A new study in Tanzania shows that making regular and timely bonus payments to health facilities can improve maternal and child health services in the country. The funds help clinics buy essential medicines, keep staff motivated, and improve the quality of services.

Published in the Social Science & Medicine recently, the study focused on Payment for Performance (P4P)—a programme where health workers and clinics receive bonus funds when they meet specific targets, such as providing malaria medicine during pregnancy or encouraging safe deliveries in health centres.

More about the P4P

P4P has been implemented in many low- and middle-income countries (LMICs) to improve the quality and coverage of maternal and child health services. It encourages achievement of pre-defined indicators through the provision of incentives to health workers and managers for performance attained

Researchers used a system dynamics model to simulate how the design and implementation of P4P programmes shape health outcomes in primary care. The model tested different scenarios, including delays in bonus payments, allocation of funds, and the impact of community context.

Why timely payments matter

The study found that when payments arrived on time, health workers felt motivated and trusted the programme. Facilities also used the funds to stock up on important medicines, which in turn improved the quality of care and encouraged more women to seek care at health facilities. However, when payments were delayed the opposite happened: medicine shortages increased, staff lost motivation, and confidence in the programme weakened

How the money is used matters

The study also found that how the money is spent makes a big difference. Funding for facility operations—such as drug supplies—was identified as a critical factor in success. When more funds were directed to purchasing medicines, performance improved sharply for antenatal care services, especially the delivery of preventive malaria treatment for pregnant women.

By contrast, targets such as increasing the number of safe births in health facilities were less dependent on medicines. Here, community awareness and outreach activities mattered more.

Local context matters

The analysis showed that P4P schemes worked best when drugs were already fairly available from medical stores, when communities were aware of the services, and when facilities served populations that were not too far or dispersed.

The study also revealed that programme effects change over time, rising and falling in response to wider system challenges—something that one-off evaluations often fail to capture.

What this means for the future

Globally, many countries are moving from P4P schemes towards Direct Health Facility Financing (DHFF), which gives health providers more control over how to use funds. The researchers say this approach could be more effective, emphasizing that allowing facilities to spend more on essential operations brings the biggest improvements in service quality.

“Study results indicated that this funding design would have greatest improvement on content of care services… Effectual implementation of the programme, specifically timely bonus payments, will strengthen pathways to impact for the programme to improve healthcare service delivery outcomes.”

However, they warn that predictable funding and timely payments remain essential. “If facilities can’t rely on funds arriving, the whole system suffers—trust is lost, medicines run out, and health outcomes decline,” the authors cautioned.

Ifakara plays key role in the study

Dr. Peter Binyaruka and John Maiba from Ifakara Health Institute made significant contributions to the study, alongside international partners. The lead author was Rachel Cassidy from the London School of Hygiene and Tropical Medicine (LSHTM). Other contributors included Agnes Rwashana Semwanga from Makerere University, Karl Blanchet from the University of Geneva, and Neha Singh and Josephine Borghi also from LSHTM.

Read the publication here.