Performance-Based Intergovernmental Transfers Brazil s Family Health Program And Argentina s PLAN NACER Program Jerry La Forgia World Bank National Workshop for Results-Based Financing for Health Jaipur, India January 28, 2010
Overview Brazil New financial system PSF incentive to increase coverage Pilot incentive scheme to increase coverage, efficiency and effectiveness Argentina Results-based model Financial flows Indicators
Issues Facing Brazil s MOH 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? How to lower the transaction costs of federal financing for health?
Financial Reform for Federal Health Allocations Old system: Too many parallel systems (30+) Difficult to track $ Much administrative overlap Weakened already weak capacity Awkward agreement - based system fiefdoms New fund-to-fund system (mid 1990s) Single and consolidated financial platform - all health financing sources channeled through same financial system Establishment of federal, state and municipal Health Funds All programs and investments brought into single account Subnational entities made responsible for entire financial package independent of funding source Created opportunity for performance-based financing
Old System State treasury State Health Secretariat Services, Programs, Investments GoB Municipal Treasury Municipal Health Secretariat Services, Programs, Investments
Brazil Federal Financing Subsystem for Health: STATES (mainly specialty and hospital care) FEDERAL TREASURY STATE TREASURY Budget Transfers FEDERAL HEALTH FUND FEDERAL HEALTH MINISTRY Transfers STATE HEALTH FUND STATE HEALTH SECRETARIAT Provision and/or purchasing of services
Brazil Federal Financing Subsystem for Health: Municipalities (mainly primary care and population-based health) Budget FEDERAL TREASURY FEDERAL HEALTH FUND FEDERAL HEALTH MINISTRY Transfers State Treasury State Health Fund Transfers Transfers MUNICIPAL HEALTH FUND MUNICIPAL HEALTH SECRETARIAT MUNICIPAL TREASURY Provision and/or purchasing of primary care services; Operation of population health programs
1994+ The Case of the Family Health Primary care program Program (PSF) Active outreach and prevention Tracking of family and community health Based on Family Health Approach Team: doctor, nurse, nurse auxiliaries and community health agents
PSF: Original Priority Areas 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 hypertension 4. Control of diabetes 5. Control of tuberculosis 6. Elimination of leprosy 7. Prevention of, testing and counseling re. HIV including prevention and treatment of STIs 8. Oral health 9. Health promotion activities 10.Population-based health activities
PSF Performance-based Financing Scheme 1998+ Emphasis on PSF coverage extension Incentives to states 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)
Financial Incentives for Family Health Program (2002) 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
Annual Number of PSF Team, 1994-2008
Recent Reforms (2006) Consolidated 74 separate financial transfers into 6 block grants: (basic care, medium and high complexity care, health surveillance, pharmaceuticals, and management). State and municipal managers can reallocate resources to activities and interventions within each block (but not across blocks) Block-based allocations linked to signed performance agreements with performance indicators Must use federal funds for intended purposes But financing is yet to be linked to indicator compliance
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 SCHEME FOR PARTICIPATING MUNCIPALITIES (variation in per PSF team allocations according to performance category) (a) $2X (b) (c) $2.5X maximum per team Allocation Coverage Improvement (d) (e) (f) (g) $X minimum per team allocation (h) (i) $1.5X Efficiency, Effectiveness, Fiduciary Improvement
Indicators Effectiveness 1. Increase in per capita medical visits PSF teams 2. Infants <1 with complete vaccination regimen (DPT-H, polio, measles, tuberculosis) 3. Pregnant mothers with 7 or more pre-natal consultations 4. % patients referred from Family Health teams for specialized care over total number of PSF medical consultations Efficiency 5. % reduction of hospital admissions for stroke 6. % reduction of hospital admissions for children <5 for acute respiratory infections (ARI) Management 7. 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- 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)
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 Federal Health Ministry 60% on verified enrollment Per capita Based Transfers 40% on verified Tracer indicators State Health Authorities Fee-for service Provision of documentation on enrollment and services Public providers Private providers Provision of service package Fund releases triggered by verification of outputs Auditor
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
Percent Accomplished Results 100.00% 90.00% 80.00% APL-1 Tracer Accomplishments: Goal vs.outcome Goal Outcome 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% 1 2 3 4 5 6 7 8 9 10 Tracers
Business as Unusual For the first time in Argentina s public health sector, national financial transfers to the states are linked to verifiable results. Also for the first time, financing of public providers is done on the basis of delivery of services to eligible population. New output and outcome data is beginning to serve as basis for strategy and planning at provincial level Social accountability has also increased significantly.