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Entrepreneurship as working mechanism of performance based financing - A case study to the diffusion of strategies in Rwandan health centers

Jong, D.L.K. de (2012) Entrepreneurship as working mechanism of performance based financing - A case study to the diffusion of strategies in Rwandan health centers.

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Abstract:Among different payment mechanisms for health care, there is one mechanism that provides an incentive for health output: performance-based financing (PBF). By financing desired outputs the interests of the health care provider can be aligned with interests of policy makers. For low and middle-income countries this mechanism can be an opportunity to increase policy effectiveness. Most importantly, PBF may contribute to reach the millennium development goals (MDGs) by aligning interests. Second, problems in the supply of health care to the population can be overcome: health care staff becomes eager to treat more people and provide better care when financing them on output. Indeed, PBF is rapidly gaining popularity in the low and middle-income countries. Rwanda has been the first low-income country where PBF has been introduced nationwide. The introduced PBF program was an addition to existing health care financing. With the PBF program health centers receive bonuses for improving quantity and quality of care, based on various indicators. After nongovernmental organizations (NGOs) performed small trials in 2002-2005, the government has introduced PBF countrywide in 2006-2008. To enable research, the countrywide implementation of PBF was divided in two phases. In half of the (non-trial) regions PBF has been implemented in 2006 (phase 1), in the other half PBF has been introduced in 2007-2008 (phase 2). Thus, together with the trial regions (phase 0), there are three implementation phases. With the phase-wise introduction, the research of Basinga et al., (2011) has demonstrated effectiveness of PBF in Rwanda, mainly in terms of increased delivery of health care for pregnant women. The majority of studies to PBF focus on the effectiveness of PBF. Studies to the working mechanisms of PBF are very limited. Hence, it is unknown which of the many possible working mechanisms result in the effects of PBF. Even while studies to the working mechanisms are important for assessing longterm effectiveness, potential pitfalls of PBF and prediction of effectiveness for other countries. In this research the relation of entrepreneurship of the health centers with PBF is assessed. Likely, there is an interaction between the two. One, PBF may affect the degree of entrepreneurship and two, the entrepreneurship may contribute to the effectiveness of PBF. First, the effect of PBF on the entrepreneurialism of health centers is evaluated. For this, the emergence of strategies to increase and improve the provided health care is studied. Second, the importance of the entrepreneurialism as working mechanism of PBF is assessed. It is studied how these strategies diffuse over Rwanda and what are important characteristics to influence this diffusion. The quicker the diffusion, the more likely the entrepreneurialism is important for PBF. To study the diffusion of strategies, geographical aspects of the diffusion of innovation framework are applied. Roughly there are two modes of spatial diffusion, which together can describe most spatial diffusion patterns. These are hierarchical diffusion and contagious diffusion. The hierarchical diffusion is first the spread between actors high in hierarchy and from there to actors lower in hierarchy. With contagious diffusion this hierarchy plays no role, it spreads like an oil stain. The framework of diffusion of innovation is also used to assess the characteristics that may influence the diffusion and adoption of the strategies. Four main components which play a role in the adoption of strategies can be distinguished. First, there are attributes of the strategy itself. Characteristics of the adopter are the second component. Third are the communication channels which are used for dissemination and valuation of the strategy. The last component is the context in which the diffusion process has a place. The research performed as explained in the next sections aims to answer what role entrepreneurialism can have in a PBF system. Moreover, important elements in diffusion and adoption will be determined. With this, more clarity on possible long-term effects of PBF can be given, both for Rwanda as for other countries.
Item Type:Essay (Master)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:83 economics
Programme:Health Sciences MSc (66851)
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