The impact of performance-based financing within local health systems: Evidence from Mozambique

Most evidence on Performance Based Financing (PBF) in low-income settings has focused on services delivered by providers in targeted health administrations, with limited understanding of how effects on health and care vary within them. We evaluated the population effects of a program implemented in two provinces in Mozambique, focusing on child, maternal and HIV/AIDS care and knowledge. We used a difference-in-difference estimation strategy applied to data on mothers from the Demographic Health Surveys, linked to information on their closest health facility. The impact of PBF was limited. HIV testing during antenatal care increased, particularly for women who were wealthier, more educated, or residing in Gaza Province. Knowledge about transmission of HIV from mother-to-child, and its prevention, increased, particularly for women who were less wealthy, less educated, or residing in Nampula Province. Exploiting the roll-out by facility, we found that the effects were concentrated on less wealthy and less educated women, whose closest facility was in the referral network of a PBF facility. Results suggest that HIV testing and knowledge promotion increased in the whole district, as a strategy to boost referral for highly incentivized HIV services delivered in PBF facilities. However, demand-side constraints may prevent the use of those services.