services. Of the remaining country programs, 21% had inadequate results but displayed the potential to accelerate implementation and achieve targets in the future, and 4% showed unacceptable results. Sub-Saharan Africa did not show substantially worse performance than other regions. The poorest third of countries performed no worse, indicating that …