Over the last decade, a significant reduction of maternal and child mortality has been achieved in low- and middle-income countries (LMICs). This is largely attributable to the substantial improvement in access to essential reproductive, maternal and child health services. However, in some countries, expansion of health services has not resulted in the expected mortality reduction. Low quality of care (QoC) is an important cause of this discrepancy, and it calls for putting quality improvement on the global health agenda. As an approach to enhance QoC in LMICs, performance-based financing (PBF), which incentivizes health providers based on predetermined indicators, has been piloted or implemented in more than 30 countries. More importantly, PBF has been used as an important vehicle to catalyze health system reforms to enhance service delivery, including quality improvement (QI), in many countries.

This paper takes a system perspective to examine the current practice of PBF in strengthening health systems for QI, and provides insights for future PBF implementation. This is of particular importance in the era when countries endeavor to progress towards Universal Health Coverage (UHC) and achieve Sustainable Development Goal (SDG) 3 ensuring “healthy lives and promote well-being for all and at all ages.”