The effect of performance-based financing on illness, care-seeking and treatment among children: an impact evaluation in Rwanda

BACKGROUND Performance-based financing (PBF) strategies are promoted as a supply-side, results-based financing mechanism to improve primary health care. This study estimated the effects of Rwanda's PBF program on less-incentivized child health services and examined the differential program impact by household poverty. METHODS Districts were allocated to intervention and comparison for PBF implementation in Rwanda. Using Demographic Health Survey data from 2005 to 2007-08, a community-level panel dataset of 5781 children less than 5 years of age from intervention and comparison districts was created. The impacts of PBF on reported childhood illness, facility care-seeking, and treatment received were estimated using a difference-in-differences model with community fixed effects. An interaction term between poverty and the program was estimated to identify the differential effect of PBF among children from poorer families. RESULTS There was no measurable difference in estimated probability of reporting illness with diarrhea, fever or acute respiratory infections between the intervention and comparison groups. Seeking care at a facility for these illnesses increased over time, however no differential effect by PBF was seen. The estimated effect of PBF on receipt of treatment for poor children is 45 percentage points higher (p = 0.047) compared to the non-poor children seeking care for diarrhea or fever. CONCLUSIONS PBF, a supply-side incentive program, improved the quality of treatment received by poor children conditional on patients seeking care, but it did not impact the propensity to seek care. These findings provide additional evidence that PBF incentivizes the critical role staff play in assuring quality services, but does little to influence consumer demand for these services. Efforts to improve child health need to address both supply and demand, with additional attention to barriers due to poverty if equity in service use is a concern.