The Health Systems 20/20 project (HS 20/20) is a Leader with Associates Cooperative Agreement awarded by the U.S. Agency for International Development's (USAID) Global Health Bureau (GBH) for the period September 30, 2006 to September 29, 2011. The goal of HS 20/20 is to increase the use of priority population, health, and nutrition (PHN) services, especially by the disadvantaged. Towards this goal, it implements activities to improve health system performance in four key areas (1) health financing, (2) governance, (3) operations, and (4) local capacity. The project team brings together an exceptional pool of professionals with depth and experience in the project's results areas plus significant field presence and experience to link health system improvements to increased service access and use. Health system strengthening related to HIV/AIDS is a key element of the Partnership Framework (PF). HS20/20's has a commitment to country ownership and the development of local capacity in order to ensure sustainability of activities initiated under the agreement. Furthermore, HS 20/20 is dedicated to improving governance and financial management of HIV/AIDS related activities, two important components of the (PF). The HS 20/20 vision for both strengthening health systems and making them more efficient over time

relies on the project's success in its core intervention areas, which include strengthening of financial systems, operations, and governance and building capacity. The project's results framework calls for improvements in these areas. At its onset, HS 20/20 drafted a set of program indicators to benchmark its performance. These will be applied to each of the activities proposed for Malawi in order to both monitor and evaluate performance and create opportunities for learning. In addition, HS 20/20 will partner with MOH to collect information on the 2010 PFIP core indicator activities and report on targets that have been met. The data quality for program monitoring will be ensured through data validation exercises undertaken in conjunction with our implementing partners in MOH and USG staff. HS20/20 will also strengthen data feedback loops and dissemination mechanisms by working with our implementing partners in MOH to share infrastructure strengthening policies and health finance information widely among stakeholders as well as district, regional, and national level health system administrators and managers. In FY10, HS 20/20 will support the Government of Malawi to conduct a National Health Accounts exercise, building on the results of a NASA exercise in 2009 supported by UNAIDS and a district health expenditure patterns study supported by UNICEF. It is anticipated that the full NHA will be financially supported not only by the USG through the HS 20/20 mechanism, but also by other donors is Malawi. The NHA will include sub-accounts for HIV, malaria, child health, and reproductive health. HS 20/20 will receive USG funding to support these activities from PEPFAR as well as from other non-PEPFAR sources (e.g. PMI, reproductive health, and child survival resources) In FY11, the focus of activities will be to provide technical assistance to help Malawi build upon the NHA, institutionalize the process, and utilize the findings to improve national policies and systems. HS 20/20 will also provide technical assistance to Malawi to help develop an expenditure module for national health management information system, conduct a benefit Incidence Analysis (BIA) and Private Sector Assessment to complement the NHA, and build the capacity of Civil Society to meaningful participate in planning and oversight of health resources within the health sector.

FY09 Budget - $121,000 FY10 Budget - $500,000

Activity 1: National Health Accounts Estimation) In FY10, HS 20/20 is providing assistance for Malawi's 2009 NHA estimation, including subaccounts for Malaria, Child Health, Reproductive Health, and HIV/AIDS. The Malawi Health Financing component of this health system strengthening activity will work to improve the NHA production process and to increase the use of NHA findings. Malawi has completed 4 rounds of NHA for the years FY1995/6, FY1998/9, FY2002/3, FY2004/5 and, most recently, FY2005/6. The 1995/6 round, which included only a general NHA estimation, was undertaken by a Ministry of Health employee and was widely used for informing the 5-year National Health Strategic Plan (1999-2004). The 1999 round also included only a general NHA estimation. The 2002/3-2004/5 round included subaccounts for Child Health, Reproductive Health, and HIV/AIDS. The 2005/6 round, conducted with Global Fund support, included the HIV/AIDS, Tuberculosis, and Malaria subaccounts.

Malawi is now ideally placed to begin to institutionalize NHA, the goals of which are to strengthen and streamline NHA production as well as increase the use of NHA data by stakeholders. On the supply-side, this includes actions such as integrating NHA data sources into routine health information systems; building in-country capacity for data collection, analysis, and reporting; and designing and implementing tools that simplify the NHA production process. On the demand-side, we need actions geared towards disseminating NHA results to a wider array of stakeholders and building their capacity to use NHA to guide policy and planning, make decisions about resource allocation, and undertake routine monitoring and evaluation of health system functions.

Following on the completion of the NHA exercise in FY10, PEPFAR resources will support the following activities listed below in FY11. (Note, these activities will also be supported by other USG non-PEPFAR health funds, but only the planned PEPFAR contributions are noted below)

Activity 2: NHA Institutionalization

Institutionalization of NHA in middle and low-income countries means that the activities related to collecting, analyzing and reporting health care spending are systemized as an integral function of a government department with the purpose of increasing the availability and use of timely and accurate information on health expenditure. Institutionalizing NHA should be looked at as a government responsibility (not necessarily implying sole financing) that ought to be enveloped into routine processes with the objective of forming a core dataset for health policy development, monitoring and evaluation. This implies that for NHA to become an institutionalized activity it should meet two principles:

i. Become a core activity within the entity responsible for producing it; and ii. Be closely linked to policy requirements in order to be useful.

Simply having the capacity to carry out the technical aspects of national health accounts activities does not ensure that NHA is institutionalized. An environment that enables the initiation, growth, and sustainability of the NHA activities must also incorporate supportive policies, standardized methods for data reporting, effective leadership and adequate resource allocation which emphasizes the importance of NHA as a policy planning tool. Resources and structure that support the performance of the NHA technical team are also needed.

These essential elements provide the "staying power" for NHA; their presence or absence determines whether NHA remains a set of isolated, limited activities or becomes a core activity within the system. Building on previous experience of implementing NHA in middle and low-income countries, HS 2020 will provide technical assistance to help the GOM and other stakeholders put in place standardized procedures which will enable the GOM to institutionalize the NHA process.

Activity 3: Increasing key stakeholder involvement in NHA policy use:

a) To date, the full potential of NHA results to influence policy has not yet been fully realized. In the past, technical assistance has been largely for implementation and not for supporting policy penetration and implementation -- due to budget limitations. While efforts are made to involve NHA stakeholders on the technical (and steering committee) team, these representatives do not necessarily participate fully on the team limiting their ability to understand and use expenditure data for advocacy without further assistance. Consequently, once the estimations are completed, there has been limited use of the findings for policy purposes. Thus, there is need for continued assistance following the production of estimates such that their implications and value can be realized by local stakeholders.

Activity4: Develop an expenditure module for national health management information system:

This activity would incorporate an expenditure module into the national electronic health management information system (HMIS) at the district level. This innovation leverages a government's national HMIS to ensure provider expenditure data are collected routinely as part of facilities' routine information system. This entails training of providers on how to collect, enter, and tabulate expenditure data, preferably as part of broader HMIS trainings led by the government. The Health Metrics Network has been involved in supporting an open-source District Health Information System (DHIS) that is being rolled out to a number of countries in sub-Saharan Africa. The incorporation of an expenditure module into Malawi's health management information system could then be integrated into Health Metrics Network's broader efforts to promote the implementation of harmonized, feasible, and comprehensive DHIS in Africa.

Activity 5: Develop a donor/NGO database to regularly track health expenditure data

HS 20/20 will support the development of a national annual database of donor and NGO annual spending for health. The database would feature an online data collection tool to be annually emailed to donors and NGOs. In the spirit of the Paris Declaration, many country governments have expressed interest in making data collection of financing patterns routine. If an annual database were available, it would significantly reduce the cost and time to produce health accounts thus facilitating expenditure estimation on a routine basis.

Activity 6: Benefit Incidence Analysis (BIA) ($50,000) Policy makers are interested in measuring health system performance in terms of equity - do all citizens have access to basic health care? Benefit Incidence Analysis (BIA) is a method of computing the distribution of public and donor expenditures across different demographic groups, such as income groups, or women and men. BIA is an analytical tool to examine who (which segment of a population) benefits from health care expenditures. Here the benefit is defined as the public subsidy.

The public subsidy is equal to the total cost of a service less the amount (if any) that the individual paid for the service (i.e. out-of-pocket expenses for user fees). BIA can reveal how effectively governments/donors are able to target their limited resources towards meeting the needs of specific target groups, such as the poor (although this analysis can also break down the population by region,

age, or gender).

Health Systems 20/20 will work with the Government of Malawi to: 1. Specify the policy question(s) that the BIA is expected to inform. Typically, BIA answers the policy question "Are government and donor health expenditures benefitting intended target populations?" "Which income group is benefiting most from government and public health expenditures?" "Do women benefit equally as men?"

2. Decide how to group/categorize the beneficiaries based on policy objectives and interests. Options include: Income, sex, residence, tribe, etc.

3. Estimate the quantity of services used by individual for each beneficiary group for each type of care, for example, outpatient visits and hospital (inpatient) admissions.

4. Estimate the unit cost for the services by type of service using facility cost data.

5. Estimate the out-of pocket fees for services by types using household survey data.

6. Estimate the benefit (public subsidy) by defined population group

7. Finally, the findings need to be carefully interpreted and explained, and linked with currently health policy development in Malawi. The results can be presented in table and graphic format, as well as indices of progressivity such as the concentration index and the Kakwani index.

Activity 7: Private Sector Assessment: In order to better understand the current private sector activities in health in the country, a private sector assessment will be done, integrating findings from the NHA household survey and benefit incidence analysis so as to provide policy recommendations to the MOH and USAID/Malawi on programming needs in the private sector.

Activity 8: Governance: The active participation of Civil Society is essential to improve utilization of resources within the health system. HS 2020 will work closely with other USG partners, including PACT, which currently has over 20 indigenous sub partners, to support the following activities: • Technical assistance to build the capacity of Civil Society organizations in resource tracking tools, quality of services assessment, and ability to participate in the district budget process and health center

oversight. • Training journalists and other media operatives on how to report on health sector issues to ensure adequate coverage of health sector problems and innovations. Results of the NHA exercise or reports on budget execution and benefit incidence analysis for instance, would be a key area to link finance and governance. Assistance will also be provided to link civil society to journalistic media, thereby enabling them to have an outlet to express their views on the health sector.