For pregnant women, insufficient and unhealthy diets were especially dangerous because they impacted their unborn babies, who were more likely to be born too small^source—known clinically as low birth weight. A baby’s size at birth plays an important role in its ability to thrive. Beyond the heightened risk of neonatal death, which is death less than four weeks after birth, low birth weight is associated with persistent health problems, poor cognitive development, low school achievement, and reduced lifetime earnings.^source

Inadequate access to quality care threatened newborn health. By 2003, the infant mortality rate was 16.5 per 1,000 live births,^source more than double that of neighboring Chile.^source According to experts, up to 6 in 10 newborn deaths could have been avoided with prenatal check-ups, appropriate care during labor and delivery, and early diagnosis and treatment.^source The nationwide trend was a preventable catastrophe, making each death even more of a tragedy.

In Argentina, the national constitution had guaranteed universal health coverage since 1994. Everyone in the country, with or without insurance, could seek health care through the public health system. For the unemployed—a group that ballooned during the financial crisis—this guarantee could only be met by public health services.

But policymakers worried that the public health sector was already stretched too thin.^source Public services had been chronically underfunded. Even worse, they failed to get the most health out of available resources, and their inefficiency proved hard to address.^source The public health system had been decentralized; provincial governments, not the federal government, held primary responsibility for providing health care. Health funds flowed from national to provincial to local budgets with no strings attached, leaving the central Ministry of Health with little leverage to improve efficiency, accountability, or the impact of provincial health spending.^source

Still, women in poverty had to rely on public health facilities for free antenatal care. The weak health services contributed to their deteriorating health status.^source Noting this link, Argentine health authorities knew something had to be done to boost the efficiency of public health spending and the health of uninsured women and children.^source National and provincial public health leaders agreed that changes were needed to improve coordination between the levels of government, identify the populations eligible for public sector coverage, and measure the system’s performance. Donors, such as the World Bank, also saw a need for operational changes.

The government and World Bank soon joined forces to design Plan Nacer, first introduced in a new Federal Health Plan for 2004-2007 and financed with the help of a World Bank loan.^source The essence of Plan Nacer's approach was to enhance the existing health system by providing incentives to provincial governments, which they passed on to healthcare providers. Specifically, the World Bank had seen an opportunity to improve accountability by incorporating Results-Based Financing (RBF)—the linking of financial incentives with improved outcomes—in the budget-transfer mechanism.^source

The program was initially launched in nine Northern provinces, home to Argentina's highest maternal and child mortality rates. Starting in 2007, the program gradually expanded across Argentina, achieving national coverage by 2012.^source

Plan Nacer had five components: 1) legally binding agreements between national and provincial health ministries; 2) enrollment of health providers; 3) enrollment of the target population; 4) increased funding for delivery of priority services; and 5) record-keeping, reporting, audits, and evaluations.^source At the national level, the Ministry of Health determined the health targets the provinces were expected to achieve, which were measured through 10 performance indicators for health outcomes, service delivery, and equity. Plan Nacer also established contractual relationships between central and provincial health ministries and between provincial health ministries and public providers. 

By the end of 2008, the Plan had contracted 2,000 public health providers—57 percent of the total^source—and by the end of 2012, 7,254 health facilities were participating.^source By enrolling in Plan Nacer, public providers committed to track service delivery and provide regular reports to provincial authorities. Providers also agreed to regular external audits, with the threat of penalties for inaccurate reporting.^source

Participating providers and provincial health staff worked to enroll eligible people: uninsured pregnant women and children under the age of six.^source Enrollment was purely voluntary, but financial incentives helped motivate providers to bring participants onboard.

Once enrolled, women, babies, and young children enjoyed free access to a menu of Plan Nacer health benefits specified by the federal government.^source By the end of 2008, the program had enrolled 82 percent of the eligible population in priority provinces,^source and by the end of 2012, two million pregnant women and children were enrolled. ^source

The central government paid for Plan Nacer through an RBF model.  The national Ministry of Health allocated a per capita value of about US$5 to the program. The specific amount of the transfers from the central government to provinces varied, reflecting the provinces' differing performance in enrolling beneficiaries, delivering services, and improving patients’ health status. Each month, the central government transferred 60 percent of the per capita value to provinces based on the number of beneficiaries enrolled.^source Provinces were eligible to receive the remaining 40 percent every four months, based on their performance against the 10 indicators. Provinces then redeployed their Plan Nacer resources to compensate contracted health providers for their services to beneficiaries.

By incentivizing public providers to achieve health outcomes, provincial health staff encouraged delivery of effective services. And thanks to additional Plan Nacer financing, hospitals and clinics could afford to improve service delivery. Within broad central guidelines, providers had flexibility to determine the best use of Plan Nacer ‘surplus’ funds that remained after covering the costs of service delivery. Facilities typically spent the extra money on staff salaries, new supplies, and maintenance.^source

An impact evaluation of Plan Nacer points to the program's success: birth outcomes improved and neonatal mortality decreased. The evaluation was a collaboration between the World Bank and the Argentine Ministry of Health and covered the years 2005 to 2008 in seven of the original Plan Nacer provinces. Researchers demonstrated that Plan Nacer benefitted every newborn in participating health facilities, and that it was even better for babies born to mothers enrolled in the program.^source

In large hospitals, Plan Nacer reduced enrolled babies’ risk of neonatal death by an astonishing 74 percent. Even nonbeneficiaries saw impressive gains; babies born in participating facilities were 22 percent less likely to die during the neonatal period, whether or not they were enrolled in the plan.^source

More and better prenatal care explained the plan’s mortality effect. The evaluators determined this by analyzing changes in the number of prenatal care visits, the probability of receiving a tetanus vaccine, and rates of caesarian-section. For example, women enrolled in the plan were 20 percent less likely to need a risky C-section than nonbeneficiaries—a result of the plan’s efforts to identify and solve problems well before delivery.^source

Just over half of the neonatal mortality decline can be attributed to reductions in low birth weight: 19 percent among beneficiaries and 9 percent among all babies in participating facilities.^source Less low birth weight meant more resilient newborns. And when babies did arrive underweight despite providers' best efforts, better postnatal care helped them survive into childhood.

Aggregating these results across the seven provinces, Plan Nacer averted an estimated 773 neonatal deaths, 1,071 low birth-weight babies, and 25,401 total disability adjusted life years between 2005 and 2008.^source

Plan Nacer accomplished a lot without costing much. On average, funding for the incentives totaled less than 1 percent of total public spending on health at the provincial level.^source In 2008, the program spent just US$39 million—a small fraction of the roughly US$4 billion in total public spending on health that year. Of course, Plan Nacer's budget covered only the costs of the incentives; the funding model worked because it was an add-on to routine financing for the rest of the provinces, including providers’ salaries.

From 2005 to 2008, the central government transferred a total of US$107 million to the first nine provinces. This was supplemented by a loan of $16 million from the World Bank, and provincial governments later took over 30 percent of the total costs.^source By co-financing the Plan, the provincial governments gained autonomy and flexibility, which they passed on to facilities.^source

Plan Nacer’s evaluators concluded that Plan Nacer was highly cost-effective in the Argentine context, with an estimated cost per DALY of US$814, well under the gross domestic product per capita of US$6,075.

Extending the use of incentives across all levels of Argentina’s health system, empowering providers to control the use of new funds, and creating a culture of accountability were keys to Plan Nacer’s success.

High-level public health officials contributed to Plan Nacer’s design from the start.^source  A strong political and technical team interacted with a range of partners and stayed abreast of the changing context. As the program evolved, team members also had the courage to challenge the status quo and identify emerging opportunities, allowing them to fine-tune management tools and performance goals. In addition, Plan Nacer’s National Coordinator, Martín Sabignoso, ably led the program over multiple years and through ministerial changes at national and provincial levels, as well as through its nationwide expansion.

Plan Nacer worked well within Argentina’s decentralized health system. Program staff carefully balanced financial flows across the system, using a relatively modest pot of health funds to encourage efficient use of the larger provincial health budgets.^source By combining incentives for both enrollment and services, Plan Nacer prevented providers from enrolling beneficiaries without providing services.

By devolving management and decision-making to provincial and lower levels, the program increased autonomy, empowered providers, and nurtured creativity. In some facilities, the decision about how to use extra Plan Nacer resources was made based on group consensus. In one facility, providers passed an incentive on to users: at Christmas, a health center of La Pampa buys bicycles (purchased with Plan Nacer funds) for all those children whose vaccines and checkups are up to date.^source

Implementers have attributed the program's success to the measurement, feedback, and learning that emerged over the course of the program. The intensive process of auditing and verifying clinic records made it possible to check the validity of payments, while penalties for improper recording or billing improved records and data quality.^source  Program leaders also made a commitment to ongoing learning from the process, and audits enabled staff to review and improve.^source For instance, staff added new performance and health impact indicators, increased targets, and differentiated payments based on the complexity of achieving each goal.^source

Plan Nacer also promoted social accountability.^source To educate enrollees on program benefits, some facilities posted menus of covered services. Staff also linked patient satisfaction to service providers’ payment based on user opinion surveys. And a Plan Nacer website publicized the performance of each province and the amount of funds disbursed.^source

Finally, post-crisis trends such as improving macro-economic conditions and improving political stability contributed to a smooth implementation of the program.^source Following the reelection of President Cristina Fernández Kirchner in 2011, health ministers in 13 provinces were replaced. However, all provincial Plan Nacer coordinators kept their jobs, suggesting the new health ministers understood Plan Nacer’s value.

With Plan Nacer, Argentina became the first low- or middle-income country to use incentives to simultaneously expand health coverage and improve birth outcomes. Thanks to the evaluation and wide dissemination of its results, Argentina’s experience is inspiring other countries to pay for results rather than inputs. Panama, the Dominican Republic, and Guatemala are using payment arrangements modeled on Plan Nacer.^source

Plan Nacer was not expensive to implement, and is considered highly cost-effective. This suggests that aspects of the approach can be implemented even in health systems with fewer resources. As evident in Argentina’s experience, what is needed are a leadership team that can drive change and collaborate with counterparts at different levels, and a reliable system for collecting and communicating data.

As an agreement between federal and provincial ministries, Plan Nacer differs from the standard pay-for-performance approach practiced elsewhere. Nevertheless, it includes elements that can inform design decisions for RBF programs, such as the size and source of the budget, its financing structure, and the size of incentive payments. It also highlights the importance of investing in facilities before launch to help them cope with the increased demand that is sure to emerge. Policymakers must also carefully consider which services to cover; incentives can discourage health workers from providing nonincentivized services.^source

While lessons from Plan Nacer can be instructive for other health ministries taking on RBF, there is still room for improvement in Argentina. It remains a challenge to reach the poorest and those living in the most remote areas, and some vulnerable groups remain underserved because they are unaware of their entitlement to health benefits.^source Despite these obstacles, Plan Nacer has grown to include additional populations. In 2012, the government started a new program, Programa Sumar, to expand coverage to children ages 6 to 19 and women ages 20 to 64. In mid-2015, the new program expanded to cover uninsured men ages 20 to 64. The new program had reached a total of 16 million children and adolescents, pregnant women, and adult women and men as of July 2015.^source Continuing to expand access by paying for results will be integral to further improve efficiency and equity—and most importantly, Argentines’ health.^source