Performance-BasedIntergovernmental Transfers

Brazil’s Family Health Programand

Argentina’s PLAN NACER Program

Jerry La Forgia

With thanks to Rena Eichler and Christian Baeza

Summary

• Brief overview of results-based financing• Brazil ‘s Family Health Program

– incentives to increase coverage– Pilot incentive scheme to increase coverage,

efficiency and effectiveness• Argentina’s Plan Nacer

– Results-based model– Financial flows– Indicators

Why consider Results Based Financing?Business as usual is not working

• Problems– Coverage/utilization/access– Uptake of preventive services– Quality– Volume– High OOP spending

Many labels

• Pay for Performance or “P4P”• Results-Based Financing or RBF• Performance-Based Financing• Output-Based Financing• Performance-Based Contracting• Performance-Based Incentives• Conditional Cash Transfers• Conditional Cash Payments

Concept

Payers(Government, Health Programs, Insurers,

Communities)

Payers(Government, Health Programs, Insurers,

Communities)

Recipients(Households, Service Providers (Facilities, Health Workers), Health Programs, Sub-National Levels

of Government

Money,Goods,

Other Rewards

Well-defined and measureable

results

Levels to consider: from payer to recipient

Demand Side (Household, Individual)

Types of Approaches(supply side)

• Pay for quality– Pay for structure (e.g., personnel, training)– Pay for process (e.g., use of protocols, patient

tracking, – Pay for accreditation– Pay for mistake prevention (e.g., control of adverse

events)– Pay for outcomes (e.g., reduction in readmissions)

• Pay for targeted service delivery (e.g., immunizations)

• Pay for production or utilization• Pay for insurance coverage• Pay for information collection and reporting

Types of Approaches(demand side)

• Pay for healthy behaviors (e.g., program participation and retention; reduce rates of highly additive behaviors; smoking cessation )

• Paying for health care behaviors (e.g., preventive visits, follow-up visits, blood pressure control, immunizations, institutional deliveries, etc.)

Possible Pitfalls• Excessive attention to reaching targets to detriment of other

interventions or services• Undermining intrinsic motivation, turning health care

delivery into “piecework”• “Gaming,” – managing the metric• Cream skimming • Institutional readiness

– Rules of game (ex. Agreement/contract, stakeholder consultations)– Pay on time– Define measureable indicators– Monitor and verify indicators (catch “inflators”)– Enforcement (political interference)– Degree of provider autonomy (let managers manage)

Other Issues

• The problem of small numbers• The luck of the draw (or not)• How much of an incentive is needed to

capture provider attention?– Dependent on provider transaction costs?

What about impact?• Studies with robust methods and samples are far

and few between• Many experiments underway• Results so far -- Mixed bag for provider-targeted

incentives– Some improvements– Providers do respond to incentives– Attribution problem; unclear causal linkage– Ad hoc interpretations

• More robust results for patient-targeted incentives– Addictive behaviors and care behaviors

Lessons Learned• In-flight adjustments are common as scheme matures• P4P costs!

– Finding resources to sustain program– Need for TA investments

• Plateau effect– How to incentivize continuous improvements?

• Burden/cost of data collection– Ensuring data validity

• Perverse effects– Lower volume/quality for activities not incentivized

• Incentives may be too weak to overcome other incentives embedded in payment mechanism

Getting from Here to There1. Assess and prioritize performance problems2. Consult stakeholders3. Select recipients4. Define indicators, targets and how to measure them5. Set payment rules, sources of funds, and how funds

will flow 6. Determine management and operational roles and

systems– Establish contracts/agreements– Routine Monitoring– Validation– Payment– Assess and revise

Inter-governmental Transfers

Brazil’s Family Health Program

Institutional ReadinessFinancial system reform

• How to make federal government financing for health more effective and less cumbersome?

• How to make subnational entities (states and municipalities) more accountable for use of federal financing?

Old System

GoB

MunicipalTreasury

Statetreasury

StateHealth

Secretariat

MunicipalHealth

Secretariat

Services, Programs,Investments

Services, Programs,Investments

MUNICIPALHEALTHFUND

FEDERALHEALTHFUND

Transfers

Brazil Federal Financing Subsystem for Health Implemented by Municipalities

StateHealth

Fund

Transfers

MUNICIPALHEALTH

SECRETARIAT

FEDERALHEALTH

MINISTRY

Paymentmechanisms

Privateproviders

Publicproviders Bene-

ficiaries

The Case of the Family Health Program (PSF)

• 1994+• Primary care program• Active outreach and prevention

– Tracking of family and community health– Based on Family Health Approach

• Team: doctor, nurse, nurse auxiliaries and community health agents

1. Women´s health pre-natal care, prevention of cervical cancer, family planning

2. Child health growth & development, nutrition, immunization, treatment of prevalent illnesses

3. Control of hypertension4. Control of diabetes5. Control of tuberculosis6. Elimination of leprosy7. Prevention of, testing and counseling re. HIV including

prevention and treatment of STIs8. Oral health9. Health promotion activities10.Population-based health activities

PSF: Original Priority Areas

PSF Performance-based Financing Scheme

• Problem: slow uptake of program by municipalities

• Objective: Provide incentives to municipalities to establish program and expand to poorest Brazilians– Flat one-time transfer for establishing each new

PSF team– Variable transfer to incentivize continuous

coverage extension (co-financed recurrent costs of teams)

Level Population Coverage Amount per team per year ($R)

1 0 to 4.9 % R$ 28.008,00

2 5 to 9.9 % R$ 30.684,00

3 10 to 19.9 % R$ 33.360,00

4 20 to 29.9 % R$ 38.520,00

5 30 to 39.9 % R$ 41.220,00

6 40 to 49.9 % R$ 44.100,00

7 50 to 59.9 % R$ 47.160,00

8 60 to 69.9 % R$ 50.472,00

9 70 % and more R$ 54.000,00

Financial Incentives for Family Health Program (2002)

Annual Number of PSF Team, 1994-2008

Pilot Scheme (2009+)

• Improve coverage, effectiveness, quality and efficiency of PSF in large cities

• Financing varies according to compliance with indicators

• Can earn additional 15% bonus for participation and establishment of quality certification program for PSF

PERFORMANCE-BASED INCENTIVE SCHEMEFOR PARTICIPATING MUNCIPALITIES

(variation in per PSF team allocations according to performance category)

(a)

$2X(b) (c)

$2.5Xmaximum per teamAllocation

(d) (e) (f)

(g)$X

minimum per team allocation

(h) (i)

$1.5X

Efficiency, Effectiveness, Fiduciary Improvement

Coverage Im

provement

IndicatorsEffectiveness  

1. Increase in per capita medical visits PSF teams2. Infants <1 with complete vaccination regimen (DPT-H, polio, measles, tuberculosis)3. Pregnant mothers with 7 or more pre-natal consultations4. % patients referred from Family Health teams for specialized care over total number of PSF medical consultations

 

Efficiency5. % reduction of hospital admissions for stroke6. % reduction of hospital admissions for children <5 for acute respiratory infections (ARI) Management7. PSF teams supervision Supervision plan (objectives, schedule, checklist) No. of municipal supervisors PSF teams supervised (with verified supervisory report)8. % PSF teams trained in at least 4 PSF strategic areas

Argentina’s Plan Nacer

Financing Health Sector Results

• Problem– Inequitable distribution of resources across

states and w/I states– Many poor Argentines lost health insurance

during economic crisis of 1997-2002– Increase in IMR and MMR rates

• Objective– Increase access to basic health services for

uninsured mothers (during pregnancy) and children (up to 6 years old), contributing to decrease infant and maternal mortality

– Target the poorest states (600,000 beneficiaries)

PLAN NACER

New Results-based Transfer model• Introduced financial incentives between the federal

government and provinces (states) and between the states and public and private providers, linking financing with results (output and intermediary outcomes).

• Established MCH package of services• Created capitation-based grant transfer based on

cost of MCH package– 60% of the capitation payment released upon monthly

certification of enrolment of eligible population, and – 40% of the capitation payment released for each of the 10

Tracers goals achieved (quarterly, ex-post audited by a concurrent auditor)

Funding flows

StateHealth

Authorities

FederalHealth

Ministry Privateproviders

Publicproviders

Provision of servicepackage

Per capita –Based Transfers

60% on verified enrollment

40% on verifiedTracer indicators

Fee-forservice

Auditor

Provision of documentation on

enrollment and services

Fund releases triggeredby verification of outputs

TRACERS•Timely inclusion of eligible pregnant women in prenatal care services•Effectiveness of neonatal and delivery care (Apgar Score)•Effectiveness of pre-natal care and prevention of premature birth (weight above 2.5 kilos)•Quality of pre-natal and delivery care ( number of mothers immunized and tested for STDs)•Medical Auditing of Maternal and Infant deaths•Immunization Coverage (measles vaccine)•Sexual and Reproductive Healthcare•Well child care (1 year or younger)•Well child care (1-6 years old)•Inclusion of Indigenous Populations

Design Elements• Certification by Independent Concurrent

Auditor

– Certification of beneficiary eligibility is done by the Concurrent Auditor through monthly cross-checking of beneficiary databases and enrolment registers.

– Certification of Tracers is done by the Concurrent Auditor through both, certifying surveillance and monitoring systems at provincial and provider levels as well as through sample auditing of medical records at provider level

– Penalties for erroneous billing (125% of capitation is discounted)

Design Elements• Fee-for-service payment to public and private

providers• Providers can use up to ½ of payment to pay staff

bonuses• Free choice of provider• State governments

– Enroll beneficiaries– Establish purchasing/contract management unit– Contract providers– Strengthened surveillance and monitoring systems

required to certify achievement of tracers

ResultsAPL-1 Tracer Accomplishments:

Goal vs.Outcome

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

80.00%

90.00%

100.00%

1 2 3 4 5 6 7 8 9 10Tracers

Pe

rce

nt

Ac

co

mp

lish

ed

Goal

Outcome

Business as Unusual

• For the first time in Argentina and Brazil’s public health sector, national financial transfers to the states and municipalities are linked to verifiable results.

• Also for the first time, in Argentina financing of public providers is done on the basis of delivery of services to eligible population. In Brazil, financing based on no. of enrollees, and more recently, reaching performance benchmarks

• New output and outcome data is beginning to serve as basis for strategy and planning at federal, state and municipal level