Core components of financing

  • Countries that improve financing in their health system may achieve the following outcomes and impact:

    • Financial protection: PHC services funded with public funds help to minimize cost-sharing and prevent catastrophic spending for beneficiaries
    • Effective resource allocation and responsiveness to population health needs: well-designed purchasing arrangements and resource allocation strategies can enable health systems to better direct resources towards providers and services in response to a population’s health needs
    • Accessibility, quality, & efficiency of care: financing impacts the entire health system’s performance, including the accessibility, quality, and efficiency of primary health care. For example, financial protection mechanisms help protect patients from catastrophic health spending and strategic purchasing arrangements can incentivize the delivery of better quality services.
  • Key principles to follow:

    • Prioritize effectively: funds should be allocated to priority services and populations that are at the greatest risk in the health system. It is important not only to establish priorities for where funds should be allocated, but to ensure leaders and policymakers are clear and aligned on a country’s funding priorities to ensure resources are properly allocated and accountability is enforced. Performance budgeting, for example, is a great way to ensure funds are making it to the services and populations that have been prioritized.
    • Invest in high-quality providers: It’s important to purchase services from providers who are confident in their ability to deliver high-quality care at the right level of the system. When identifying providers, services and interventions to purchase, it’s critical to take into account population health needs, cost-effectiveness as well as national health priorities. When it comes to investing the funds allocated for health care, it is critical that these funds are being put towards providers and services that will best serve the health system and work towards improvement in care delivery. For example, utilizing a program-based budget system as opposed to a line item system to show what kinds of improvements and positive outcomes have resulted from the use of the money instead of simply spending money on approved inputs.
    • Design/select effective incentive structures: choose and design incentive systems that enable high-quality PHC and financial protection. For example, incentives should reflect the goals and values of a PHC-oriented health system and motivate, encourage, and capacitate providers to perform well. It is also important that these incentives are aligned and coordinated with one another to ensure consistency across the health system and to minimize any perverse incentives that may result in poor service quality. 
    • Promote provider autonomy: promoting provider autonomy is critical for high-quality primary care. Giving providers autonomy helps to hold them accountable for their performance and the effective use of funds. For example, when providers are given the opportunity and autonomy to invest in improving their health facilities, this creates a motivation to perform well and work towards delivering high-quality care.


PHCPI is a partnership dedicated to transforming the global state of primary health care, beginning with better measurement. While the content in this report represents the position of the partnership as a whole, it does not necessarily reflect the official policy or position of any individual partner organization.