"In many low- and middle-income countries, health coverage has improved dramatically in the past two decades, but health outcomes have not. As such, effective coverage—a measure of service delivery that meets a minimum standard of quality—remains unacceptably low. Improving Effective Coverage in Health examines one specific policy approach to improving effective coverage: financial incentives in the form of performance-based financing (PBF), a package reform that typically includes performance pay to frontline health workers as well as facility autonomy, transparency, and community engagement.
This Policy Research Report draws on a rich set of rigorous studies and new analysis. When compared with business-as-usual, in low-income settings with centralized health systems PBF can result in substantial gains in effective coverage. However, the relative benefits of PBF—the performance pay component in particular—are less clear when it is compared with two alternative approaches, direct facility financing,
