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Tried Cash on Delivery for Vaccination? Try Again

March 27, 2013

Foreign aid program are often criticized for being weakly accountable: vis-à-vis both taxpayers from donor countries and citizens from developing countries. The problem with foreign aid programs, so the argument goes, is that they provide very opaque information about the implementation and the outcome achieved: one therefore does not know what the money have achieved. To address this problem the Centre for Global Development has proposed a new approach to foreign aid: cash on delivery (COD). This new model shifts the focus from the input (how much one spent) to the outcome (what has been achieved with the money). It does so because the donor will pay the money only upon delivery i.e. achievement of the agreed target. As they put it

We propose that donors offer to pay recipient governments a fixed amount for each additional unit of progress toward a commonly agreed goal, e.g. US$200 for each additional child who takes a standardized test at the end of primary school.

The advantages are several and two stands out: COD emphasizes outcomes rather than inputs thus increasing accountability and it directs attention to measuring progress thus promoting learning by doing. The COD model can be applied to public health interventions and one of the potential candidate is a vaccination campaign. Vaccination lends itself to this model because the outcome, i.e. the number of children vaccinated, can be quantified and measured. The formulation of a COD for vaccination campaign can be as follows: US$5 are paid for each additional child who is vaccinated with measles and/or polio vaccines and/or receives vitamin A (the standard practice for vaccination in emergency situation). Easy right? When COD was tried out in practice for vaccination it turned out that paying cash on delivery is not that easy. Here are some of the possible bottlenecks.

What Delivery? Imagine that the donor discusses the issue with the director of the primary health care department at the ministry of health (MOH) and it explains how COD works: cash is conditional upon delivery i.e. vaccination of a child. COD however cannot be formulated as US$ 5 dollars per each additional child vaccinated as vaccination has one peculiarity: one has to reach 95% of vaccination coverage to avoid any outbreak. The delivery bit of the COD is therefore to be formulated as the total number of children to be vaccinated (and not as any number of children vaccinated). And this creates the first problem: if you have a delivery target you also have the possibility to fail; and nobody in the ministry of health wants to be responsible for any failure if there are political elections the following year. So  a contract which is tied to a specific target (e.g. 500,000 children vaccinated) is not feasible as nobody in the MOH wants to hear about an overall target. This in turn breaks the accountability feedback loop created  by the COD: if cash is spent on vaccines for 500,000 children (the desidered target) yet such target does not appear in any contract with the MOH then no-one is responsible for how the vaccines are used if let’s say only 300,000 children are vaccinated.

Hands-off? One of the feature of the COD model is that the donor embraces an hands-off approach in the sense that it gives to the government the full responsibility and authority to design and implement the program. In the case of vaccination one of the essential component is the incentives for the vaccination teams. Now imagine that the MOH communicates to the donor that it does not want to be involved in the payment of any incentives as it wants to stay away from the risk of fund siphoned off for other purposes or any complaints from the field staff. The donor now can either wash its hands and leave the responsibility to the MOH or step in and arrange for the payment of incentives. If it goes for option 1 it heads to failure if it picks option 2 it steps into quicksand and ticks off the hands-off/responsibility advantage of  the COD model.

You Remember What I Said Yesterday?Forget About It. If the donor goes for option 2 then it partners with a local organization which will negotiate the contract with the MOH district physicians in each district. To do so one sets the target of how many children are to be vaccinated in each district and then explains that US$ 5 dollars will be paid per each additional child vaccinated. You start a 2 weeks vaccination campaign and after 1 week many district physicians realize that they will not achieve the target and therefore they will not get the full jackpot (calculated upon the district target was set by district physician himself; remember the hands-off). With no jackpot each district physician complains about the COD and accuses the donor of punishing the staff. The donor receives a phone call from the MOH director general who complains too. The donors backs off, commits to pay whatever the number of children vaccinated and COD is ticked off.

The COD model adopted for this specific public health intervention departs from the model outlined by CGD (the initial contract with the government was never detailed, verification of  the progress against outcome was not done indipendently etc) yet it is usefuld to point to how the COD model can look like in the real world and what problems it can encounter. Agreeing on a delivery target is problematic and thorny, handing over responsibility to government can turn out not feasible in some situations and targets at the microlevel are never definitive. All in all, the COD model has much potential, however is not magic bullet, at least for vaccination.

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