Performance-based financing: just a donor fad or a catalyst towards comprehensive health-care reform

The United Nations Millennium Development Goals are approaching their deadline of 2015 but progress to date has been insufficient. Public expenditure on health – both domestic and official development assistance – has increased over the past few years in most low-income countries1 but results have been slow. As the public health system remains the backbone of national health policy and the main beneficiary of international aid, it is most likely to be part of the problem. In too many countries, the public health system does not meet user needs and demands.2 It is inefficient due to resource leakage3 and worker absenteeism.4 Equity, in terms of utilization and contribution, is unsatisfactory and public spending often benefits richer groups disproportionately.5,6 Ministries of health and their international advocates often cite insufficient funding as the underlying cause of low performance. Others argue that it also stems from a lack of accountability within public health systems.7 Although many observers and users are likely to share this view, few proposals for reform have been put forward. Our opinion is that performance-based financing, as it is being developed in several sub-Saharan African countries, is a strategy that could help address the structural problems plaguing health systems.