4. Integrate all health financing functions by:
- Integrating results-based financing interventions with other health financing functions and the broader public finance context at the country level to address sustainability and prevent distortions and
- Developing a joint strategic approach between IFC and the Bank and complementary implementation on the ground, toward health insurance, including mandatory and voluntary coverage.
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The Bank can add value by stressing its comparative advantage via linking health financing with public finance and working across teams, as suggested in the 2007 HNP strategy.
An integrated approach that links health financing, including RBF, with public sector reforms is likely to be more effective than single-issue interventions in establishing the relevant institutions that are needed to sustain reforms.
The health financing collaboration between the IFC and the Bank has been limited so far.
WB: Agree. The second phase of the RBF will include an explicit emphasis on fiscal limits and sustainability. WB, IFC Agree. The HNP GP will be working on developing a joint strategic approach with IFC toward health insurance.
Action 6: Design RBF interventions consistent with budget formulation, execution, reporting and procurement.
Indicator: % of WB active operations supporting RBF schemes integrated into public financing systems of health care providers .
Baseline: TBD (FY2015)
Target: TBD
Action 6: Design RBF interventions consistent with budget formulation, execution, reporting and procurement.
The indicator selected to monitor progress under Action 6 is "the percentage of World Bank active operations supporting RBF schemes integrated into public financing systems of health care providers". IEG confirms the efforts made by HNP to expand the share of World Bank RBF operations that are "on budget". In FY15 (the baseline year) already 96% of WB active operations supporting RBF schemes appeared to be integrated in public financing systems (i.e. "on budget"). This was already above the target for FY18 of 90%. The same percentage (96%) was estimated in FY16 and in FY17 the percentage estimated was 93%.
IEG also acknowledges that HNP has been consistently advocating the importance of increasing "on budget" development assistance for health (DAH in global venues (e.g., keynote speech delivered at the Second Annual UHC Financing Forum). IEG also recognizes the expanded partnerships and collaborations established with other WBG teams: (i) the Governance global practice to study where and how public financial management (PFM) and health financing good practices may conflict, creating challenges in client countries implementing RBF (ii) IFC on a joint approach to incorporate private sector delivery in budgets and use all available tools (e.g., contracting, PPPs).
In addition, the GFF, which builds on the HRITF that supported most RBF interventions, has been actively supporting the integration of RBF with other health financing functions and broader public finance context at country level. The health financing agenda of the GFF has contributed to improve the sustainability and to prevent distortion of RBF interventions thought: (i) increased used of domestic government resources (ii) joint IDA and IBRD financing (iii) alignment with all additional external financing including (iv) private sector resources.
Finally, the Joint IFC and World Bank Approach to Harnessing the Private Sector in Health (presentation to the World Bank Group Board of director, April 24, 2015) identified joint strategies and approaches on the ground in health insurance.
[Action 6: Design RBF interventions consistent with budget formulation, execution, reporting and procurement. Indicator: % of WB active operations supporting RBF schemes integrated into public financing systems of health care providers. FY15 (baseline): 96% FY16: 96% FY17: 93% FY18 (target): 90%]
An uptake in RBF interventions designed to be consistent with the goal of Action 6 was achieved through the expansion of multi-source financing, strengthened GSG partnerships and collaborations, and increased knowledge curation activities. The portfolio review undertaken in FY17 shows that, between FY15 and FY17, over 90% of RBF schemes supported by the World Bank active operations are consistently "on budget" and are integrated into public financing systems.
Expanded financing sources helped improve the share of "on budget" RBF operations, a proxy for interventions being consistent with country budget processes. It implies the use of country systems and refers to all elements of the expenditure budget cycle from planning to audit. To date, most RBF projects were financed through the Health Results Innovation Trust Fund (HRITF), which required both IDA and grant projects to substantially use country systems, be reflected in the country plans and national budgets, have parliamentary-level endorsement for IDA, use national Treasury mechanisms, follow national procurement guidelines, and be tracked, reported and audited through the country systems.
The knowledge curated by the HF GSG has also highlighted the importance of increasing "on budget" development assistance for health (DAH). At the Second Annual UHC Financing Forum, which focused on efficiency in health, the keynote speech delivered by the HF GSG Global Lead discussed the inefficiency of "off budget" aid and its negative implications for health financing sustainability. In health financing, "off budget" aid creates challenges for lower middle-income countries (LMICs) as they navigate the transition from external aid. Delivering this message with the authority of the HF GSG underscores the importance of planning "on budget" interventions to create sustainable health financing reforms.
Finally, HNP GP has expanded partnerships and collaborations to lead initiatives with the purpose of increasing integration of RBF interventions into country systems. The HF GSG has demonstrated thought leadership in the topic of improving the execution of RBF work and making it sustainable for countries. The team has created a collaboration with the WBG Governance GP to study where and how public financial management (PFM) and health financing good practices may conflict, creating challenges in client countries implementing RBF. The collaboration aims to understand how to accommodate performance based financing initiatives in Treasury systems. In addition, the HNP GP and IFC have been working on a joint approach to incorporate private sector delivery in budgets and use all available tools (e.g., contracting, PPPs) to improve efficiency and value for money, especially as IFC continues to expand activities in the area of private health insurance. These joint initiatives show the HF GSG's commitment to design RBF interventions that lead to sustainable change for client countries.
Because the uptake in new projects through the HRITF has slowed per the design of the HRITF although impact evaluations are continuing, the methodology to determine on budget RBF schemes has been updated for FY17 to accommodate projects with alternative funding sources. The list of RBF portfolio projects was individually reviewed with the respective TTLs to confirm if projects newly active in FY17 are on budget. Due to this transition period, a minor fluctuation in the Action 6 results was seen. There were two RBF projects from FY17 which were off budget, in Mauritania and Burundi. In the case of Mauritania, the RBF program is a pilot. A post-project evaluation will determine whether the RBF will be scaled up, at which point it would be integrated into country budgets and systems. In Burundi, the RBF is supported through a virtual basket, meaning that planning, budgeting and verification/counter verification are done under the leadership of the Ministry of Health and according to a single RBF Manual. Bills or requests are sent to each partner to pay health providers directly. The program is administered off budget to accommodate all donors, which include the EU and several additional countries, as some donors are reluctant to use government channels due to the potentially volatile political contexts. These projects therefore also demonstrate a consistent effort to design interventions that are consistent with country systems whenever possible.
Link between GFF and HRITF:
Over the last decade, RBF - with support of HRITF - has been used to improve service delivery results at the front-lines. Without claiming it is a panacea that fits all contexts, solid evidence exists that well designed and implemented RBF programs can increase service coverage and quality of care in various contexts. While RBF also has the potential to drive system-wide reform through improved accountability, data management, and building capacity in strategic purchasing, it has not yet realized its potential as much as it could. HRITF experience revealed that for RBF to drive sustainable reform, buy-in from key stakeholders, including Ministries of Finance and donors should be sought very early in the process.
The GFF approach has incorporated this lesson learned and explicitly seeks such buy-in by supporting the development and implementation of a Health Financing Strategy that lays out key strategic objectives for the short, medium and long term and bridges discussions on service delivery with sustainable financing.
In Sierra Leone for example, the GFF will be supporting an agenda of capacity building and integration of RBF into a larger health financing context. Since 2011, Sierra Leone has been implementing an RBF scheme as part of the World Bank-supported Reproductive and Child Health Project. The RBF funds that were channeled to primary care facilities have been key to redistribute public resources to the frontline services in rural areas. RBF implementation has not gone without challenges, most notably the payment delays caused by a very high number of contracted facilities. Current funding for RBF implementation has come to an end, but as RBF was the only source of disposable funding at the facility level and therefore important for the effective implementation of the Free Health Care Initiative, there is interest within the government to improve and sustain the RBF approach. At the same time, Sierra Leone has ambitious plans to roll out the Sierra Leone Social Health Insurance Scheme (SLeSHI). Recognizing that RBF can only be sustained if it is considered as an integral part of the overall health financing system, and that SLeSHI will need to build capacity in its function of a strategic purchaser, the GFF is supporting a redesigned RBF pilot while at the same time pursuing an agenda of integration between SLeSHI and RBF. Through continuous engagement and technical support, the GFF is contributing to developing a roadmap that lays out how RBF can lay the foundation for strategic purchasing within SLeSHI.
GFF Health Financing work more generally:
The smart, scaled and sustainable Financing agenda of the GFF is focused on getting more results from existing resources and increasing the total volume of financing from four sources:
- Domestic government resources
- Financing from IDA and IBRD
- Aligned external financing
- Private sector resources
Specifically on domestic resources, the GFF supports governments to get more from existing resources in several ways. The fact that the GFF is hosted by the World Bank Group is critical for this: on a daily basis, World Bank country directors and economists are engaging with ministries of finance on approaches to improving efficiency, and so the GFF has a ready entry point into broader economic policy dialogues. This also affords the GFF a connection with a whole set of experts in public financial management who can be drawn upon to support governments that are not spending all the money that is available to them, which is a major issue in many countries. Another key strategy is to tie financing to results. With GFF support, results-based financing schemes that create incentives to improve the quality of care are being expanded both at the level of service delivery as well as at the regional and national level through the use of DLIs. The GFF also assists countries to improve efficiency by supporting the identification of evidence-based and cost-effective priorities, such as family planning and nutrition. While improving efficiency is a key starting point in many countries, it is in its own rarely sufficient to close the financing gap. The GFF therefore also supports countries to mobilize more resources for health. The tie between the GFF and the World Bank Group is central to this, as by virtue of these links the GFF is well-positioned to inform policy dialogue about overall government financing. The flexible resources from the GFF Trust Fund have been used in a number of countries to support the analytical and preparatory work that is critical for this, and they can also be used more innovatively to encourage countries to allocate additional domestic resources to the health sector. For example, in Guatemala the GFF Trust Fund is supporting a buy-down of an IBRD loan. In exchange the government of Guatemala has agreed to take the savings from the reduced interest payments (an estimated US$9 million), match these with US$9 million in government resources, and invest the total amount in improving the nutritional status and health of the indigenous population. Thus each dollar invested by the GFF Trust Fund in Guatemala is generating two dollars of domestic financing. In Kenya, which has recently decentralized budgetary authority in the health sector to the county level, financing from the GFF Trust Fund and IDA is being used by the national government to incentivize counties to allocate additional resources to the health sector. These approaches are critical to the business model of the GFF: the idea is not to continue to provide grants from the GFF Trust Fund in perpetuity but rather to support countries to reduce their reliance on external assistance and progressively assume responsibility for the financing needed to improve the health of women, children, and adolescents.
WBG has strengthened its focus on integrating health financing functions. Almost all RBF projects follows IDA procedures substantially follows country systems (e.g. is reflected in country plans and national budgets, require parliament endorsement, use of Treasury mechanisms, national procurement guidelines and is tracked, reported, and audited through the country systems). The Joint IFC/World Bank Approach to Harnessing the Private Sector in Health, presented to the WBG Board on April 24, 2015, call for an integrated support to health systems. The HNP GP and IFC are expected to expand joint activities in the area of private health insurance.
The WBG has strengthened focus on integrating health financing functions by supporting results-based financing (RBF) interventions and the broader public finance system at the country level with the aim of enhancing sustainability and preventing distortions and by developing a joint strategic approach between IFC and the HNP GP, which is based on health insurance, including both mandatory and voluntary coverage. The portfolio review shows that the World Bank-supported RBF projects in almost all instances have Trust Fund Grants co-financing IDA and following all procedures as applicable to IDA, i.e., 96% of WB active operations support RBF schemes integrated into public financing systems of health care providers in FY15 and FY16. "Aid on Budget" implies the use of country systems and refers to all elements of the expenditure budget cycle from planning to audit. Financing of RBF Projects (IDA and Grant) substantially follows country systems and is reflected in country plans and national budgets, has parliament endorsement for IDA, uses Treasury mechanisms, follows national procurement guidelines and is tracked, reported, and audited through the country systems. Thus RBF projects (IDA and Grant) are largely on budget and their implementation includes use of country systems. The HNP GP has been intentionally supporting this trend through complementary initiatives to ensure the integration of RBF interventions into country systems. The Joint IFC/World Bank Approach to Harnessing the Private Sector in Health, presented to the WBG Board on April 24, 2015, calls for an integrated health system approach that looks for the best solutions, regardless of whether they are public or private. Regarding public health financing, it recommends an approach to incorporate private sector delivery and use all available appropriate tools (e.g. contracting, PPPs, etc.) to improve efficiency/value for money. The HNP GP and IFC are continuing to work on the WBG joint approach, especially as IFC works to expand activities in the area of private health insurance.
[Action 6: Design RBF interventions consistent with budget formulation, execution, reporting and procurement. Indicator: % of WB active operations supporting RBF schemes integrated into public financing systems of health care providers. FY15 (baseline): 96% FY16: 96% FY18 (target): 90%]
The Global Practice reports that it is starting the process of integrating health financing into country systems and moving away from ad hoc approaches. This will involve, among other steps, the incorporation of lessons from current Result-Based Financing initiatives into new schemes. This work is laying the groundwork for concrete steps to implement the recommendation. The Global Practice has not set the baseline or targets for this indicator.
The HNP GP has taken several steps to ensure, where appropriate, the integration of RBF interventions into country systems. Most importantly, the GFF (see above), which builds on the $1 billion HRITF that supports most WBG RBF interventions and is now coming to an end (all funds are committed), promotes a 'smart-financing' approach, including RBF elements integrated into country systems. In addition, the HNP GP:
1. Plans a comprehensive review of the lessons emerging from the HRITF-supported RBF-interventions to support the design and implementation of future approaches.
2. Started work toward an enhanced peer review process to strengthen and better align ASA / operations with GP and corporate priorities, such as integrated RBF approaches.
The review of operations active in FY15 is ongoing, hence, baselines and targets for the performance indicator are missing.