Launching Pay for Performance in Ethiopia: Challenges and Lessons Learned

Ethiopia’s Federal Ministry of Health designed a pay-for-performance (P4P) scheme that has not been implemented. It was intended to improve health care quality and utilization, and thereby the health outcome indicators associated with maternal and child health, family planning, HIV/AIDS, tuberculosis, and malaria, as well as with strengthening the health system. An implementation guide outlines multiple aspects of the P4P scheme such as qualitative and quantitative indicators of care delivery that health workers and health facilities must meet in order to earn financial and nonfinancial awards. Moving from design to implementation is challenged by misalignment with nationwide civil service reforms. In describing Ethiopia’s experience, the case study provides an example of the design of a broad public sector P4P approach that incorporates intergovernmental transfers in a decentralized context with rewards for concrete health results at the facility level and the challenges of moving from design to implementation.

From the Health System 20/20 P4P case study series, which profiles maternal and child health-oriented P4P programs in countries in Africa, Asia, and the Americas, and is intended to help those countries and donors already engaged in P4P to fine-tune their programs and those that are contemplating P4P to adopt such a program as part of their efforts to strengthen their health system and improve health outcomes.