Process guide for identifying issues and fostering dialogue to align public financial management and health financing systems
Making progress towards universal health coverage (UHC) requires a predominant reliance on stable, public revenue sources, spent in a way which promotes health system goals. The public financial management (PFM) systems, through which these resources flow, needs to ensure that funds are used effectively and efficiently, by directing them towards what are often variable and uncertain population health needs and priorities.
Strong PFM systems are critical to ensuring higher and more predictable budget allocations, reduced fragmentation in revenue streams and funding flows, timely budget execution, and better financial accountability and transparency. However, the health sector faces specific challenges that require more flexibility than PFM systems typically offer, which can result in a misalignment between the way funds can be used and health system objectives.
This guide lays out an illustrative process for health and finance authorities to engage in productive dialogue, assess the current situation in terms of how aligned the PFM system and health financing system are, and work towards a joint policy roadmap to improve alignment. It builds on a previous document “Aligning public financial management and health financing: sustaining progress toward universal health coverage,” which considers how PFM and health financing systems can be better aligned in support of UHC, and provides a framework to examine common challenges, as well as offering strategies to address them. This guide can serve as an entry point for that dialogue, and can facilitate a structured approach for health, finance and other stakeholders to discuss underlying issues before implementing system changes that might affect the PFM and health financing system.
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- Public financial management
- Purchasing and provider payment systems
- Revenue raising
- Sustainable financing for UHC