HEALTH FINANCE AND GOVERNANCE PROJECTFederal Agency Name: United States Agency for International Development (USAID), Bureau for Global Health (GH), Office of Health, Infectious Disease and Nutrition (HIDN) Funding Opportunity Title: Request for Application (RFA): Health Finance and Governance Project (HFG) Announcement Type: Initial Funding Opportunity Number: RFA-OAA-12-000011 Catalog of Federal Domestic Assistance (CFDA) No.: 98.001 Dates: RFA Issuance Date: May 4, 2012 RFA Questions Due: May 15, 2012, 1:00 PM Past Performance Application Due: May 29, 2012, 1:00 PM RFA Closing Date: June 6, 2012, 1:00 PM Note: All times specified in this RFA are in Eastern Daylight Time (EDT). Executive Summary: The purpose of the Health Finance and Governance Project is to increase the use of priority health care services, including primary health care services, by partner countries populations through improved governance and financing systems in the health sector. Partner countries health systems are constrained by inadequate availability and inefficient use of resources, limiting their ability to reach their people with quality services. Under the Health Finance and Governance Project, partner countries will increase domestic resources available for health care, manage those resources more effectively, and increase the efficiency of purchasing decisions. Improved governance of the health sector will occur through improved strategic planning, and more efficient and accountable operations, thus enhancing the relevance and responsiveness of the health system to populations needs. The Health Finance and Governance Project responds to the many changes in the economic and global health environment over the past decade, specifically the substantial changes in the architecture of global health finance and governance. The role of non-state financing agents addressing health systems has increased and is maturing, including the Global Fund for AIDs, Tuberculosis, and Malaria (GF), the GAVI Alliance, the Rockefeller Foundation, and the Bill and Melinda Gates Foundation, other private voluntary and non-governmental organizations, foundations, and universities. There is new emphasis globally on achieving universal health coverage (UHC) and increasing experimentation with performance-based incentive programs forPage of 110

health. New mechanisms for the delivery of health development assistance have emerged, such as sector-wide approach related budget supplementation, and the GF, GAVI Alliance and World Bank-sponsored Health Systems Funding Platform. USAIDs own reforms in procurement and the Global Health Initiative (GHI) principles present new opportunities to address health systems. Traditional aid donors including bilaterals, development banks, and foundations are experiencing a long recession that will constrain their ability to provide development assistance for health in the near and very likely longer term. This has placed a greater emphasis on country ownership of health sector assistance and on sharing the responsibility for financing service delivery among public, private, and outside donor sources. At the same time, a growing number of developing countries are experiencing significant economic growth. Such growth provides those countries with the opportunity to increase their fiscal space for health and to allocate it in a manner that is more efficient and equitable. This project will assist these countries to develop the tools and strategies necessary to achieve the projects purpose and its results. General RFA Information: Partnering: USAID anticipates that Applicants may indicate formal arrangements with partner organizations or with sub-awardees for implementing this activity in their application. Estimated Number of Awards: USAID intends to award one (1) Cooperative Agreement under this RFA for up to $200,000,000.00 over five (5) years. Cost Share Minimum Amount: 5% of the total cooperative agreement amount shall be provided by the prime recipient. (see Section III. Eligibility Information, for more specific information) Issuance of this RFA does not constitute an award commitment on the part of the Government, nor does it commit the Government to pay for costs incurred in the preparation and/or submission of an application. The Government reserves the right to reject any or all applications received. Pursuant to 22 CFR 226.81, no funds shall be paid as profit to any recipient that is a commercial organization. However, all reasonable, allowable and allocable expenses, both direct and indirect, which are related to the Agreement program and are in accordance with applicable cost standards (22 CFR 226, OMB Circular A-122 for non-profit organization, OMB Circular A-21 for universities, and the Federal Acquisition Regulation (FAR) Part 31 for profit organizations), may be paid under the agreement. Final award of any resultant cooperative agreement cannot be made until funds have been fully appropriated, allocated, and committed through internal USAID procedures. While it is anticipated that these procedures will be successfully completed, potential applicants are hereby notified of these requirements and conditions for award. The Agreement Officer is the only individual who may legally commit the Government to the expenditure of public funds. No costs

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chargeable to the proposed Agreement may be incurred before receipt of either a fully executed Agreement or a specific, written authorization from the Agreement Officer. Points of Contact and Questions: The Agency points of contact for this RFA are as follows: Primary Point of Contact: Moyra Cassidy, M/OAA/GH 202-567-5014 mcassidy@usaid.gov Alternate Point of Contact: Stella Alexander-Sergeeff, M/OAA/GH 202-567-4774 salexandersergeeff@usaid.gov Prospective applicants shall submit all questions in writing via email ONLY to both mcassidy@usaid.gov and salexandersergeeff@usaid.gov no later than 1:00 PM EDT on May 15, 2012 (also see RFA Dates on the cover sheet). Questions may not be answered prior to the closing date of questions. Phone calls regarding any questions concerning this RFA may not be accepted. It is anticipated that questions submitted by prospective applicants and the corresponding answers will be communicated via an amendment to the RFA and will be posted on Grants.gov. Questions submitted after the specified closing date of the open question period may not be accepted or answered. Information Distribution: The preferred method of distribution of USAID assistance information is via the Internet. This RFA contains all necessary information, web links, and materials to submit a complete, full application. Any additional information regarding this RFA will be furnished through an amendment that is communicated through Grants.gov. This RFA and any future amendments can be downloaded from the World Wide Web Address at http://www.grants.gov. In order to apply to this RFA, an applicant organization must be registered on Grants.gov. Additionally, in order to submit an application, organizations must have a current registration in the Central Contractor Registry (CCR). If an organization is currently not registered in CCR, Applicants are advised to begin the registration process IMMEDIATELY upon the issuance of this RFA. For issues with registering contact the Agency points of contact listed in Section VII: Agency Contacts. For instructions on how to register to Grants.gov and/or register to the CCR, see Annex D of the RFA. Also, see Section IV: Application and Submission Information for more specific information. Thank you for your interest in this USAID initiative. USAID looks forward to your organizations participation.

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TABLE OF CONTENTSSECTION I - FUNDING OPPORTUNITY DESCRIPTION .................................................................7 A. Introduction ..................................................................................................................................... 7 B. Background ..................................................................................................................................... 8 C. Program Purpose .......................................................................................................................... 15 D. Statement of Expected Results .....................................................................................................15 E. Core Operating Principles............................................................................................................28 F. Funding Principles ........................................................................................................................29 G. Key Personnel ............................................................................................................................ 31 H. Gender Considerations .............................................................................................................33 I. Monitoring and Evaluation ..........................................................................................................34 J. Knowledge Management ..............................................................................................................35 K. Reporting Requirements ..........................................................................................................35 L. Implementation and Procurement Reform ................................................................................39 SECTION II. AWARD INFORMATION ..............................................................................................40 A. Estimated Funding Available, Number of Awards, Type of Award ........................................ 40 B. Anticipated Award Schedule........................................................................................................40 C. Geographic Focus.......................................................................................................................... 40 D. USAID Management of the Activities .........................................................................................40 E. Substantial Involvement ...............................................................................................................40 F. Implementation Period Page of 110

.................................................................................................................41 G. Authorized Geographic Code ..................................................................................................41 SECTION III. ELIGIBILITY INFORMATION...................................................................................42 A. Eligibility Requirements...............................................................................................................42 B. Eligibility Criteria .........................................................................................................................42 C. U.S. PVO Registration ..................................................................................................................42 D. Pre-award Responsibility Determination ...................................................................................42 E. Cost Share ...................................................................................................................................... 43 F. Application Limitations ................................................................................................................43 G. Implementation Period .............................................................................................................43 SECTION IV. APPLICATION AND SUBMISSION INFORMATION ............................................. 44

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A. Address to Request Application Package ...................................................................................44 B. How to Submit Questions in Response to this RFA ...................................................................44 C. Prime Applicant Partners/ Major Subawardees.......................................................................44 D. General Application Submission Instructions............................................................................44 E. Required Contents of an Application ..........................................................................................45 F. Required Format and Content of Application Documents ....................................................... 46 G. Required Content for the Past Performance Application ..................................................... 50 H. Required Content for the Technical Application ...................................................................51 I. Required Content for the Cost Application ................................................................................56 J. Submission Dates and Times........................................................................................................60 K. Timeliness .................................................................................................................................. 61 L. Submission Instructions ...............................................................................................................61 M. Funding Restrictions.................................................................................................................62 SECTION V. APPLICATION REVIEW INFORMATION ................................................................ 64 A. Overview of the Application Review ...............................................................................................64 B. Addressing Eligibility Criteria ..........................................................................................................64 C. Responsiveness ............................................................................................................................... 64 D. Application Evaluation Overview ....................................................................................................64 E. Evaluation of Technical Application and Past Performance Application ........................................ 64 F. Past Performance Adjectival Rating................................................................................................65 Page of 110

G. Past Performance Application Evaluation Criteria..........................................................................65 H. Technical Application Adjectival Rating ..........................................................................................66 I. Technical Application Evaluation Criteria .......................................................................................66 J. Cost Application Evaluation Criteria / Cost Effectiveness and Cost Realism .................................. 68 K. Acceptability of Proposed NonPrice Terms and Conditions .......................................................... 68 SECTION VI. AWARD ADMINISTRATION INFORMATION...................................................... 69 A. Award Notices ............................................................................................................................... 69 B. Authority to Obligate the Government .......................................................................................69 C. Branding & Marking Requirements ...........................................................................................69 D. Standard Provisions ........................................................................................................................80 E. Reporting Requirements................................................................................................................. 81 SECTION VII: AGENCY CONTACTS .................................................................................................82

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SECTION VIII: Other Information........................................................................................................83 A. USAID Rights and Funding .........................................................................................................83 B. Regulations and References .........................................................................................................83 ANNEX A: COUNTRIES LIST...........................................................................................................84 ANNEX B: Health Finance and Governance Project Results Framework ...................................... 86 ANNEX C: 88 ANNEX D: 90 CONDITIONS OF REGISTRATION FOR U.S. ORGANIZATIONS ...................... INSTRUCTIONS ON HOW TO REGISTER ON GRANTS.GOV .........................

ANNEX E: HFG APPLICATION SCREENING FORM ..................................................................93 ANNEX F: PAST PERFORMANCE SHORT FORM .......................................................................94 ANNEX G: TITLE PAGE FORMAT..............................................................................................96 ANNEX H: FINANCIAL REPORTING FORMS AND INSTRUCTIONS ................................ 97 ANNEX I: CERTIFICATIONS, ASSURANCES AND OTHER STATEMENTS OF THE RECIPIENT 98 ANNEX J: INITIAL ENVIRONMENTAL EXAMINATION (IEE) ............................................ 110

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SECTION I - FUNDING OPPORTUNITY DESCRIPTION A. Introduction The purpose of the Health Finance and Governance Project is to increase the use of priority health care services, including primary health care services, by partner countries populations through improved governance and financing systems in the health sector. Partner countries health systems are constrained by inadequate availability and inefficient use of resources, limiting their ability to reach their people with quality services. Under the Health Finance and Governance Project, partner countries will increase domestic resources available for health care, manage those resources more effectively, and increase the efficiency of purchasing decisions. Improved governance of the health sector will occur through improved strategic planning, and more efficient and accountable operations, thus enhancing the relevance and responsiveness of the health system to populations needs. The Health Finance and Governance Project responds to the many changes in the economic and global health environment over the past decade, specifically the substantial changes in the architecture of global health finance and governance. The role of non-state financing agents addressing health systems has increased and is maturing, including the Global Fund for AIDs, Tuberculosis, and Malaria (GF), the GAVI Alliance, the Rockefeller Foundation, and the Bill and Melinda Gates Foundation, other private voluntary and non-governmental organizations, foundations, and universities. There is new emphasis globally on achieving universal health coverage (UHC) and increasing experimentation with performance-based incentive programs for health. New mechanisms for the delivery of health development assistance have emerged, such as sector-wide approach related budget supplementation, and the GF, GAVI Alliance and World Bank-sponsored Health Systems Funding Platform. USAIDs own reforms in procurement and the Global Health Initiative (GHI) principles present new opportunities to address health systems. Traditional aid donors including bilaterals, development banks, and foundations are experiencing a long recession that will constrain their ability to provide development assistance for health in the near and very likely longer term. This has placed a greater emphasis on country ownership of health sector assistance and on sharing the responsibility for financing service delivery among public, private, and outside donor sources. At the same time, a growing number of developing countries are experiencing significant economic growth. Such growth provides those countries with the opportunity to increase their fiscal space for health and to allocate it in a manner that is more efficient and equitable. This project will assist these countries to develop the tools and strategies necessary to achieve the projects purpose and its results. The authorizing legislation for this Cooperative Agreement is the Foreign Assistance Act of 1961, as Amended, and the award is subject to 22 CFR 226 Administration of Assistance Awards to U.S. Non-Governmental Organizations. The following are applicable for the 1 administration of this award : - For U.S. organizations, 22 CFR 226, OMB circulars, and the Standard Provisions for U.S. Non-governmental Recipients are applicable.1

See Section VIII: Other Information for specific websites on where to find the full text of this information.

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For non-U.S. organizations, the Standard Provisions for Non-U.S. Non-governmental Recipients will apply.

For the purposes of this RFA, the word project and the word program are used interchangeably to refer to this Health Finance and Governance initiative. USAID anticipates that Applicants may indicate formal arrangements with partner organizations or with sub-awardees for implementing this activity in their application. B. Background Health Systems Strengthening is a process that concentrates on ensuring that people and institutions, both public and private, undertake core functions of the health system (governance, financing, service delivery, health workforce, information, and medicines/vaccines/other technologies) in a mutually enhancing way, to improve health outcomes, protect citizens from catastrophic financial loss and impoverishment due to illness, and ensure consumer satisfaction, in an equitable, efficient and sustainable manner. This process, whether guided by individual governments, nongovernmental organizations (NGOs), civil society, or donor agencies, is under way in many countries as their populations needs change and grow. This section presents the overarching framework guiding USAID health system strengthening efforts and describes the relationship of the Health Finance and Governance Project to other USAID health projects. It also reviews the relevance of new key U.S. Government (USG) policies and initiatives, including the USG Foreign Assistance Framework and the GHI, to the project design and core operating principles. USAID USAID programs in global health represent the commitment and determination of the United States Government to prevent suffering, save lives, and create a brighter future for families in the developing world. (Annex A: Countries List, lists the countries in which USAID maintains health programs.) USAID's commitment to improving global health includes confronting global health challenges through improving the quality, availability, and use of essential health services. USAID's objective is to improve global health, including child, maternal, and reproductive health, and reduce abortion and disease, especially HIV/AIDS, malaria, and tuberculosis. USAID provides support to global health efforts through technical leadership, research and innovation, and the transfer of proven technologies to the field. USAID collaborates with other development partners at the central level and in the field. USAID field Missions collaborate with partner governments and non-state actors to build institutional capacity, strengthen health systems and deliver needed services. USAIDs health system strengthening program provides support to ensure that developing country health systems are effective, efficient, and equitable. Working health systems are vital to ensure widespread use of effective health measures. Fundamentally, a working health system improves health. It delivers the right volume and distribution of services using good provider- client interactions. It operates at the community, sub-national and national levels. A working health system uses effective organizations and processes. It engages households, governments, the private sector, donors, and global initiatives. It reaches priority groups, including the poor, women, children, urban poor and rural residents, and the acutely and chronically ill. It respondsPage of 110

to peoples needs, protects them from risk, and operates efficiently. It combats priority health issues such as tuberculosis, HIV/AIDS, malaria, and maternal, child, and reproductive health. It works fairly, responsively, and effectively, and offers choice. It employs appropriate incentives and is characterized by strong political will and a viable vision. Over the past four decades, USAID has financed a range of health systems strengthening projects, from large scale global projects to smaller scale Mission bilateral projects. These projects have operated on a wide spectrum of health systems issues, including human resources, pharmaceutical management, logistics, quality assurance, private sector development, information systems, health finance, and health policy. Since 1989, USAID has sponsored four global flagship projects to help improve health financing and policy in developing countries: Health Financing and Sustainability in 1989 ($16.5 million), Partnership for Health Reform in 1995 ($58 million), Partners for Health Reform Plus in 2000 ($98 million), and Health Systems 20/20 ($125 million). These projects were developed globally under the premises that these activities would require highly specialized technical assistance that is scarce and thus difficult for Missions to procure individually, and that Mission demand for the projects would be high. These premises have proven to be true, as the size and scope of each project has progressively grown over time. The most recent project (Health Systems 20/20) received $78 million in field support, serving 35 Missions and regional bureaus. Under these projects, significant advances have been made in understanding and addressing the health systems constraints that undermine the equity, efficiency, quality, and effectiveness of priority health services. USAID's previous work on health financing has proven to be highly effective and widely adopted, such as health resource tracking and community-based financing. As the evidence base of "what works" in health systems strengthening has grown, so too has our conceptualization of what is needed. Applicants may be interested to research this experience at: USAIDs Development Experience Clearinghouse (dec.usaid.gov); The Partners for Health Reformplus website (www.phrplus.org); and Health Systems 20/20 (www.hs2020.org). The Health Finance and Governance Project will work with other Bureau for Global Health (GH) programs that focus on specific aspects of health system strengthening, as follows: The Health Policy Project aims to strengthen policy, advocacy, and governance for strategic, equitable, and sustainable health programming in developing countries. The project expands on previous investments in policy work by building government, civil society, and other partners capacity to advocate for, direct, and finance health programs. Doing so will help ensure that partner countries are at the center of decision making for their health programs. The goal of the Strengthening Health Outcomes through the Private Sector (SHOPS) program is to increase the role of the private sector in programs that address family planning (FP)/reproductive health (RH), HIV/AIDS, and other health information, products, and services. It aims to support the expansion of public sector health services by increasing private sector involvement to serve those who can pay for private healthPage of 110

services and medicines. The Support for Improvement Science project (SIS), which will be the follow-on to the Health Care Improvement Project, will use modern improvement methodologies adapted from the US health care system to identify and test changes in health care that may improve clinical quality, efficiency, and patient-centeredness. SIS will provide a range of services related to other quality improvement strategies, most notably the establishment of improvement collaboratives. The Systems for Improved Access to Pharmaceuticals and Services (SIAPS) project focuses on enhancing pharmaceutical services through patient-centered solutions while continuing to support essential supply chain functions and medical products supply security. SIAPS goal is to support the achievement of improved and sustained health outcomes by applying a systems strengthening approach consistent with GHI principles. Result areas address the intersections of five health systems components (governance, human resources, information, financing, and service delivery) in the design of potential interventions to ensure that they respond to health element and cross cutting concerns in support of health system strengthening. The CapacityPlus program aims to improve the quality of health services in the developing world by strengthening the health care workforce to help reach the Millenium Development Goals. In countries where both CapacityPlus and the Health Finance and Governance Project work, the programs will coordinate on issues of human resource (HR) policy and planning, including strengthening HR management systems, and improving workforce development, incentive structures, and financing and management systems. The Sustainable Leadership, Management and Governance program (SLMG) supports health systems strengthening by addressing the gap for sustainable leadership, management, and governance capacity of health care providers, program managers, and policy makers to implement quality health services at all levels of the health system. The Health Finance and Governance Project will complement the efforts of SLMG and will contribute to the development of best practices and lessons learned, in particular with respect to developing the governance capacity of partner countries, and strengthening stewardship within institutions to assume greater responsibility for strengthening health systems. The MEASURE Evaluation Phase III program works to strengthen routine health information systems, to build capacity in host country institutions, to develop new tools and methodologies, and to conduct evaluation research. In addition, it facilitates the coordination of monitoring and evaluation and routine health information system strengthening efforts.

Foreign Assistance Framework The USG strategy for development and foreign assistance has the overall goal of helping to build and sustain democratic, well-governed states that will respond to the needs of their people andPage of 110

conduct themselves responsibly in the international system. As part of this goal, the Foreign Assistance Framework identifies Investing in People as one of five priority objectives. Investing in People includes improving global health and involves all of the following Health Elements: HIV/AIDS, Tuberculosis (TB), Malaria, Avian Influenza (AI), Neglected Tropical Diseases, Maternal and Child Health, Family Planning and Reproductive Health, and Water Supply and Sanitation. The Foreign Assistance objectives recognize that improving the health of populations contributes to increased workforce productivity and economic growth, while improving governance leads to a stronger civil society and social stability all of which provide an environment necessary for citizens to achieve their full potential. Health challenges and issues vary from country to country depending upon the burden of disease and the stage of development of health systems. Therefore, USAIDs strategies and approaches must be customized and tailored to the situation at the country-level based on an assessment of political commitment, technical opportunities, priorities, funding, and sustainability concerns. The USG Foreign Assistance Framework provides a useful perspective by identifying various categories of countries: Rebuilding, Developing, Transforming and Sustaining Partnership countries. The health context in these categories of countries needs to be considered in designing solutions to address health system constraints and build sustainable systems. More information on the USG Foreign Assistance Framework is available at http://www.state.gov/s/d/rm/rls/dosstrat/2007/html/82981.htm. The Quadrennial Diplomacy and Development Review (QDDR) The QDDR is assessment of how the Department of State and USAID can increase efficiency, accountability, and effectiveness in a world in which rising powers, growing instability, and technological transformation create new threats, but also new opportunities. It also provides a blueprint for elevating American civilian power to better advance the US national interests and to provide better partnership with the U.S. military. The QDDR calls for civilian leadership by directing and coordinating resources of America's civilian agencies to prevent and resolve conflicts; helping countries lift themselves out of poverty into prosperous, stable, and democratic states; and building global coalitions to address global problems. More information on the QDDR is available at: http://www.state.gov/s/dmr/qddr/ The Presidential Policy Directive on Global Development This directive, the first of its kind by a U.S. administration, recognizes global development as a vital part of U.S. national security and a strategic, economic, and moral imperative for the United States. It calls for the elevation of global development as a core pillar of American influence abroad, and provides policy guidance for U.S. government agencies supporting the three areas of defense, diplomacy, and development to work together through an integrated, comprehensive and complementary approach to support U.S. national security priorities and to achieve core policy objectives. More information can be found at: http://www.state.gov/ppd/index.htm or http://www.usaid.gov/unga/ppd.html. USAID ForwardPage of 110

USAID Forward is based on the Quadrennial Diplomacy and Development Review and reflects a reform agenda with the intent to modernize the way USAID works. Under USAID Forward, the Agency is providing a comprehensive package of reforms in seven key areas: 1. Implementation and Procurement Reform: USAID will change and streamline its business processes: contracting with and providing grants to more and varied local partners, increasing the use of small businesses, building metrics into its implementation mechanisms to achieve capacity building objectives, and using host country systems where it makes sense. 2. Talent Management: USAID will explore ways to leverage the enormous talent within the broader family of foreign and civil service officers and foreign service nationals, and will improve and streamline processes so it can quickly align its resources to support the Agencys strategic initiatives. 3. Rebuilding Policy Capacity: USAIDs new Bureau of Policy, Planning and Learning (PPL) serves as the intellectual nerve center for the Agency and will develop and disseminate cuttingedge, evidence-based development policies that leverage USAIDs relationships with other donors, utilize its strength in science and technology, and reintroduce a culture of research, knowledge-sharing, and evaluation. 4. Strengthening Monitoring and Evaluation: Learning by measuring progress is critical for high impact, sustainable development and will be an integral part of USAIDs thought process from the onset of its activities. USAID will introduce an improved monitoring and evaluation process and will link those efforts to its program design, budgeting, and strategy work. (The Agencys new Evaluation Policy is available at http://www.usaid.gov/evaluation/.) 5. Rebuilding Budget Management: USAID has created an Office of Budget and Resource Management in the Office of the Administrator and is rebuilding our budget capacity to be able to align resources against country strategies, make difficult trade-offs, and redeploy resources toward programs that are demonstrating meaningful results. 6. Science and Technology (S&T): USAID will expand its internal S&T capacities and capabilities and also will build S&T capacity in developing countries through cooperative research grants, improved access to scientific knowledge, and higher education and training opportunities. In addition, the Agency will develop a set of Grand Challenges for Development to focus the Agency and development community on key scientific and technical barriers that limit breakthrough development progress. 7. Innovation: USAID is putting into place a structure for fostering innovative development solutions that have a broad impact on the worlds people. USAID is creating opportunities to connect its staff to leading innovators in the private sector and academia, and has created the Development Innovation Ventures Fund where creative solutions can be funded, piloted, and brought to scale. (http://www.usaid.gov/div/) The Global Health Initiative (GHI) The Global Health Initiative (GHI) was developed to combine the efforts of several USG agencies to address global health challenges. These agencies include the State Department, USAID, Health and Human Services including the Centers for Disease Control, the Peace Corps, the Defense Department, and other agencies that work under PEPFAR. The GHI aims to improve integration and coordination across these agencies through better business practices including: Collaborating for impact by promoting country ownership and improved coordination across U.S. agencies and with other donors; Doing more of what works, by identifying, evaluating and scaling up approaches to keyPage of 110

public health issues; Building on and expanding existing country-owned platforms to foster stronger systems and sustainable results; and Innovating for results, by identifying, implementing, and rigorously evaluating new approaches that reward efficiency, effectiveness, and sustainability.

GHIs operating principles: Implement a woman- and girl-centered approach Increase impact through strategic coordination and integration Strengthen and leverage key multilateral organizations, global health partnerships and private sector Encourage country ownership and invest in country-led plans Build sustainability through health systems Improve metrics, monitoring and evaluation Promote research and innovation Priority health services comprise the Health Elements through which USAIDs health programs are funded. These include: HIV/AIDS, malaria, tuberculosis, neglected tropical diseases, other public health threats, maternal and child health, nutrition, family planning, and water supply/sanitation. The following health element-specific goals and targets have been defined for the GHI: HIV/AIDS: The U.S. President's Emergency Plan for AIDS Relief (PEPFAR) will: (1) support the prevention of more than 12 million new HIV infections; (2) provide direct support for more than six million people on treatment; and (3) support care for more than 12 million people, including five million orphans and vulnerable children. (http://www.pepfar.gov/) Malaria: The President's Malaria Initiative (PMI) will reduce the burden of malaria by 50 percent for 450 million people, representing 70 percent of the at-risk population in Africa, and expand malaria efforts into Nigeria and the Democratic Republic of Congo. (http://www.pmi.gov/) Tuberculosis (TB): Save approximately 1.3 million lives by reducing TB prevalence by 50 percent. This will involve treating 2.6 million new TB cases and 57,200 multi-drug resistant cases of TB. (http://www.usaid.gov/our_work/global_health/id/tuberculosis/index.html) Maternal Health: Save approximately 360,000 women's lives by reducing maternal mortality by 30 percent across assisted countries. (http://www.usaid.gov/our_work/global_health/mch/mh/index.html) Child Health: Save approximately three million children's lives, including 1.5 million newborns, by reducing under-5 mortality rates by 35 percent across assisted countries. (http://www.usaid.gov/our_work/global_health/mch/ch/index.html) Nutrition: Reduce child under-nutrition by 30 percent across assisted food-insecure countries, in conjunction with the President's Feed the Future Initiative. (http://www.feedthefuture.gov/) Family Planning and Reproductive Health: Prevent 54 million unintended pregnancies by meeting unmet need for modern contraception. Contraceptive prevalence is expected to rise to 35 percent across assisted countries, reflecting an average two percentage pointPage of 110

increase annually. First births by women under 18 should decline to 20 percent. (http://www.usaid.gov/our_work/global_health/pop/) Neglected Tropical Diseases (NTDs): Reduce the prevalence of seven NTDs by 50 percent among 70 percent of the affected population, and eliminate onchocerciasis in Latin America by 2016, lymphatic filariasis globally by 2017, and leprosy. (http://www.neglecteddiseases.gov/)

GHI Plus The GHI has launched an intensified effort in eight "GHI Plus" countries that receive additional technical, management, and financial resources to accelerate the implementation of GHI, including integrated programmatic interventions and investments across infectious diseases, maternal and child health, family planning, and health systems-related activities. The Health Finance and Governance Projects support to GHI Plus countries will contribute to future lessons learned which are intended to inform future decision-making regarding the best use of programmatic inputs across all USG agencies and partners. The project will also support the goals of programmatic accountability and sustainability through robust monitoring and evaluation. Presidents Emergency Plan for AIDS Relief (PEPFAR) Under PEPFAR, the USG recognizes that strengthened health systems and an enabling health policy environment are critical to achieving its goals. PEPFAR has contributed substantially to strengthen and extend health systems in such areas as information, service delivery, commodities logistics, laboratory services, and human resources. Lack of health capacity is cited by PEPFARs authorization legislation for Phase II as an important constraint to transition toward greater sustainability of PEPFARs achievements. Hence, capacity building and improved harmonization are stated objectives under PEPFARs Phase II, consistent with a declared strategy of linking investments in HIV/AIDS to the broader goals of strengthening health systems and infrastructure, and integrating HIV/AIDS programs with other health or development programs (Tom Lantos and Henry J. Hyde United States Global Leadership Against HIV/AIDS, Tuberculosis, and Malaria Reauthorization Act of 2008--P.L. 110-293). PEPFAR now emphasizes the incorporation of health systems strengthening goals into its prevention, care and treatment portfolios, providing an opportunity for country programs to be more strategic in their approach to health system strengthening and apply a more comprehensive perspective. As a component of the GHI, PEPFAR is carefully and purposefully integrated with other health and development programs and often acts as a platform for GHI coordination. Smart Integration and Best Practices at Scale in the Home, Community and Facilities (BEST) BEST is an action plan that will be the principal mechanism in USAID-supported programs for contributing to the GHIs goals for family planning, maternal and child health, and nutrition (FP/MCH/N). It was launched with the recognition that despite our knowledge of high-impact interventions, coverage remains unacceptably low. It assists countries to implement smart integration in key areas where it makes technical, financial and cultural sense. Consultations with relevant USG agencies and other donors are expected to yield more integrated approaches to assisting partner countries in executing their national health plans.Page of 110

Partnership for Growth Partnership for Growth (PFG) is a partnership between the United States and a select group of countries to accelerate and sustain broad-based economic growth by putting into practice the principles of President Obamas September 2010 Presidential Policy Directive on Global Development. It involves rigorous joint analysis of constraints to growth, the development of joint action plans to address these constraints, and high-level mutual accountability for implementation. One of PFGs signature objectives is to engage governments, the private sector and civil society with a broad range of tools to unlock new sources of investment, including domestic resources and foreign direct investment. By improving coordination, leveraging private investment, and focusing political commitment throughout both governments, the Partnership for Growth enables partners to achieve better development results. C. Program Purpose The purpose of the Health Finance and Governance Project is to increase the use of priority health care services, including primary health care services, by partner countries populations through improved governance and financing systems in the health sector. Priority health services are described in Section I.B. Partner countries health systems are constrained from delivering intended results by inefficient use of resources, weak health governance structures, and ineffective operations. Under this project, partner countries will increase domestic resources for health care, manage those resources more effectively, and increase the efficiency of purchasing decisions. Improved governance of the health sector will occur through improved partner country capacity in stewardship, increased quality engagement of civil society and private sector, and stronger systems of strategic planning and management. The project will support innovative and catalytic activities to advance health systems priorities in finance and governance and support partner countries efforts to enhance the relevance and responsiveness of their health systems to their populations needs. D. Statement of Expected Results The Health Finance and Governance Project will generate measurable results that demonstrate improved health systems that are clearly linked to health outcomes. This section of the Funding Opportunity Description discusses the intermediate results (IRs) and sub-intermediate results (subIRs) that will combine to support achievement of the project purpose. Under each sub-IR is presented a list of illustrative results and illustrative activities that are suggestive but not comprehensive in nature. (See Annex B: Health Finance and Governance Project Results Framework) It is expected that work in all the IRs will be necessary to achieve the project purpose. The percentage of time devoted to individual intermediate results will vary by context and by country and will likely change over the course of the project. Each country's health system priorities will determine the scope of work and the appropriate HSS intervention within the IRs. As such, the successful applicant will need to be prepared to adapt to individual and changing partner country health system contexts.Page of 110

Intermediate Result 1: Improved financing for priority health services The financing function in health serves two primary purposes: to make sufficient resources available that people can access services when they need them; and to protect people from impoverishment due to catastrophic health spending. To achieve these purposes, strong health systems mobilize adequate resources, effectively pool and manage resources to promote equity, and allocate resources both equitably and efficiently. Evidence indicates that development assistance for health can crowd out domestic public 2 spending on health in recipient countries . Developing countries with higher incomes have higher total health expenditures. Among other strategies, USAID works to promote universal health coverage to help countries manage increases in total health expenditure while maintaining out-of-pocket expenditure at acceptable levels, and providing equitable access health services to poor and marginalized populations. Providing technical assistance for health financing is complicated, and closely linked to the governance and service delivery functions of the health system; a nuanced approach is required. Cost containment and health financing mechanisms should not sacrifice quality. Indeed, improving service quality can help to contain costs by encouraging patients to seek care at less input-intensive service delivery points such as clinics or health posts. Administration and operation of peripheral facilities can be made more efficient and such facilities are important to maintain and promote service equity. Sub-Intermediate Result 1.1: Financing of health from domestic sources increased Globally, development assistance for health (DAH) has more than doubled over the past decade, to $27.7 billion in 2011, though that growth has slowed considerably with economic recession 3 among donor countries . The same study estimates that in developing countries, on average, $0.56 of public spending on health is redirected to other priorities for every dollar received in DAH. The net result is an increase in health spending in developing countries, but there is concern about crowding out domestic spending on health. Needed are ways for DAH to leverage developing countries fiscal space for health. Increases in domestic health spending can be gained through policy dialogue and advocacy to recapture shares of domestic budgets for the health sector, and through strategies that mobilize additional resources. While there is need to reduce out-of-pocket expenditure at the point of service, more resources for health may be mobilized from private sources through the organization of efficient insurance schemes and innovative financing mechanisms in partnership with the private sector. Examples of results under this sub-IR include: Understanding of health sector resource flows enhanced among partner countries, including for priority health services

2

See http://www.healthmetricsandevaluation.org/publications/policyreport/financing globalhealth2011 continuedgrowthmdgdeadlineapproaches. 3 See http://www.healthmetricsandevaluation.org/publications/policyreport/financing globalhealth2011

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continuedgrowthmdgdeadlineapproaches.

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Increased share of partner countries domestic budgets spent on health Strengthened partner country capacity to leverage private sector resources for service delivery

Illustrative Activities: Collaborate with and provide analytical support to Partnership for Growth to increase fiscal space for health Develop capacity of countries to implement national health accounts, including subaccounts for priority health services Analyses of fiscal space and tax policy to develop, improve and implement innovative financing mechanisms for health Provide technical support to Ministries of Health to work more effectively with heads of state and Ministries of Finance for increased domestic spending on health Provide analysis to and collaborate with other USAID health projects, development partners, and other relevant actors to leverage support for health policy advocacy for domestic health budgets Sub-Intermediate Result 1.2: Financial barriers that inhibit access to priority health services reduced Even with increased financing for health, many poor people will face financial costs that prevent their access to priority health care services or lead to catastrophic financial loss for their households. These barriers can take the form of formal or informal user fees, payments for drugs, or costs for transportation. Many countries use some form of user fees to help finance the health system or reduce moral hazard, i.e. to mitigate excessive consumption of free health services. Even when user fees are abolished, it is not clear that the poor benefit as much as they could. Health workers often request monetary remuneration from clients, even in the public sector, or if drugs and equipment are unavailable, clients may be asked to buy products in the private sector for use in facilities. When out-of-pocket expenditures for necessary services are high, they can force families into poverty. The WHO estimates that out-of-pocket spending in the range of 1520 percent of total health expenditure will control the incidence of impoverishment, but that 33 4 of the lowest income countries have out-of-pocket expenditure of more than 50 percent. Examples of results under this sub-IR include: Increased participation in risk pooling arrangements that reduce out-of-pocket expenditures and prevent catastrophic health care expenditure Increased use of rational incentive structures for delivery of priority services Increased use of demand-side financing mechanisms to alleviate bottlenecks caused by out-of-pocket costs of service utilization Illustrative Activities: Training and technical assistance for design of national or targeted insurance schemes, including social insurance schemes Costing of proposed benefits packages44

See http://www.who.int/whr/2010/en/index.html.

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Pilot testing of targeted insurance benefit packages Collaborating with other development partners to provide technical assistance and analysis for developing, implementing, monitoring, and evaluating supply and demand side incentive structures for priority health services, including preventative and primary health care services

Sub-Intermediate Result 1.3: Increased efficiency of health sector resource allocation In the context of constrained resources it is imperative that efficiency be realized in the delivery of health care services. As health services coverage increases, policy makers and other stakeholders may face difficult choices regarding the distribution of services to the population and across health care providers. As insurance coverage increases, these decision makers will face difficult choices between benefits and payment. They need information to make good choices. Health care providers need to learn to be more efficient while providing high quality services and be motivated accordingly. Where resources are available, budgets may not be evidence-based or capacity for budget execution may be limited. All countries benefit from information that helps them to determine health service and population priorities, and then to direct resources accordingly. A significant challenge will be to allocate resources in a way that promotes efficiency, equity and quality at once. In some cases it may be more efficient to concentrate services in large facilities in densely populated areas, but such strategies can deny access to priority health services for people in rural and remote areas. Ensuring quality of care at the periphery can help to promote utilization of preventive primary care services that help to avoid the need for costly care at more input-intensive points of service. In addition, there is need to better segment the health care market in some countries such that wealthier households pay progressively for health care expenses, allowing greater allocation of public resources for the poor and marginalized through both public and private sector health care providers. In this regard, private sector plays a role in servicing higher level market segments, and government can play a role in partnering with private sector to incentivize targeted services for the wealthier segments, in order to effectively and efficiently use precious public resources for the poor. Examples of results under this sub-IR include: Increased use of economic evaluation to inform programming options and technology choice Increased use of evidence-based health worker performance schemes Increased efficiency of budget execution among state health agencies, NGOs and CSOs Increased equity in budget allocation to reach the poor and underserved in partner countries Illustrative Activities: Cost-analysis and cost-effectiveness analysis to support resource allocation and other policy decisions Capacity building for the budget and purchasing processes at national and subnational levelsPage of 110

Technical assistance to develop strategies, including smart integration, that efficiently extend services to the poor and underserved Provide market segmentation analysis for improved efficiencies in public sector investments for priority health services for the poor and marginalized. Analytical support to better understand policy trade-offs regarding breadth and depth of coverage

Intermediate Result 2: Health governance capacity of partner country systems strengthened The effectiveness of priority health interventions is often limited by weak or ineffective governance structures within the health system and as part of broader partner country systems, including health sector reform issues or broader political concerns. Effective health governance means effectively managing health system resources, measuring performance, and ensuring meaningful stakeholder participation in ways that promote strong health outcomes. It also means providing necessary public health goods and services in a way that is transparent, accountable and equitable. Effective health governance interventions should enhance partner country capacity to implement and sustain governance reform, increase efficient use of domestic and internal resources including modalities for both direct financial support and technical assistance and improve access to quality health services. Many key issues are beyond the reach of health sector interventions; however, effective health systems strengthening in the area of governance can tap into synergies and capitalize on opportunities within the broader context of the state. For example, civil service reform is traditionally an area beyond the reach of a strict health intervention, but an effective health system strengthening intervention could support existing partner government efforts toward civil service reform, such as the establishment of performance incentives, to ensure appropriate attention to the health sector. This intermediate result will support improved health systems and country ownership by ensuring an environment of transparency and accountability, supporting improvements in government stewardship and oversight, encouraging partnerships and promoting engagement with the private sector, civil society, and community and other stakeholders. Mixed health systems are a reality in the future of development. Through this result, USAID seeks to build public sector capacity to work effectively as stewards of mixed health systems to deliver integrated, high quality services with equitable and sustainable financing. Sub-Intermediate Result 2.1: Partner countries capacity to manage and oversee health systems at the national, provincial and district level increased Effective health governance requires tools and information to facilitate strategic decisions, policies and plans. The Health Finance and Governance Project will focus on greater dissemination and 5 institutionalization of tools for strategic management, such as National Health Accounts and 6 health system assessments , and improvements to systems that support the5

See http://www.who.int/nha/en/.

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governance function. There is need to build governments ability to apply these tools effectively and employ the results. Governments often have weak or poorly implemented frameworks for regulation and quality assurance in the private sector. To support participatory forms of governance, this result also entails strengthening the ability of governments to work with domestic non-state actors to strengthen health systems. Examples of results under this sub-IR include: Increased adoption of health sector programs and practices that improve equity and increase access to health services Institutional capacity for regulation and oversight of national health system strengthened Strengthened capacity of government for meaningful engagement of civil society and private sector in health sector planning and decision-making Evidence-based tools and frameworks for health governance institutionalized

Illustrative Activities: Technical assistance to build Ministry of Health capacity to conduct National Health Accounts and disseminate results Technical assistance to develop, improve and implement processes for stakeholder engagement at national and sub-national levels Technical assistance for design, implementation, monitoring and evaluation of national strategic plans by Ministries of Health and other relevant ministries Partnerships with USAID projects in management, leadership, human resources for health, and policy support to leverage technical assistance to Ministries of Health and other relevant ministries to train personnel on institutionalization of strategic management tools for improved governance Sub-Intermediate Result 2.2: Capacity of civil society and private sector for meaningful engagement with host country government strengthened A strong demand side in health governance will promote the responsiveness of strategic planning and accountability on the part of government to ensure that strategic plans are realized. Moreover, a large proportion of poor people in developing countries use private sector health 7 providers . Still, governments tend to engage civil society insufficiently and can have weak relationships with private sector providers. While this can be addressed on the supply side by strengthening government capacity to engage civil society and the private sector, civil society and the private sector also will benefit from greater capacity to represent their respective constituents on the demand side. Examples of results under this sub-IR include: Increased capacity of public and private non-state actors to influence decision-making processes in health policy, programming and implementation

6

See, e.g. http://www.healthsystems2020.org/content/resource/detail/528/ and http://www.healthsystemassessment.com/. 7 See http://www.ifc.org/ifcext/healthinafrica.nsf/AttachmentsByTitle/IFC_HealthinAfrica_Final/ $FILE/ IFC_HealthinAfrica_Final.pdf

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Increased public demand for transparency and accountability in health finance and resource tracking Increased participation of private and non-state actors in the development of health sector plans and regulations

Illustrative Activities: Technical assistance to non-state actors to use evidence and build policy advocacy skills to effectively influence health policy development and implementation Develop and improve mechanisms for community links with healthcare facilities for outreach and feedback Partnership with USAID health leadership and government projects to leverage technical assistance resources to implement national dialogue between Ministries of Health, other relevant ministries, private and non-state actors related to national health policy development and implementation Sub-Intermediate Result 2.3: Improved transparency and accountability of partner countries financial policy processes and financial management systems A capable governance structure that is both transparent and accountable is a critical determinant of a strong health system. An effective financial policy development process, for example, is one that is open, participatory and informed by sound economic information. As a best practice, policy makers need to have accurate resource tracking information and this information needs to be publicly available. This results focus is two-dimensional: first, to strengthen supply-side systems of resource tracking and policy development; second, to further develop opportunities for demand-side participation through provision of better resource tracking information and more informed engagement by civil society and private sector. Examples of results under this sub-IR include: Increased public dissemination of economic analyses and resource tracking information Increased participation by civil society/private sector in policy dialogue related to resource allocation and financial management Increased use of health resource tracking, such as National Health Accounts, to inform health policy

Illustrative Activities: Strengthening government accountability systems, including monitoring and evaluation, and systems for client feedback Strengthen institutional capacities for data analysis and utilization to support planning and management, and ensuring transparency in these processes Technical assistance to develop and make use of national resource tracking systems that include information from private and NGO health care providers Analysis of national health care utilization and access data regarding primary health care to inform policymaker decisions on equitable budget allocations Technical assistance to publicly disseminate information on health resource allocation, including resources for primary care and essential health services to poor and marginalized populationsPage of 110

Intermediate Result 3: Improved country owned systems in public health management and operations Systems in public health management support the development, implementation, and monitoring and evaluation of strategies, policies, and provision of health services. This includes preventative and curative services, and support for the protection and promotion of health to achieve key outcomes. A strong public health management system will provide the supportive operations mechanisms needed to ensure effective implementation, strengthen the key skills necessary to build and maintain solid health institutions, and gain and sustain health outcomes. Effective administration and management systems are a critical part of USAID Forward and the Global Health Initiative as these systems are necessary components to strong country ownership and sustainability. While most partner countries have basic public management platforms, these countries are working to enhance the capabilities of these platforms through the introduction of innovative technologies and institutionalization of evidence-based practices. This result will support the development and growth of institutions and capacity-building across a range of needs in health sector management systems that will, in turn, support greater achievements in health outcomes. Sub-Intermediate Result 3.1: Country institutions develop administrative processes and structures that are more efficient, more equitable, and better equipped to deliver quality services Effective health management and administration systems are key to optimizing implementation of priority health interventions and achieving health outcomes. Ineffective, inefficient administrative processes limit partner countries ability to operationalize strategic plans and achieve results. Some constraints may be overcome through leadership and knowledge transfer, while other will require longer-term investment in process change management. For example, partner countries may require skills-building in business planning, market analysis, resource mobilization or proposal development. Others may be working to develop more efficient management policies and processes between the national and community level. This result will support partner countries efforts to institutionalize systems to manage domestic and international programs, monitor and evaluate, achieve results and feed those results back into policy and planning processes, national guidelines and operating procedures. Examples of results under this sub-IR include: Strategies to address gaps and bottlenecks in country-owned administrative systems identified, documented and implemented Partner countries capacity to troubleshoot existing administrative and management systems increased at national and subnational levels

Illustrative Activities: Analysis of weaknesses in and opportunities to strengthen management and administrative processes and systems Establish and strengthen standard procedures and norms for operation of health facilitiesPage of 110

Technical assistance to improve implementation and monitoring of established management and administrative systems Strengthen institutional capacities for data analysis and utilization to support planning and management, and ensuring transparency in these processes Technical assistance to develop or strengthen health services delivery reporting, including utilization of services by poor and underserved populations, to inform management and decisions

Sub-Intermediate Result 3.2: Public financial management systems improved in partner countries to become more transparent and meet international standards of fiduciary soundness The objectives of public financial management (PFM) systems are to achieve fiscal discipline, the allocation of resources to priority needs, and efficient and effective allocation of public services. PFM is an essential component of health finance, governance and development. The international community has established a collective effort, the Public Expenditure and Financial Accountability (PEFA) Program, to address PFM needs in developing countries. The goals of the PEFA Program are to strengthen the ability of partner countries and donor agencies to: (i) assess the condition of country public expenditure, procurement and financial accountability systems, and (ii) develop a practical sequence of reform and capacity-building actions (http://www.pefa.org). It is critical to achieving health outcomes, improving health policy, and increasing effective use of donor and domestic resources. In order to utilize partner country systems for direct US government assistance, they must meet minimum standards of fiduciary soundness and demonstrate capacity to manage both domestic and donor resources with efficiency, transparency and accountability. Support to this result will include capacity-building to budget and financial processes in host country systems, and strengthening host country systems to meet international PFM standards. Examples of results under this sub-IR include: Partner country systems meet donors minimum standards to receive direct assistance Partner country system capacity increased to meet international PFM standards

Illustrative Activities: Analysis of existing PFM systems and identification of gaps to achieve international standards Technical assistance provided to Ministries of Health, Ministries of Finance and Treasuries to develop and implement international standards of PFM Technical assistance to develop publicly available reports on the use of donor and public sector resources for health Technical assistance to create electronic/web-based accounting and reporting systems for public, private, or NGO health service delivery points Sub-Intermediate Result 3.3: Partner countries use high-functioning systems to efficiently manage, deploy and incentivize the health workforce Human resource management systems must function efficiently in order to effectively recruit and retain a high functioning health workforce. Partner countries often have difficulty in utilizingPage of 110

existing management systems to effectively manage the recruitment and deployment processes for new staff, and experience difficulty in managing financial and compensation packages for existing staff. Additionally, when payroll and benefits systems are inefficient or when banking and disbursement systems are ineffective, retention is negatively impacted. This result is expected to support partner countries in strengthening and sustaining well-functioning systems that support effective human resource management. This project is expected to complement and support currently available USAID mechanisms such as the CapacityPlus Project, while paying particular attention to the human resource financing and administrative systems that most significantly impact productivity and efficiency within the health system. Examples of results under this subIR include: Partner country systems enhanced to support more effective and more efficient management of human resources Evidence-based practices in human resource financing and administrative systems institutionalized Human resources in the health sector increased in poor and remote geographic areas in partner countries Illustrative Activities: Development and pilot testing of financial and non-financial incentive packages to enhance deployment and retention, particularly for services providers in rural and remote areas Technical assistance to build institutional and individual capacity for financial management of human resources Provide technical assistance to develop and pilot work productivity standards and conditions of service health care professionals Technical analysis to support task shifting strategies that enhance delivery of services, access and coverage. Sub-Intermediate Result 3.4: Increased capacity of partner countries to employ effective health sector strategy and planning systems including budgeting, payroll and logistics Constraints to institutional and human capacity limit partner countries ability to set and achieve goals, such as the Millennium Development Goals (MDGs), receive external funding, raise domestic resources, translate those resources into efficient operations, and then translate those operations into results. Successes in health sector planning in HIV/AIDS, Malaria, and other health areas have demonstrated the positive impact of sound planning systems on effective resource management. This result will support new and continuing efforts in partner countries to develop standards of practice for health sector planning systems, and strengthen the capacity of key institutions. This result will also support increased linkages of planning systems to both policy and legislative bodies, civil society and private sector (as articulated in intermediate result 2) as well and administrative and management functions (intermediate result 3.1). Examples of results under this sub-IR include: Evidence-based, strategic planning for health systems increased

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Improved translation of strategic planning for health systems into national, provincial and district level operations. Enhanced effectiveness of strategy and planning systems contributes to improved resource efficiencies and health outcomes

Illustrative Activities: Document and disseminate successful models of health sector strategy and planning systems Technical assistance to develop and execute national and subnational government strategic plans Capacity building for identified results at subnational levels in decentralized settings Technical assistance to health facilities in budgeting, managing revenues and expenditures, and program planning Partner with USAID health policy advocacy projects to provide technical assistance to Ministries of Health to share information on health sector strategies with Ministries of Finance and local legislative bodies to garner support for health systems financing Intermediate Result 4: Improved measurement of global health systems progress through increased use of evidence-based tools and innovative measurement techniques This result emphasizes contributions to the practice of health systems strengthening efforts globally, and improving the capacity to practice health systems strengthening in USAIDs partner countries. In the context of an important and growing health systems research agenda, and with limited research funding, the Health Finance and Governance Project will need to be strategic and innovative in its approach. Local and regional capacity needs to be built to conduct research in developing countries. In collaboration with other development partners, the project will develop, test and promulgate metrics and standards for health system strengthening. Sub-Intermediate Result 4.1: Global health systems research and development agenda advanced A growing global health systems research agenda is emerging. Much is needed to increase the evidence base regarding linkages between health system strengthening activities and health outcomes. Much is needed to understand how to mobilize and array health system inputs, such as human resources. Much is needed to better understand how to organize and support health services. But research funding is limited. Contributions from the Health Finance and Governance Project will need to be strategic in nature, and designed to complement and support the overall results package. The projects research agenda must also be creative. It must employ operations research and program and impact evaluation as actively and as rigorously as experimental research. Examples of results under this sub-IR include: Project-level research agenda developed in coordination with global development partners Health systems research methodologies improved and tested Evidence base for health system investments increased and appliedPage of 110

Illustrative Activities: Analyze how health system strengthening initiatives, such as increased and more equitable budget allocation for preventive care and priority health services, affect health outcomes Analyze the effect of improved transparency of health finance and management, including participation of civil society on health care quality Evaluate performance based incentives for health care managers and utilization of preventive care and priority health services Provide administrative and technical support for evidence summits on best practices for health system strengthening Provide technical leadership and participation in HSS research forums and working groups with development partners and countries Sub-Intermediate Result 4.2: Institutional and human capacity in health systems research increased There is a broad spectrum of research that can be applied in many settings. All levels of the health system participate in research of some form. Since the aim of research on health systems is to inform key questions of health system strengthening, then partner countries must also have access to research capacity. Research and evaluation undertaken through the Health System Finance and Governance Project will be conducted in partnership with local or regional institutions, and will employ training, twinning and organizational development techniques to strengthen local capacity for research. International partnerships to implement health systems research will serve the additional purpose of increasing resources in developing countries to address key research questions. Examples of results under this sub-IR include: Increased use of local expertise for research functions Joint health systems research increased with local health and research institutions, including local universities Increased partner country resources for research and monitoring and evaluation

Illustrative Activities: Facilitate university partnerships to strengthen capacity and health system strengthening research Conduct workshops in health systems research to develop fundable projects and associated research proposals Establishment of partnerships to build capacity among local research institutes and universities Build capacity of research regulatory agencies to understand and stimulate health systems research Sub-Intermediate Result 4.3: Health systems performance measurement tools and indicators developed and utilized Distinct from the health system research agenda is the need for agreed-upon indicators and measurement tools. These will help countries to benchmark their health systems and monitorPage of 110

progress. There is currently a wide range of indicators that have been proposed for these purposes, but few have been tested extensively and the global community lacks agreement on a finite set of indicators that can be employed effectively. This result is intended to promote convergence in the global dialogue regarding indicators and measurement for health systems and health system strengthening. Examples of results under this sub-IR include: Increased number of and capacity for health system strengthening impact evaluations Strengthened evidence base for health system strengthening programming Strengthened donor coordination for monitoring health system strengthening investments

Illustrative Activities: Health system strengthening monitoring tools applied to USG funded programs Contribution to the evidence base for health system strengthening through documentation and dissemination of impact evaluations and best practices of health systems strengthening programming. Evaluation of disease-specific investments on health system strengthening outcomes Participate in the organization and facilitation of regional meetings in conjunction with multilateral and bilateral donor and research organizations on the development of a set of key health systems strengthening indicators Conduct capacity-building workshops to promote methodology uptake and utilization Sub-Intermediate Result 4.4: Standards for health system strengthening activity design developed and implemented across USAID-supported programs USAID has a long history in health system strengthening. Demand for technical assistance and programming in health system strengthening is increasing to meet GHI and PEPFAR country ownership goals. The Health Finance and Governance Project will help to develop assessment methods and standards for health system strengthening activity design that may be adopted by USAID for use by its field programs. This will involve research to identify the key characteristics of successful health system investments across the core functions of the health system and will promote capacity building for improved programming. Examples of results under this sub-IR include: Expanded evidence-based health system strengthening programming, particularly for finance and for governance Increased USAID staff capacity for health system strengthening programming Strengthened USAID capacity for monitoring and evaluation of health system strengthening activities Expanded application of country-led health systems assessment (HSA) methodologies Illustrative Activities: Development and application of evaluation guidelines for USAID health system strengthening programming Conduct capacity building activities to improve design, implementation, monitoring and evaluation in USAID-supported programs Develop and test country-led health systems assessment (HSA) methodologiesPage of 110

E. Core Operating Principles The following core operating principles are in alignment with the GHI and govern the overarching framework within which the Health Finance and Governance Project will work. They also provide the operational parameters that will be critical for the programs success while providing the frame of reference against which success will be evaluated. The program shall incorporate these principles as decisions are made regarding the modalities of implementation for proposed activities. Support country-led coordination and the underlying goal of country-ownership by working with partner country governments and other relevant governing bodies, including civil society organizations, to build their capacity to dialogue effectively with each other and donors, cooperating agencies and other stakeholders on national health priorities, proposed solutions and strategies, and resource requirements. This includes donor mapping, developing a shared understanding of health system strengthening needs, supporting collaborative work planning, and contributing to country-led coordination efforts. Build on and strengthen existing partner country systems, existing networks and resources as the norm, to improve acceptance from local governments, counterparts, and development partners, the potential for sustainability, the scalability of health programs, and cost effectiveness from both a financial and human resource perspective. This will include the integration of the private sector into the development of locally relevant strategies. Support integration, where programmatically sound, to minimize redundancy and waste and optimize use of existing resources. In this regard, specific health systems issues to be addressed may require adjusting key finance policies, including the private sector, assessing institutional and/or human capacity to support integration, making corresponding improvements, and supporting the development of human, information and financial resource management systems.

Build and strengthen the capacity of local organizations to address both immediate and long-term sustainability of public and private systems. The project will identify promising organizations to strengthen their governance, technical competence, financial systems, and monitoring and evaluation capabilities such that they can become providers of technical assistance and training as well as implementers of USG-supported programs. If found to be cost effective, they could also be utilized to perform technical operations. Harmonize tools, approaches and metrics, and build on existing tools where they exist to avoid duplication of effort, reduce redundancy and the burden on partner countries, support coordination, facilitate management and implementation activities, assure information compatibility, and promote efficiency in the use of resources to strengthen health systems.

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Share knowledge and information among projects, agencies and other partners to create the evidence base required to validate conceptual frameworks and operational models for measuring and benchmarking health system performance and strengthening. Effective knowledge management will be a key activity throughout the life of the program, requiring a comprehensive strategy for sharing reports and work plans, studies, lessons learned, best practices, and success stories on an on-going basis with USG agencies, implementing organizations, partner country governments, other donors, multilateral organizations, and international stakeholders.

F. Funding Principles This section provides the Applicant with information on the way USAID provides funding for global health work and key areas of focus of each funding source. For this project, there will be two sources of funding: core funding provided from USAID/Washington sources and field support provided from USAID field Missions. Field support is a funding process through which USAID field Missions use Mission-based funding sources to buy-in to centrally-based projects to implement country-level activities. Activities funded by field support are expected to support partner country health systems and to be aligned with that countrys public health priorities as part of the USAID mission-directed work. Field support, as used in this funding context, is different than support to the field, as described below. USAID Mission staff and the Agreement Officers Representative (AOR) will be involved with the development of work plans in response to field support. Appropriate use of USAID/Washington core funds under the project must align with partner country health systems, as described above, while adhering to three essential principles discussed below: global technical leadership, research and innovation, and support to the field. The AOR and other USAID/Washington staff, as appropriate, will be involved in the development of work plans in response to core funding. Global technical leadership: Establishing and maintaining global technical leadership in health systems will be key principle for the Health Finance and Governance Project. A primary objective will be to assist USAID in its role of influencing global health initiatives to adopt proven practices, tools, approaches, and interventions to improve health systems, thereby also improving aid effectiveness. Illustrative roles for the project include: Support a continuing and enhanced USAID leadership role in strengthening health system performance by providing technical guidance and direction related to health finance, operations and governance, and in defining and promoting evidence-based approaches in health system strengthening. This will include supporting policy dialogue and harmonization on priority technical issues and facilitating coordination among donors, multilateral organizations, and implementing partners. Maintain effective operational relationships with global partners and identify new opportunities for partnership. Global partners include but are not limited to: other USG and USAID cooperating agencies and contractors, international and developing country partner organizations such as WHO, World Bank, the Global Fund, GAVI, thePage of 110

Rockefeller Foundation, the Bill and Melinda Gates Foundation, other bilateral donors, private voluntary and non-governmental organizations, foundations, universities, and other U.S. and host country government agencies. Identify, document, disseminate and promote evidence-based practices and lessons learned in program implementation for all Health Finance and Governance Project technical areas, as well as related benchmarking approaches to systematically measure and assess health system performance.

Document and disseminate evidence-based practices that promote equitab