Background Results-based financing (RBF) refers to the transfer of money or material goods conditional on taking a measurable action or achieving a predetermined performance target. RBF is being promoted for helping to achieve the Millennium Development Goals (MDGs).
Methods We undertook a critical appraisal of selected evaluations of RBF schemes in the health sector in low and middle-income countries (LMIC). In addition, key informants were interviewed to identify literature relevant to the use of RBF in the health sector in LMIC, key examples, evaluations, and other key informants.
Results The use of RBF in LMIC has commonly been a part of a package that may include increased funding, technical support, training, changes in management, and new information systems. It is not possible to disentangle the effects of financial incentives as one element of RBF schemes, and there is very limited evidence of RBF per se having an effect. RBF schemes can have unintended effects.
Conclusion When RBF schemes are used, they should be designed carefully, including the level at which they are targeted, the choice of targets and indicators, the type and magnitude of incentives, the proportion of financing that is paid based on results, and the ancillary components of the scheme. For RBF to be effective, it must be part of an appropriate package of interventions, and technical capacity or support must be available. RBF schemes should be monitored for possible unintended effects and evaluated using rigorous study designs.