Effect of Performance-Based Financing on Health Service Delivery: A Case Study from Adamawa State, Nigeria

Ryoko Sato, Harvard School of Public Health
Abdullahi Belel, Independent

Nigeria lags behind other African countries in terms of health outcome indicators, despite economic advantages. The poor health outcome indicators might be attributed to the poor service delivery. This paper evaluates the experimental effect of Performance-Based Financing (PBF), which was randomly introduced to some Local Government Areas (LGA) in Adamawa state (northeastern), on service deliver indictors. We use Difference-in-Differences (DiD) to evaluate the effect of PBF on seven health service delivery indicators in Adamawa state. We find that PBF is highly effective in increasing the quantity of most of health service delivery indicators. However, PBF did not have any impact on the quantity of full vaccination and postnatal care provided. Suggestive evidence shows that this insignificant effect is not due to the low unit price nor due to the high baseline rate. Future work should explore why PBF influenced some service delivery but not others.