Global Health Policy Research Network

Rena Eichler and Ruth Levine, lead co-authors of the newly released book, Performance Incentives for Global Health: Potential and Pitfalls, respond to questions about the study. Q: What are performance incentives? Eichler: There are many ways of using rewards to improve outcomes at different levels of the health system. We studied a specific form of performance incentives, in which money or goods are given to patients or providers when they take health-related actions or achieve set targets. For example, cash or food may be given to parents for having their children immunized or attending nutrition classes, or to patients for getting tested for communicable diseases, or adhering to TB or AIDS treatment. Financial incentives also may be paid to service providers or networks of facilities for attaining targets in the quantity and quality of services provided. These incentives usually represent a small portion of total health spending—a few percentage points—and don’t substitute for the resources required to build infrastructure, train health workers, and strengthen basic systems. As a complement to those sorts of investments, though, performance incentives can be a bit of grease in the wheels to make the health system work more smoothly. Q: What’s new about this idea? Levine: In some sense, it’s a very old idea. We certainly see the idea of rewarding “good” behavior from antiquity—in fact, one colleague pointed out that there was mention of incentives in the Hammurabi Code from the 18th century BC! The application in a systematic way in the health sector, though, is relatively new, and it’s an emerging trend in both high-income settings, such as the U.S. and the UK, and in developing countries. For donors who work in the health sector, it’s a promising approach to get more health out of their health care spending. We think it may be especially useful in cases where new funding has become available to address high-priority health problems. Q: Why should people be paid more to do the right thing? Eichler: Performance incentives can help to overcome barriers that prevent people—patients and providers—from “doing the right thing.” Demand-side incentives—those offered to parents of young children or to adult patients themselves—are a form of positive reinforcement, spurring people to make the effort to seek care, complete a course of treatment, or modify their eating or other behavior. Supply-side incentives—those offered to healthcare providers—can help to overcome problems in the existing incentive environment where, for example, people may be paid whether or not they come to work regularly, and whether or not they are responsive to the needs of the community. I don’t think performance incentives work when they are used to get people to do things they are not intrinsically motivated to do; but I do think they can provide that extra kick to make it more likely than it otherwise would be for people to act on their positive motivations. Q: Why did you do this project now? Levine: NGOs, donors, and governments in low- and middle-income countries, are seeking ways to improve the way health systems function and to achieve ambitious goals for health improvement. When we look across strategies to do that, one of the most promising innovations being explored is the introduction of performance incentives. There are compelling conceptual reasons to believe that part of the underuse of health services, shortcomings in adherence to drug regimens, poor quality of services, and other problems are due to a dysfunctional environment, as well as there being too few resources in absolute terms. Paying for performance can help to align the behavior of patients and health workers to achieve better health outcomes. There are also some important real-world experiences that demonstrate both the potential to see dramatic improvements when incentives are introduced, as well as some of the ways in which problems can occur. We thought the time was right to take a close look and lay out in clear and specific language the why, what, and how of performance incentives, as a contribution to the sometimes very vague discussions of “health system strengthening.” Q: Performance incentives are about tinkering with people’s behaviors. Can they ever go wrong? Eichler: Incentives can be very powerful, so it’s very important to design and implement them in ways that can help to avoid unintended consequences. The problems to be most concerned about are misreporting, undermining the intrinsic motivations of health workers, and inducing health workers to neglect services that are not being rewarded. When funded by donors, there are also the standard issues with any donor-supported health program, such as consistency with the overall direction of health policies and priorities, and sustainable funding. Q: What do you hope will come out of this work? Levine: No one thinks the answer to every problem in every country will be to use performance incentives. Our modest hope for this book, though, is that as developing-country governments, NGOs, and donor partners make choices about investing in health systems or in disease-specific programs, they will first analyze the existing incentive environment to look at supply- and demand-side barriers and, second, consider whether there is a place for performance incentives. If the choice is made to go ahead with an incentive program, then the experiences documented in this book and the lessons about design and implementation can help to get things started successfully.

Access the full Working Group report: Challenges and Opportunities for the New Executive Director of the Global Fund: Seven Essential Tasks (pdf) Rapport plein en Français (pdf) Reporte completo en Espanol (pdf) In its first four years, the Global Fund to Fight AIDS, Tuberculosis and Malaria has quickly become one of the most important aid agencies in the world. It has approved over 360 grant programs in 132 countries valued at $5.6 billion, and it has disbursed over $2.7 billion. Next week the Fund will select a new Executive Director (ED). CGD senior fellow Steve Radelet chaired a working group to identify key challenges for the Fund ahead of the selection. He explains the purpose and scope of the forthcoming report, which will be released on October 26th. Q: What is the purpose of the Global Fund? A: The Fund was created to substantially increase funding for programs aimed at fighting HIV/AIDS, TB and malaria in countries around the world. These diseases needlessly kill more than 16,000 people every day. Until the founding of the Global Fund and the launch of other programs in recent years -- like the U.S. President's Emergency Plan for AIDS Relief (PEPFAR) -- the international community had done shockingly little to respond to the crisis. The Fund is a foundation -- not a U.N. agency or a broader development agency -- and as such it acts primarily as a financing mechanism, rather than an implementing agency or a clearinghouse for technical assistance. It works in cooperation with other groups -- multilateral organizations, bilateral agencies, NGOS, civil society and faith based groups -- that help design programs, provide technical assistance, and otherwise provide support for country programs. Q: The Global Fund seems to operate differently from many other organizations. How is it structured? A: The Fund is really quite an unusual organization. It is governed by a 24 member Board of Directors consisting of donor governments, recipient governments, people living with the diseases, NGO representatives from both donor and recipient governments, the Bill & Melinda Gates Foundation (its largest non-government donor), and private sector representatives. The ED manages a very small Secretariat: just 240 staff, all based in Geneva, overseeing 360 grants, making it one of the leanest of all major international organizations. In recipient countries, overall responsibility falls with a Country Coordinating Mechanism (CCM), a group whose composition in some ways mirrors the Board: government officials, NGOs, civil society and faith based groups, and multilateral and bilateral representatives. The CCM is responsible for designing programs, submitting grant proposals to the Global Fund, and picking one or more organizations to implement programs. The Fund takes very seriously -- much more seriously than most organizations -- the ideas of country ownership, broad participation in key decisions, and transparency. Its focus on these principles, along with striving for accountability in results and low administrative costs, sets the Fund apart, but also leads to some of the key challenges and tensions we describe in our report. Q: What impact has it had so far? A: As of June 2006, its grants were supporting antiretroviral (ARV) treatment for 544,000 people living with HIV; testing and counselling for HIV for 5.7 million people; directly observed treatment short course (DOTS) for 1.4 million people with TB; and 11.3 million insecticide-treated bed nets for malaria prevention. These are the numbers of people already being reached -- the targets for current programs are even higher. People associate the Global Fund mostly with HIV/AIDS, but it is crucial to remember that it funds programs in all three diseases, and proportionally on a global scale it makes even bigger contributions to TB and malaria. Currently the Fund provides two-thirds of global donor funding for malaria, 45 percent for TB programs, and about 20 percent for HIV/AIDS, numbers I find impressive for a four-year-old organization. With grants disbursing in 128 countries, the Fund's global reach is broader than any organization outside of the United Nations. This is a very tall order, and while the Fund has made commendable progress, it faces some significant challenges as well. Q: What are some of the biggest challenges? A: Well, with 360 grant programs in 128 countries, you're bound to get some programs that work well and others where there are concerns. In some countries the CCM process works fine, but in others there are concerns about who is included and who is excluded, government domination over NGOs, and the quality of CCM oversight. The ideals of broad participation and country ownership -- which many donors don't even attempt -- are very hard to put into practice in many countries. And as with any broadly participatory process -- like democracy -- the process is sometimes slow and not as decisive as it could be. But the process helps build legitimacy, create some buy-in, and build capacity over time. A huge challenge is that when the international community designed the Global Fund to be primarily a financing mechanism, they assumed that others would be able to step up and provide countries with other support needed to make programs work, such as technical assistance, on-the-ground monitoring, and other inputs. But this hasn't always happened, and country capacity to absorb funds and implement programs was more of a constraint that many foresaw. Building strong capacity in countries that will allow them to implement effective programs over the long term is an enormous challenge. Going forward there will need to be much greater cooperation across agencies, and stronger support for other organizations to allow them to ramp up technical assistance and other support to countries facing major capacity constraints. The Fund also faces the big challenge of how to ensure results. From the outset, the Fund has tried to emphasize performance-based funding, but as other organizations have found out, this is not easy. Just determining what to actually measure and collecting the data is far from easy, and figuring out how to independently monitor progress on the ground is a major challenge. And once problems are detected, it is not straightforward to determine when the best course of action is to try to reprogram or refocus the grant, or to cut off funding and redirect it another country where it might be more effective. Some of the biggest debates around the Fund in the last year have been whether or not to cut off funding to a small number of poorly performing grants, and these debates are unlikely to be any easier in the future. Q: What about funding? A: This is a big concern, and not just for the Global Fund. Although world-wide funding has increased significantly in recent years, the diseases are continuing to spread, and all estimates for global needs show a sharp escalation in coming years. According to estimates from UNAIDS, Roll Back Malaria, and the Stop TB Partnership, global needs to effectively fight the three diseases already top $20 billion annually and are increasing steadily. Obviously the Global Fund doesn't have to fund all of that, or even necessarily be the largest funder. But to effectively address the three diseases, the Fund faces two major challenges. First, it must significantly ramp up its contributions from traditional and non-traditional donors and the private sector to meet these growing needs. Second, since even with increased funding its resources will always be less than needs, it must determine how best to allocate its funds and manage it grants across countries to ensure maximum impact and have the greatest possible impact on the diseases. Q: How is the new ED being chosen? A: The Global Fund Board created a Nomination Committee in April 2006, which, among other steps, hired an Executive Search firm to help in the process. In all, 334 people applied for the position. The Nomination Committee, through several rounds of consideration, has narrowed the list to five finalists: Hilde Johnson (Norway), Michel Kazatchkine (France), Congressman Jim Kolbe (U.S.), Bill Roedy (U.S.), and Michel Sidibe (Mali). The Board is now interviewing the five candidates via teleconference. At its next Board meeting on October 31st in Guatemala City, the Board will make its decision and choose the new ED. Assuming all the arrangements can be put in place, the new ED will start very early in 2007. Q: The working group you chaired offered several recommendations for the new director. Can you tell us, in advance of the release of the report on Thursday, some of the most important issues it examines? A: We identified seven key tasks for the new ED to focus attention, ranging from strengthening in-country operations, ramping up efforts for more effective technical assistance, strengthening procurement and supply chain management systems, and improving relationships between the Board and the ED, which have not always been smooth. For each task, we make several specific recommendations. Some recommendations are very specific and seem small, but can have big impacts, such as the Secretariat quickly distributing information it picks up in its Early Warning System to a wide range of interested parties -- multilateral organizations, bilateral agencies, NGO groups, as well as host governments -- so that steps can be taken rapidly to address weak programs. Some recommendations will require much greater cooperation with other organizations, since the Global Fund by design must work together with other agencies to support country programs. Thus we recommend establishing a "Heads of Agencies Group" in which the heads of the Global Fund, UNAIDS, WHO and the World Bank (and perhaps a very small number of others) would meet regularly to work out at the highest levels key strategies for jointly addressing technical assistance, global procurement, program monitoring and other issues. In terms of the Secretariat, we recommend the new ED commission a management audit of the Secretariat to help determine its optimal size and staffing patterns, and focus particularly on steps to strengthen the work of the Fund Portfolio Mangers that support each grant. We also recommend that the Secretariat add to its staff a full-time, professional, fundraising team. And although our focus in on the ED, we make a few recommendations to the Board in how it can help the ED succeed. In particular, we recommend that Board make the ED a non-voting member of the Board to help strengthen communications and improve Board decisions. The new ED joins the Global Fund at a critical time as it shifts from an innovative start-up to a mature organization. The next two years will have a tremendous impact on defining the future role and sustainability of the Fund and its long-term impact in fighting the three diseases. It is our hope that this report helps the new ED to better understand the key issues facing the Fund and some of the most important steps that can be taken to make the Fund even more effective in fighting HIV/AIDS, TB and malaria.

The increased availability of life-saving medicines worldwide is having a serious unintended side-effect: a wide array of diseases -- from malaria, TB and HIV/AIDS to pneumonia and acute diarrhea -- is becoming resistant to the drugs we rely on to overcome them. To address this critical challenge, the Center for Global Development organized the Drug Resistance Working Group late last year to discover ways that the international community can prevent or contain the emergence of drug resistance in developing countries. Rachel Nugent, CGD senior program associate for global health, chairs the group. In this Q&A, she explains the group’s goals and the main points of its recently released concept paper, Drug Resistance as a Global Health Policy Priority. Q: Developing countries already face many technical and financial challenges in meeting the health-care needs of their people. Why does CGD see drug resistance as a major issue? A: Over the long term, much of the health care progress in developing countries may be for naught if we can’t overcome drug resistance. In the United States, it costs several thousand dollars extra to treat an infection that is resistant to common antimicrobials; hospital-acquired infections alone are estimated to cost $17-$29 billion per year. But the cost of improper management of medicines and health care in the developing world will be measured not only in terms of wasted money but also in lives needlessly lost. Resistance has arisen against all major drugs for treating Malaria and TB -- sometimes making them untreatable. Resistance is growing rapidly to antibiotics for Staph and Strep, and for common diarrheal and respiratory infections. Resistance to drugs for treating AIDS is beginning to emerge in developing countries where treatment has been available, and it is expected to grow as treatment expands. It also limits treatment options for serious illnesses such as respiratory infections. Q: What are the causes of drug resistance? A: The past 50 years have been a golden age for human dominance over microbes. Since the discovery of penicillin in the mid-20th century, antibiotics -- and more recently antivirals (and antiretrovirals) -- have been a mainstay of the public health arsenal deployed against communicable disease, alongside vaccines. But over time, genetic mutations have occurred, rendering microbes less susceptible to these drugs, and resistant microbes are being passed from host to host. The resistance of pathogens to drugs is a naturally occurring biological phenomenon, but the process may be stimulated or accelerated in response to human actions, which may in turn stem from health system weaknesses. The challenge presented by these conditions has become more apparent with the increasing burden of disease and greater resources dedicated to treatment. Q: How will the working group tackle this problem? A: Our work will be conducted in several stages. Beginning with an initial mapping of the resistance problem, we plan to describe the patterns, causes, and key characteristics of resistance to illuminate the global aspects of the issue. Second, we will analyze the costs of drug resistance at different levels of society and how they might change under different scenarios. From that work, we hope to develop models of action for public and private donors and international organizations that could create incentives to slow drug resistance. Ultimately, we hope our efforts will identify informational and regulatory actions to reduce the risk of resistance. The main product of the working group will be a policy report identifying practical actions. The report, which we hope to release by the end of this year, will include recommendations for the global donor community. It will outline the responsibilities different actors should bear while pointing out opportunities and needs at the local, national, and intra-institutional levels. Q: Who are the members of the working group? A: Like many other development issues, drug resistance requires a coordinated response from a wide variety of policymakers and experts. CGD has been very fortunate to recruit more than 30 talented individuals who will contribute their experience and insight to tackle a complex problem with truly global implications. Because this issue requires action on a number of different fronts, our working group has experts from the public health sectors in developing and developed countries, technical and funding agencies, product development partnerships, the pharmaceutical industry, advocacy organizations and academia. All of these individuals work in communities that have an interest in this issue, but rarely have an opportunity to forge joint solutions. We are especially fortunate to have a number of working group members from developing countries who are dealing with this problem every day, and can provide essential knowledge about what responses are needed to support effective health improvements in different developing country settings. (You can see a list of the working group members here).