FOR OFFICIAL USE ONLY Report No: PAD3170 INTERNATIONAL DEVELOPMENT ASSOCIATION PROJECT APPRAISAL DOCUMENT ON A PROPOSED CREDIT IN THE AMOUNT OF SDR 21.8 MILLION (US$30 MILLION EQUIVALENT) TO THE INDEPENDENT STATE OF PAPUA NEW GUINEA FOR AN IMPROVING ACCESS TO AND VALUE FROM HEALTH SERVICES IN PNG: FINANCING THE FRONTLINES PROJECT April 1, 2020 Health, Nutrition & Population Global Practice East Asia And Pacific Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective January 31, 2020) Currency Unit = PNG Kina (PGK) 2.39 PGK = US$1 1.37695 US$ = SDR 1 FISCAL YEAR January 1 - December 31 Regional Vice President: Victoria Kwakwa Practice Group Vice President: Annette Dixon Country Director: Michel Kerf Regional Director: Daniel Dulitzky Acting Practice Manager: Daniel Dulitzky Task Team Leader: Aneesa Arur ABBREVIATIONS AND ACRONYMS ADB Asian Development Bank ANC Antenatal Care CERC Contingent Emergency Response Component CPF Country Partnership Framework DALYs Disability-adjusted Life Years DFAT Department for Foreign Affairs and Trade DHS Demographic and Health Survey DLIs Disbursement Linked Indicators DNPM Department of National Planning and Monitoring DP Development Partner DPT-3 Diphtheria Pertussis Tetanus 3 DSTB Drug Susceptible Tuberculosis EAP East Asia and Pacific EEP Eligible Expenditure Program ESMF Environmental and Social Management Framework eNHIS Electronic National Health Information System GDP Gross Domestic Product GHG Greenhouse Gas GoPNG Government of PNG GRS Grievance Redress Service HCW Health Care Waste HCWM Health Care Waste Management HFG Health Function Grant HIC Healthy Islands Concept HIV/AIDS Human Immunodeficiency Virus/ Acquired Immunodeficiency Syndrome HWMP Health-care Waste Management Plan IDA International Development Association IFMS Integrated Finance Management System IMPACT Health The short name for Improving Access to and Value from Health Services in PNG: Financing the Frontlines project; also ‘the Project’ IPF Investment Project Financing IPP Indigenous Peoples Plan IVA Independent Verification Agent KRA Key Result Area LiST Lives Saved Tool LMICs Lower Middle-Income Countries MDR Multidrug-resistant MMR Maternal Mortality Ratio MoU Memorandum of Understanding MTDP Medium Term Development Plan NCD Non-communicable Disease NDOH National Department of Health NGO Non-governmental Organization NHP National Health Plan NHPCS National Health Policy and Corporate Services OP Operations Policy OPCS Operations Policy and Country Services PASA Program of Advisory Services and Analytics PCU Project Coordination Unit PDR People’s Democratic Republic PFM Public Financial Management PGAS PNG Government Accounting System PGK Papua New Guinea Kina PHA Provincial Health Authority PHC Primary Health Care PHCPI Primary Health Care Performance Initiative PNG Papua New Guinea POM Project Operational Manual PPG Project Preparation Grant PROP Pacific Regional Oceanscape Program RGAP Regional Gender Action Plan RMNCH-N Reproductive, Maternal, Neonatal and Child Health and Nutrition SEF Stakeholder Engagement Framework SIP Service Improvement Program SPAR Sector Performance Annual Review STEP Systematic Tracking of Exchanges in Procurement TA Technical Assistance TB Tuberculosis THE Total Health Expenditure U5MR Under-five Mortality Rate UHC Universal Health Coverage WASH Water, Sanitation and Hygiene WHO World Health Organization XDR-TB Extensively Drug-Resistant Tuberculosis The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) TABLE OF CONTENTS DATASHEET ........................................................................................................................... 1 I. STRATEGIC CONTEXT ...................................................................................................... 7 A. Country Context................................................................................................................................ 7 B. Sectoral and Institutional Context .................................................................................................... 7 C. Relevance to Higher Level Objectives............................................................................................. 16 II. PROJECT DESCRIPTION.................................................................................................. 18 A. Project Development Objective (PDO) ........................................................................................... 18 B. Project Components ....................................................................................................................... 18 C. Project Beneficiaries ....................................................................................................................... 24 D. Results Chain .................................................................................................................................. 25 E. Rationale for Bank Involvement and Role of Partners ................................................................... 26 F. Lessons Learned and Reflected in the Project Design .................................................................... 27 III. IMPLEMENTATION ARRANGEMENTS ............................................................................ 28 A. Institutional and Implementation Arrangements .......................................................................... 28 B. Results Monitoring and Evaluation Arrangements......................................................................... 30 C. Sustainability................................................................................................................................... 30 IV. PROJECT APPRAISAL SUMMARY ................................................................................... 31 A. Technical, Economic and Financial Analysis ................................................................................... 31 B. Fiduciary.......................................................................................................................................... 34 C. Safeguards ...................................................................................................................................... 35 V. KEY RISKS ..................................................................................................................... 40 VI. RESULTS FRAMEWORK AND MONITORING ................................................................... 43 ANNEX 1: Detailed Project Components Description ............................................................ 74 ANNEX 2: Implementation Arrangements and Support Plan ................................................. 82 ANNEX 3: Primary Health Care Performance Initiative- Vital Signs Profile and Progression Model ................................................................................................................................. 96 ANNEX 4: Map of the Independent State of Papua New Guinea ......................................... 100 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) DATASHEET BASIC INFORMATION BASIC_INFO_TABLE Country(ies) Project Name Papua New Guinea Improving Access to and Value from Health Services in PNG: Financing the Frontlines Project ID Financing Instrument Environmental Assessment Category Investment Project P167184 B-Partial Assessment Financing Financing & Implementation Modalities [ ] Multiphase Programmatic Approach (MPA) [✓] Contingent Emergency Response Component (CERC) [ ] Series of Projects (SOP) [✓] Fragile State(s) [✓] Disbursement-linked Indicators (DLIs) [ ] Small State(s) [ ] Financial Intermediaries (FI) [ ] Fragile within a non-fragile Country [ ] Project-Based Guarantee [ ] Conflict [ ] Deferred Drawdown [ ] Responding to Natural or Man-made Disaster [ ] Alternate Procurement Arrangements (APA) Expected Approval Date Expected Closing Date 22-Apr-2020 30-Jun-2026 Bank/IFC Collaboration No Proposed Development Objective(s) The development objective is to contribute to increasing the utilization of quality essential health services in Project- supported provinces of the Recipient. Components Component Name Cost (US$, millions) Page 1 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Component 1: Increase service delivery readiness and community-based service 12.40 delivery Component 2: Improve frontline service delivery performance 14.60 Component 3: Project management 3.00 Component 4: Contingent emergency response 0.00 Organizations Borrower: Independent State of Papua New Guinea Implementing Agency: National Department of Health PROJECT FINANCING DATA (US$, Millions) SUMMARY -NewFin1 Total Project Cost 30.00 Total Financing 30.00 of which IBRD/IDA 30.00 Financing Gap 0.00 DETAILS -NewFinEnh1 World Bank Group Financing International Development Association (IDA) 30.00 IDA Credit 30.00 IDA Resources (in US$, Millions) Credit Amount Grant Amount Guarantee Amount Total Amount Papua New Guinea 30.00 0.00 0.00 30.00 National PBA 30.00 0.00 0.00 30.00 Total 30.00 0.00 0.00 30.00 Expected Disbursements (in US$, Millions) Page 2 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) WB Fiscal Year 2020 2021 2022 2023 2024 2025 2026 2027 Annual 0.02 5.34 4.71 7.57 6.54 5.14 0.63 0.05 Cumulative 0.02 5.36 10.07 17.64 24.18 29.32 29.95 30.00 INSTITUTIONAL DATA Practice Area (Lead) Contributing Practice Areas Health, Nutrition & Population Climate Change and Disaster Screening This operation has been screened for short and long-term climate change and disaster risks SYSTEMATIC OPERATIONS RISK-RATING TOOL (SORT) Risk Category Rating 1. Political and Governance ⚫ High 2. Macroeconomic ⚫ Substantial 3. Sector Strategies and Policies ⚫ Moderate 4. Technical Design of Project or Program ⚫ Substantial 5. Institutional Capacity for Implementation and Sustainability ⚫ Substantial 6. Fiduciary ⚫ High 7. Environment and Social ⚫ Moderate 8. Stakeholders ⚫ High 9. Other ⚫ Low 10. Overall ⚫ High Page 3 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) COMPLIANCE Policy Does the project depart from the CPF in content or in other significant respects? [ ] Yes [✓] No Does the project require any waivers of Bank policies? [ ] Yes [✓] No Safeguard Policies Triggered by the Project Yes No Environmental Assessment OP/BP 4.01 ✔ Performance Standards for Private Sector Activities OP/BP 4.03 ✔ Natural Habitats OP/BP 4.04 ✔ Forests OP/BP 4.36 ✔ Pest Management OP 4.09 ✔ Physical Cultural Resources OP/BP 4.11 ✔ Indigenous Peoples OP/BP 4.10 ✔ Involuntary Resettlement OP/BP 4.12 ✔ Safety of Dams OP/BP 4.37 ✔ Projects on International Waterways OP/BP 7.50 ✔ Projects in Disputed Areas OP/BP 7.60 ✔ Legal Covenants Sections and Description The Recipient shall vest the overall Project management and implementation responsibilities in NDOH, and shall establish and maintain, throughout the Project implementation period, a Project Coordination Unit within NDOH, with terms of reference, composition and resources satisfactory to the Association, which shall be responsible for carrying out day-to-day management and implementation of the Project, including, inter alia, supporting coordination, monitoring and evaluation and communication of Project activities, and ensuring compliance with fiduciary and safeguard requirements under the Project. (Sections I.A.1 and I.A.2 of Schedule 2 to the Financing Agreement). Sections and Description The Recipient shall: (a) by not later than six months after the Effective Date, recruit or appoint the following Page 4 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) positions within the Project Coordination Unit: (i) a Project coordinator; (ii) a procurement specialist; (iii) a financial management specialist; (iv) a monitoring and evaluation specialist; and (v) an administrative assistant, each with terms of reference, qualifications and experience satisfactory to the Association; and (b) thereafter maintain such positions throughout the Project implementation period (Section I.A.3 of Schedule 2 to the Financing Agreement). Sections and Description The Recipient shall, prior to the carrying out of any activities under Part 2 of the Project in a Province, enter into a Memorandum of Understanding with such Province’s Provincial Health Authority, under terms and conditions set forth in the DLI Operational Manual and satisfactory to the Association. (Section I.B.1 of Schedule 2 to Financing Agreement). Sections and Description The Recipient shall: (a) by not later than three months after the Effective Date, prepare and adopt a Project Operational Manual, which shall attach, as its annex, a DLI Operational Manual; and (b) thereafter ensure that the Project is carried out in accordance with the Project Operational Manual. (Sections I.C.1 and I.C.2 of Schedule 2 to the Financing Agreement). Sections and Description The Recipient shall, by not later than three months after the Effective Date, appoint, and thereafter maintain throughout the Project implementation period, an independent verification agent, with terms of reference and qualifications satisfactory to the Association, for the purpose of carrying out independent verifications of the status of achievement of DLI Targets in accordance with the verification protocol and procedures set out in the DLI Operational Manual. (Section I.F.1 of Schedule 2 to the Financing Agreement). Sections and Description The Recipient shall prepare and furnish to the Association, by not later than two months after the Effective Date and June 1 of each subsequent year during the implementation of the Project, for the Association’s review and no- objection, an Annual Work Plan and Budget for the Project. The Recipient shall ensure that the Project is implemented in accordance with the Annual Work Plan and Budget accepted by the Association for the respective fiscal year. (Sections I.D.1 and I.D.2 of Schedule 2 to the Financing Agreement). Sections and Description The Recipient shall, by not later than five months after the end of each Year, furnish to the Association reports on the status of achievement of the relevant DLI Targets, including the reports of the independent verification agent, all in accordance with the verification protocol and procedures set out in the DLI Operational Manual. (Section I.F.2 of Schedule 2 to the Financing Agreement). Sections and Description The Recipient shall carry out, jointly with the Association, not later than three years after the Effective Date, or such other period as may be agreed with the Association, a mid-term review of the Project. (Section II.2 of Schedule 2 to the Financing Agreement). Sections and Description By not later than four months after the Effective Date, the Recipient shall complete the selection of the Early Page 5 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Adopter Provinces in accordance with the provisions of the Financing Agreement and the Project Operational Manual. (Section IV.1 of Schedule 2 to the Financing Agreement). Conditions Type Description Disbursement No withdrawal shall be made under Category (2) unless and until the Association is satisfied that the Recipient has: (a) adopted the Project Operations Manual, in accordance with Section I.C of Schedule 2 to the Financing Agreement; (b) furnished evidence satisfactory to the Association in accordance with the verification protocol set forth in the DLI Operational Manual that the Recipient has achieved the respective DLI Targets by its DLI Target Achievement Date as set forth in Schedule 4 to the Financing Agreement against which withdrawal is requested; and (c) complied with the additional instructions referred to in the Disbursement and Financial Information Letter, including furnished to the Association a customized statement of expenditures, in form and substance satisfactory to the Association, documenting the incurrence of Eligible Expenditure Program during the respective Year up to the date against which withdrawal is requested. (Section III.B.1(b) of Schedule 2 to the Financing Agreement). Type Description Disbursement No withdrawal shall be made for Emergency Expenditures under Category (3) unless and until the Association is satisfied that all of the conditions listed in Section I.G.2 of Schedule 2 to the Financing Agreement have been met in respect of the said expenditures. (Section III.B.1(c) of Schedule 2 to the Financing Agreement). Page 6 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) I. STRATEGIC CONTEXT A. Country Context 1. The Independent State of Papua New Guinea (“PNG” and/or “the Recipient”) is a lower-middle income country (LMIC) with a population of over 8 million1. PNG is a predominantly rural country - 86.9 percent of the population lives in rural areas – and given its rugged topography and very poor transport infrastructure2, a large share of the population resides in remote and hard-to-reach areas. 2. PNG’s economy relies heavily on natural resources and it is therefore exposed to the price volatility of international commodities. PNG has a rich endowment of minerals and petroleum, and a high potential for agriculture, forestry and fishing. In 2016, these sectors represented almost half of PNG’s Gross Domestic Product (GDP) per capita (US$2,688) and more than 80 percent of the country’s exports3. In the absence of adequate stabilization measures, PNG has followed a “boom and bust” cycle of high fluctuations in revenues and expenditures driven by changes in global commodity prices. Moreover, approximately 80 percent of Papua New Guineans are directly or indirectly involved in agriculture4. 3. A fragile social, political and environmental landscape have hindered improvements in socio-economic indicators. PNG scores are low on socio-economic development indices such as the Human Capital Index and the Human Development Index and only limited improvements have been achieved on this front over the last decade. Poverty rates remain high, particularly in the rural and remote areas, with 38 percent of PNG’s population living below the international poverty line of US$1.90 per day (2011 US$ Purchasing Power Parity) in 20095. PNG’s ethnographic diversity represents a salient challenge for social cohesion and tribal conflict is an important driver of PNG’s social fragility6 7. Furthermore, PNG’s cultural diversity has influenced the evolution of its political system since independence in 1975. PNG has implemented a system of political decentralization that delegates large responsibilities to lower government levels. Finally, PNG faces environmental risks, such as earthquakes, floods and droughts, that can have severe social and economic impacts8. B. Sectoral and Institutional Context 4. PNG has a significant unfinished agenda on building human capital. PNG, an early adopter of the Human Capital Project, has a Human Capital Index score of 0.38. This means that a child born in PNG will be 38 percent as productive when she grows up as she could be if she enjoyed complete education and full health. PNG’s Human Capital score is below the East Asia and Pacific (EAP) region average (0.62) and is comparable to Sub-Saharan Africa (0.40). 5. Gains in key health outcomes have been slower than expected. PNG did not achieve any of the health-related global Millennium Development Goals. Improvements in key health outcomes in PNG have also been slower than in 1 World Bank, World Development Indicators 2 In 2016, PNG ranked 105 out of 160 in the World Bank’s Logistics Performance Index for infrastructure. With less than 0.5 km of roads per square kilometer of land, PNG has one of the lowest levels of road density in the region. 3 World Bank. 2018. The Independent State of Papua New Guinea - Systematic Country Diagnostic (English). Washington, D.C.: World Bank Group. http://documents.worldbank.org/curated/en/360291543468322518/The-Independent-State-of-Papua-New-Guinea-Systematic- Country-Diagnostic 4 Ibid. 5 Ibid. 6 Ibid. 7 CPIA index 8 World Bank. 2018. The Independent State of Papua New Guinea - Systematic Country Diagnostic (English). Washington, D.C.: World Bank Group. http://documents.worldbank.org/curated/en/360291543468322518/The-Independent-State-of-Papua-New-Guinea-Systematic- Country-Diagnostic Page 7 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) comparator countries. The maternal mortality ratio (MMR) declined from 258 per 100,000 live births in 2008 to 215 per 100,000 live births in 20159. It is significantly higher than the average for the EAP region (59 per 100,000 live births) and the Pacific Islands small states (75 per 100,000 live births). In fact, maternal mortality in PNG is the highest in the Western Pacific region. Reductions in MMR in PNG occurred at a slower pace than in comparator countries. The under-five mortality rate (U5MR), in turn, fell from 68.8 per 1,000 live births in 2008 to 54.3 per 1,000 live births in 201610. U5MR is more than three times higher than average U5MR in EAP and more than twice as high as the average for the Pacific Islands small states. Furthermore, U5MR in PNG is higher than the corresponding figure for LMICs and declines have been slower than in comparator countries (see Figure 1). The drivers of poor health outcomes are discussed subsequently in this document (see paragraph 15). 6. Stunting is a serious economic and public health problem in PNG and an obstacle to realizing the full human potential of PNG’s children. The magnitude of the undernutrition problem is immense: nearly half of all children under five years are stunted, the fourth highest rate in world. The burden of stunting is highest amongst the poorest quintile (55 percent). However, stunting rates amongst the richest quintile are also high (36 percent) indicating that it is a problem across the wealth spectrum. Stunting imposes heavy economic costs on PNG, estimated at 2.8 percent of GDP and significantly exceeding PNG’s budgeted expenditures for both health and education sectors in 2017. Undernutrition also has a well-documented impact on child mortality and cognitive development. Estimates suggest it contributes to as much as 76 percent of under-five deaths in PNG. Research also suggests that undernutrition, specifically undernutrition in the womb, increases the likelihood of cardiovascular disease and diabetes. Figure 1: Under-five mortality rates Source: Economic Update, World Bank (2017) 7. All causes combined, PNG’s burden of disease is much higher than in comparator countries. The PNG population is less healthy than would be expected for a country at its income level. The burden of disease in PNG per capita is the highest in the Pacific region and much higher than the average for LMICs. Furthermore, given the steady increase in the prevalence of non-communicable diseases (NCDs), PNG faces a double burden of disease. In 2017, NCDs represented 54.3 percent of the country’s total Disability-adjusted Life Years (DALYs). Communicable, maternal, neonatal, and 9 World Bank, World Development Indicators 10 World Bank, World Development Indicators Page 8 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) nutritional diseases, in turn, represented 32.6 percent and injuries accounted for the remaining 13.1 percent of DALYs11. Table 1: Burden of disease (2017) Total (per 100,000 NCDs (%) Group 1 (%) Injuries (%) population) PNG 52,604 54 33 13 Pacific Islands 48,605 57 31 13 EAP 27,220 78 12 10 LMICs 35,552 54 37 10 Source: Institute of Health Metrics and Evaluation Note: Group 1 = Communicable, maternal, neonatal, and nutritional diseases 8. The burden of communicable diseases represents a serious public health threat and also risks regional health security. For example, the prevalence of tuberculosis (TB) – including multidrug-resistant (MDR) TB and extensively drug- resistant (XDR) TB, are at levels considered to be a public health emergency by the World Health Organization (WHO). In 2015, the incidence of TB was estimated at 417 per 100,000 population (31,000 cases) and the prevalence rate was 529 per 100,000 population (39,000 cases)12. The prevalence of HIV/AIDS in PNG is the highest in the Pacific region, with 2,800 new HIV infections in 2016. While the coverage of treatment has increased over the last decade, the country faces important challenges in retaining people on life-long treatment13. The number of reported cases of malaria, in turn, experienced almost a nine-fold increase between 2014 and 2017: from 50,309 in 2014 to 432,000 in 201714. In 2018, PNG has had outbreaks of vaccine preventable diseases such as measles, and more recently, a polio outbreak15. 9. Measures of health care access and quality indicate that PNG lags considerably behind comparator countries. The Healthcare Access and Quality index16 offers insights into personal health care access and quality for a range of health service areas. In 2016 PNG ranked 172nd out of 195 countries, in its performance on this index. PNG’s overall score on this index is 31.8 (out of 100), which is considerably below the average for East Asia and the Pacific (EAP) (62.9), the second lowest in the Pacific, and performs comparably to the average for Sub Saharan Africa (31.9). Furthermore, the pace of improvement in the Healthcare Access and Quality index has slowed over time in PNG from 2.19 points per year between 1990 and 2000 to 0.70 per year between 2000-2016. The latter is considerably lower than the average pace of improvement in EAP (2.11 per year) and Sub Saharan Africa (2.24 per year). 10. Coverage of essential health services is low, and coverage/ utilization of many vital services is stagnant or declining. Data on coverage reinforce this picture. PNG’s coverage of essential health services is low for its level of income (see Figure 2). Between 2013 and 2017, utilization of outpatient services in PNG has oscillated between 1.25 and 1.07 outpatient visits to a health facility per person per year17. Under 50 percent of women are covered by modern methods 11 Institute of Health Metrics and Evaluation 12 World Health Organization, 2015. Global tuberculosis report 2015, 20th ed. World Health Organization. https://apps.who.int/iris/handle/10665/191102 13 https://www.unaids.org/en/regionscountries/countries/papuanewguinea 14 PNG Institute of Medical Research, 2018. 15 http://www.wpro.who.int/papuanewguinea/mediacentre/releases/20180725/en/ 16 GBD 2016 Healthcare Access and Quality Collaborators. ‘Measuring performance on the Healthcare Access and Quality Index for 1 95 countries and territories and selected subnational locations: a systematic analysis from the Global Burden of Disease Study 2016’. Lancet 2018:; 391: 2236-71 17 National Department of Health, 2016. Sector Performance Assessment Review. Page 9 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) of family planning, only 52 percent of pregnant women received at least four antenatal care (ANC) check-ups, and immunization coverage rates are extremely low and declining. In 2016, only 34 percent of children under 1 were immunized against measles and 41 percent received the third dose of the pentavalent vaccine. Moreover, national averages hide important differences between provinces. While overall immunization coverage rates are low (the highest coverage rate of measles vaccines is 66 percent), there are provinces where less than one in ten children are covered. This has led to the recent outbreaks of measles and polio. Figure 2: Universal Health Coverage (UHC) service coverage index Source: 2017 Global Monitoring Report, WHO and World Bank (2017) 11. The low coverage of quality Reproductive, Maternal, Neonatal and Child Health and Nutrition (RMNCH-N) services is a key driver of the high rate of preventable deaths for women, and rural women in particular. Low coverage of essential health services is an underlying cause of preventable deaths and the limited availability of services for pregnant women leads to a disproportionally higher share of preventable deaths among women, compared to men, and rural women compared to urban women. Poor access to pregnancy- and birth-related health services is exacerbated for rural women. According to the preliminary results of the Demographic and Health Survey (DHS) 2016-2018, only 47.2 percent of rural women who had a live birth in the 5 years preceding the survey received at least four ANC visits, while the coverage among women in urban areas was much higher (62.9 percent). Similar trends are observed for institutional delivery (51.1 percent among rural women and 85.4 among women in urban areas) and postnatal checkups during the first 2 days after birth (42.1 percent for women in rural areas and 72.2 percent among women in urban areas). The recognition of the critical importance of improving care for pregnant women and reducing maternal mortality led to the formation of a Maternal and Child Health Task Force in 2018. The position paper developed by the Task Force highlights the need to increase the availability and quality of Primary Health Care (PHC) services for pregnant women (particularly family planning and ANC) to close the gender gap in health endowments in PNG. Further, the position paper indicates that community-based approaches – including networks of Village Health Volunteers - need to be strengthened to ensure the uptake of RMNCH-N services. 12. Allocations to the health sector have followed general macro-fiscal trends, partly explained by government’s relatively high share of total health spending. Total health expenditure (THE) as a share of GDP has varied between 2 Page 10 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) percent and 4 percent since 2007. Public health expenditure as a share of GDP has been steady at approximately 2 percent of GDP (see Figure 3). Both THE and public health expenditure have been mostly driven by current spending. Figure 3: Health expenditure as percentage of GDP in selected Countries Source: World Bank Development Indicators database 13. In real per capita terms, however, THE is declining, and is low relative to other LMICs . Given high population growth rates and moderate inflation, real THE per capita has fallen and it is low compared to global standards. In 2014, real THE per capita was US$92, while the average for LMIC countries was US$265 and the average in the EAP region was US$643. Moreover, PNG’s THE should be higher than comparator countries given the high cost of delivering health services in PNG. The higher costs of delivering health services is, in large part, explained by PNG’s remote location, its complex topography, the high share of the population living in remote and hard-to-reach areas and security-related costs. 14. External financing represents a large share of THE and graduation from this support poses risks to the financial sustainability and delivery of critical health services. External financing amounts to approximately one fifth of THE. The share of external funding is disproportionately high for specific programs like immunization, Human Immunodeficiency Virus/Acquired Immunodeficiency Syndrome (HIV/AIDS), TB and malaria. Since PNG achieved LMIC status, graduation from the support of important donors like the Global Alliance for Vaccines and Immunization (GAVI) and the Global Fund has started18. Furthermore, most external funding is channeled outside government systems and parallel service delivery mechanisms are being utilized, particularly since an audit of the Global Fund grants raised concerns about the management of these funds. Since then, non-governmental organizations (NGOs) and private sector agencies implement a large share of donor-funded projects, including those financed with grants from GAVI and the Global Fund. Donor 18It should be noted, however, that given the poor performance of PNG’s health sector and the accelerated increase in the preva lence of priority diseases, development partners are exploring alternative funding mechanisms to extend their support beyond graduation deadlines. Page 11 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) graduation – if not adequately planned for – could lead to further increases in the health financing gap and the interruption of vital externally-financed health services such as immunization whose coverage rates are already low. 15. Given the limited options to increase fiscal space for health, delivering better value from existing public spending on health will be of utter importance. PNG’s macroeconomic outlook suggests that economic growth is unlikely to drive significant increases in fiscal space in the short term. Furthermore, due to a high share of the National Government Budget already going to the health sector, it is unlikely that health will be further prioritized in future budgets. Allocations from provincial internal revenue, in turn, are not systematically monitored and accounted for. While provinces have a clear mandate to fund health service delivery, there is little data on the extent to which they are doing so. Potential fiscal space might be created by adequately leveraging these resources. 16. With limited fiscal space, prioritizing maintenance and recurrent funding for operations will be essential to ensure service delivery and improve the value from public spending on health. Funding flows that directly finance operations need to be prioritized and expenditure on maintenance needs to increase to keep pace with the recent investments in infrastructure financed by the Government as well as Development Partners (DPs). The limited integration of funding sources that cover capital investments [Province and District Service Improvement Programs (SIP)] into the budget process is an important contributor to the limited value for money delivered by public spending on health19. Furthermore, recurrent and capital investments need to be better synchronized to ensure that future infrastructure developments are accompanied by investments in the key inputs required to support the functioning of health facilities (maintenance, medical supplies, human resources, etc.) Over the next 4 to 5 years, the forecast for the health sector budget is for personnel emoluments to increase by 20 percent while goods and services are expected to decrease by 15 percent. This underscores the need to prioritize maintenance and recurrent funding for operations20. Drivers of poor health and nutrition outcomes in PNG 17. PNG’s poor health outcomes reflect a weak health system. These weaknesses are evident at all levels of care, including limited access to health care in a country with difficult geography, poor transportation links and a high degree of cultural diversity. Several factors within the health system contribute to poor health outcomes, among which it is worth mentioning: (i) insufficient and unpredictable funding reaching frontline service providers; (ii) weak and fragmented accountability in a decentralized environment; (iii) inadequate supervision of service delivery; (iv) low availability of critical inputs for service delivery at the facility level; and (v) limited coverage of outreach services and community-based health service delivery in a context where a large share of the population has limited access to functioning health facilities. 18. A weak health system also translates into gaps in the delivery of direct nutrition interventions contributing to stunting. The causes of child undernutrition are multiple and span many sectors. Direct nutrition interventions address the immediate causes of undernutrition, i.e., by improving nutrient intake and reducing burden of illness, and are delivered through health and nutrition programs. Global evidence suggests that scaling up coverage of a package of ten proven cost-effective direct nutrition interventions to 90 percent could achieve a mean 20.3 percent reduction in stunting and a 61.4 percent reduction in severe wasting21. This could make a substantial dent in undernutrition, particularly in countries such as PNG which are far from the 90 percent coverage rate for this proven and cost-effective package of interventions. 19 World Bank. 2017. Papua New Guinea Economic Update: Reinforcing Resilience (English). PNG Economic Updates. Washington, D.C.: World Bank Group. http://documents.worldbank.org/curated/en/150591512370709162/Papua-New-Guinea-Economic-Update- Reinforcing-Resilience 20 Government of PNG Budget 2019 21 Bhutta, Z. A. et al., 2013. Evidence-based interventions for improvement of maternal and child nutrition: what can be done and at what cost? Lancet. 2013 Aug 3;382(9890):452-477. doi: 10.1016/S0140-6736(13)60996-4. Epub 2013 Jun 6. Page 12 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Insufficient and unpredictable funding reaching frontline service providers 19. Budget execution is weak, and funds do not reach their cost centers. The Health Function Grant (HFG) is an intergovernmental fiscal transfer from the central level to provincial governments to cover operational costs at rural health facilities22. Evidence indicates shortfalls in funding at the facility level, revealing important bottlenecks at the provincial and district level. In 2012, 29 percent of health centers and 54 percent of aid posts did not receive any support (in kind or cash) and had to rely solely on out-of-pocket payments23. In 2017, no funds appropriated under the HFG were disbursed. Moreover, in provinces without a Provincial Health Authority (PHA), there are additional bottlenecks at the provincial level, as the HFG is transferred to the PHA via provincial treasuries. Anecdotal evidence suggests that only a share of these funds reaches the health sector. 20. Furthermore, challenges in revenue collection at the central level hinder the predictability of funding flows to the frontlines. Warrant releases and cash disbursements of the HFG are often delayed. In 2016, for example, less than 50 percent of the HFG was disbursed by September, i.e., three months before the end of the fiscal year in PNG. Delays in disbursements undermine managers’ capacity to deliver health services as planned and lead to interruptions in service delivery at the beginning of the year. Weak and fragmented accountability in a decentralized environment 21. Complex institutional arrangements in the health sector challenge the implementation of policies and programs to accelerate improvements in health outcomes. Since PNG’s independence in 1975, the health sector has been progressively decentralized. The creation of new bodies at the subnational level, such the PHAs and the District Development Authorities, was not accompanied by a comprehensive harmonization of the legal framework to transfer responsibilities from the previous institutions holding these responsibilities24. This has created a complicated institutional setting. According to the several laws and regulations governing the health sector, provincial, district and local level government authorities have a role in the delivery of health services. As a consequence of that, these stakeholders receive funding from the national and provincial government to perform these functions. In addition to coordination between the national and subnational levels, managing health services at the subnational level therefore requires coordination between several stakeholders, including the Provincial Administration, the PHA, District Development Authorities and Members of Parliament. 22. Visibility on health spending in PNG is limited, as there is no systematic tracking of spending at the subnational level. For operational spending, in non-PHA provinces it is difficult to ascertain what share of the HFG reaches the sector. Moreover, in both PHA and non-PHA provinces, spending is accounted for using the old PNG Government Accounting System (PGAS) management information system, but there is very limited monitoring and ex-post assessments of how these funds are used. Whereas the National Department of Health (NDOH) has moved onto the Integrated Finance Management System (IFMS). Auditing systems are weak, and only a small number of provinces submit their financial statements following national audit guidelines. For capital investments, accountability is even weaker. There is limited documentation of how capital investments are planned, and there is no mandatory reporting on how these funds are spent. The Department of Implementation and Rural Development is mandated to monitor the use of SIP funds which should finance capital investments, but this is not done systematically and there is no official report describing the activities financed with these funds. According to an Auditor General report, there is limited accountability of those 22 The Health Function Grant covers the 3 health Minimum Priority Areas. 23 Howes, Mako, Swan, Walton, Webster and Wiltshire, 2014. “A Lost Decade? Service delivery and reforms in Papua New Guinea 2002- 2012”. The National Research Institute and the Development Policy Center, Canberra. 24 A legislative review and harmonization is now underway. Page 13 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) charged with responsibility to administer the SIP funds25. 23. Fragmentation in financing sources makes it difficult to track financing flows and get a clear picture of the resource envelope available for the sector. Allocations to the health sector are highly fragmented and there are several institutions responsible for the allocation, use and monitoring of these funds (see Table 2). This fragmentation hinders decision-makers’ capacity to coordinate investment decisions and limits the accountability for the use of these funds. 24. Fragmented accountability for health results. Until the initiation of the PHA reforms, accountability for health results has also been fragmented across entities. The PHA reforms seek to initiate greater accountability for health results by creating a single point of business for health at the province level. PHAs have not been established in all provinces yet, however, and the reforms are being scaled up across the country. Table 2: Allocation, usage and reporting of health financing Budget component Spending unit Capital Operational investment Allocation DOT DNPM National Usage NDOH NDOH Reporting to DOT and DOF DNPM Allocation Provinces, DOT, NEFC Cabinet Provinces, PHAs, Governors, MPs, Subnational Usage districts & facilities DDAs Reporting to DOT, DPLGA, DOF DIRD Source: Economic Update, World Bank (2017) Note: DOT = Department of Treasury; DOF = Department of Finance; NDOH = National Department of Health; NEFC = National Economic and Fiscal Commission; DPLGA = Department of Provincial and Local Government Affairs; DNPM = Department of National Planning and Monitoring; MPs = Open Members; DDAs = District Development Authorities; DIRD = Department of Implementation and Rural Development. Inadequate supervision of service delivery 25. Inadequate supervision led to weak oversight of health service delivery and limited support available to health facility managers. Supportive supervision is rare and more than one third of PNG’s health centers received no supervisory visits in 2016, yet another reflection of delayed and unpredictable flows of operational funding26. Supervision is a key management function that enables decision-makers to design strategies to improve the delivery of health services and to respond to emergencies in a timely manner. The lack of supervision, combined with poor communication infrastructure27, reduce the capacity of the sector to provide the necessary support to the frontlines. Further, this issue was identified by the Maternal Health and Child Task Force as a key driver of high maternal mortality rates. 25 Auditor-General’s Office of Papua New Guinea, 2014. District Services Improvement Program – Report 3. A report on the key findings resulting from the 2012/2013 District audits of expenditure relating to the District Service Improvement Program. Available at: https://pngexposed.files.wordpress.com/2014/10/report_no3_dsip.pdf. 26 National Department of Health, 2016. Sector Performance Assessment Review. 27 While almost 90 percent of the population lives within range of a 2G mobile signal, the actual number of subscribers is still low (less than 50 percent of the population). The penetration of 3G services is much lower, covering only 16 percent of the population. Page 14 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Low availability of critical inputs for service delivery at the facility level 26. Health facilities at the frontlines lack critical inputs and infrastructure needed to deliver basic health services. Shortage of important inputs is particularly acute in government-run lower level facilities. Church-run facilities have comparatively higher levels of readiness, but the constraints span across all types of facilities and most levels of care28. A recent World Bank study that assessed service delivery at upper-primary care level and secondary and tertiary care29 found low infrastructure readiness to deliver health services. Most facilities needed major building repairs and lacked adequate toilets (around 60 percent), stable electricity supply (around 40 percent), and consistent water supply (around 50 percent). The report also found that the availability of basic medical equipment was low: only 11 to 12 percent of upper-level PHC facilities were qualified to safely provide Comprehensive Emergency Obstetric Care and about 40 percent were not equipped to provide Basic Emergency Obstetric Care even though they provided obstetric services. Finally, drug stock-outs were widespread, even at the national referral hospitals. Stock-outs of paracetamol and other basic supplies reflect challenges in supply-chain management and affect provider’s capacity to deliver essential clinical and laboratory services. 27. Poorly maintained infrastructure and equipment and stock-outs also reflect delays in operational funding and poor coordination between different sources of financing. The distribution of medical supplies remains unreliable despite improvements in distribution infrastructure. Medical supplies are procured centrally through NDOH and transported to the provinces. From there, it is the responsibility of provinces to distribute medical supplies to frontline facilities and funds are made available for this through the HFG. However, many provinces have been unable to fulfill this responsibility consistently. Unreliable distribution has led to cases of drugs expiring while in storage, awaiting distribution. Operational funding for infrastructure maintenance is provided through the HFG, an amount that should be sufficient to prevent degradation of existing facilities assuming provincial governments contribute their required co- financing. However, it is likely that provincial governments do not allocate enough co-financing to this activity. Rehabilitation or reconstruction of infrastructure should be funded through Province and District SIP funds but this does not seem to be taking place. 28. There is a severe shortage of human resources; this is compounded by gaps in basic knowledge to deliver RMNCH-N services. In 2016, 44 percent of all positions were vacant. There are fewer than 500 registered medical officers in PNG and their distribution across the country is uneven: while almost one fifth are based in Port Moresby, there are no medical officers in the entire province of Jiwaka. The low number of health professionals is compounded by the fact that a large share of the workforce is ageing. The density of nurses and community-health workers per 1,000 population dropped from 0.49 and 0.66 in 2009 to 0.44 and 0.49 in 2016 respectively30. Moreover, facility survey data points to gaps in basic knowledge to deliver RMNCH-N services, so existing health workers are not performing to potential. Findings from a recent health-facility based survey illustrate this point: the average doctor surveyed was able to correctly answer only 52 percent and 59 percent of questions on tests of basic child and maternal health services respectively. Knowledge scores for Health Extension Officers and nurses were similarly low. Limited coverage of outreach services and community-based health service delivery 29. Outreach has been identified as a Minimum Priority Area, but there has been a stark decline in the number of 28 According to the Service Delivery by Health Facilities in PNG report (World Bank, 2018), the readiness index for level 3 and 4 public sector facilities was 40.3, 48.6 for level 3 and 4 church-run facilities, 84.6 for level 5 and 6 facilities, and 100 percent for the level 7 facility. The index aggregates several readiness dimensions and shows the percentage of readiness indicators that were met on average within each level of care and type of facility. 29 Upper level primary care refers to level 3 and 4 facilities in the National Health Services Standards for Papua New Guinea 2011-2020, issued by GoPNG on June 2011. 30 National Department of Health, 2016. Annual Management Report. Page 15 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) outreach activities conducted since 201031. Rural outreach is key to the delivery of essential health services, such as ANC, and has therefore been included as one of the three health-sector Minimum Priority Areas. The number of outreach services has declined from 42 outreach clinics per 1,000 children under-five in 2010 to 29 in 2017. Furthermore, there are large differences between provinces in the number of outreach activities conducted: while Simbu held 109 outreach clinics per 1,000 children under-five, East Sepik only conducted 632. Survey data indicated that the lack of funding to purchase fuel was the main reason why outreach activities were not conducted as planned33. 30. The Healthy Islands Concept (HIC) is not fully implemented in PNG and the reach of health services at the community level is limited. The Healthy Island Concept was first adopted by all Pacific Islands health ministers in 1997. The HIC has several components, including health, Water, Sanitation and Hygiene (WASH) and gender. The health component consists of a series of interventions (predominantly health promotion) that seek to empower individuals to take an active role in developing their communities. It highlights the value of social capital (how community bonds can impact individuals’ health status) and promotes the organization of committees at the community level to strengthen bottom-up decision-making and accountability mechanisms. The implementation of the HIC in PNG has been quite limited. While no formal evaluation of the coverage and effectiveness of the HIC model has been conducted, health committees have not been established in every district34 and only a limited number of health facilities (28 percent of level 3-4 government run facilities) had community advisory committees35. In addition, health service delivery at the community level is mostly done by Community Health Workers, a health worker cadre, through outreach patrols. NGOs support small-scale community-based models. There is no functional nationwide cadre of Village Health Workers in place. As a result, the reach of health services at the community level is limited. C. Relevance to Higher Level Objectives 31. The operation is in line with the PNG Country Partnership Framework (CPF). The operation contributes to CPF focus area 2 ‘Ensuring more effective and inclusive service delivery, particularly in underserved areas.’ The operation is consistent with the proposed engagement principles of the CPF: (i) World Bank Group corporate commitments: gender, citizen engagement, climate co-benefits; (iii) Portfolio-wide focus on human capital development; and (iv) Responding to governance and institutional challenges across the portfolio. With respect to engagement principle ‘ii’ ‘Maximizing Finance for Development’ the operation seeks to maximize value-for-money from all sources of financing for Health Nutrition and Population services as well as support service delivery at Church-managed facilities. 32. PNG is an Early Adopter of the Human Capital Project. As an early adopter, the Government of PNG has shown high-level support to the human development agenda, and education and health rank high in the country’s development priorities. Moreover, strong alignment between the political leadership and the leadership at the relevant line ministries presents a promising opportunity to implement human capital enhancing programs and interventions. IMPACT Health (the short name for Improving Access to and Value from Health Services in PNG: Financing the Frontlines project) will contribute to addressing key identified bottlenecks to building PNG’s human capital through its alignment with Medium Term Development Plan (MTDP) III priorities. 31 National Department of Health, 2016. Sector Performance Assessment Review. 32 National Department of Health, 2016. Sector Performance Assessment Review. 33 Hou, Xiaohui; Khan, M. Mahmud; Pulford, Justin; Saweri, Olga; Demir, Ibrahim; Haider, Rifat; Ahmed, Shakil. 2018. Service delivery by health facilities in Papua New Guinea : report based on a countrywide health facility survey (English) . Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/269931525699558992/Service-delivery-by-health-facilities-in-Papua-New-Guinea- report-based-on-a-countrywide-health-facility-survey 34 Rural Primary Health Services Delivery Project, 2014. Formative evaluation. Baseline Evaluation Report. 35 Hou, Xiaohui; Khan, M. Mahmud; Pulford, Justin; Saweri, Olga; Demir, Ibrahim; Haider, Rifat; Ahmed, Shakil. 2018. Service delivery by health facilities in Papua New Guinea : report based on a countrywide health facility survey (English) . Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/269931525699558992/Service-delivery-by-health-facilities-in-Papua-New-Guinea- report-based-on-a-countrywide-health-facility-survey Page 16 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) 33. Health has been consistently identified as a development priority in PNG’s policy framework. The Alotau Accord II identifies delivering quality health care services as one of 5 key priorities. Vision 2050, Development Strategic Plan 2030 and National Strategy for Responsible Strategic Development, which define the long-term development roadmap for PNG, also highlight the importance of health and set reaching the top 50 in the World Bank’s Human Development Index ranking as a goal. 34. IMPACT Health supports the priorities identified in the MTDP III (2018-2022). MTDP III emphasizes the importance of managing PNG’s rapid population growth rate and building human capital as an enabler of sustainable and inclusive economic growth. Strengthening service delivery to reach communities and enhancing planning and implementing capacity is also highlighted as a critical growth enabler. The strategies supported through the operation contribute to Key Results Areas (KRAs) 3, 5 and 6. 35. The operation supports KRA 3 ‘Sustainable Social Development’ by contributing to: (i) Improvements in health services and outcomes (KRA 3.2); (ii) Improved health promotion (KRA 3.6); (iii) Improving immunization coverage (KRA 3.8); and (iv) Improving nutrition (KRA 3.9). The health problem statement articulated in KRA 3 relates to the deterioration in health service delivery over time due to an inadequate focus on under-served and rural areas and an over-emphasis on treatment over prevention. It specifically identifies weak health systems, as well as the environmental constraints created by the decentralization process and limited technical capacity at the sub-national levels as vital concerns, and points to the importance of delivering better health services closer to the people. These are the core issues that IMPACT Health focuses on. 36. The interventions financed through IMPACT Health contribute to KRA 5 ‘Improved Service Delivery’ by strengthening the capacity, management and accountability of health service delivery at the province level and below. More specifically, the operation will contribute to improving the capacity of sub-national agencies to respond to needs and development challenges, developing monitoring and evaluation mechanisms to increase the accountability of public institutions, and strengthening partnerships with non-state and community-based stakeholders to improve sub-national health service delivery. 37. Finally, IMPACT Health will contribute to Improved Governance (KRA 6) by supporting improvements in Public Financial Management (PFM) at the sub-national level including improvements in monitoring and evaluation as well as promoting top-down accountability through enhanced supervision and routine reporting and bottom up accountability by strengthening community feedback and response mechanisms. 38. The National Health Plan (NHP) highlights the importance of investing in PHC and establishes the vision for the health sector. The NHP 2011-2020 sets the goal of strengthening PHC for all (“Going back to basics”) and improving service delivery for the rural majority and the urban disadvantaged. The NHP includes eight KRAs to monitor progress towards this goal. These are: (i) improving service delivery; (ii) strengthening partnerships and coordination with stakeholders; (iii) strengthening health systems; (iv) improving child survival; (v) improving maternal health; (vi) reducing the burden of communicable diseases; (vii) promoting healthy lifestyles; and (viii) improving PNG’s preparedness for diseases outbreaks and emergency population health issues. An instrumental policy to the achievement of these KRAs is PNG’s Free Primary Health Care and Subsidized Specialized Care policy. The implementation of the policy, however, has been limited and only a small sum was released to compensate facilities for the foregone revenue. The next NHP (2021- 2030) is under preparation. The emphasis on improving service delivery in rural areas and for underserved urban populations is expected to continue. 39. Strengthening the capacity and functioning of PHAs is a vital element of the Government of PNG’s (GoPNG’s) strategy to improve the governance and management of service delivery at the province level and below. PHAs, which are expected to function as the single point of business for health in a province, have been established in 16 provinces and the model is being rolled out nationally. IMPACT Health will contribute to strengthening the functioning of PHAs. Page 17 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) II. PROJECT DESCRIPTION A. Project Development Objective (PDO) PDO Statement 40. The PDO is to contribute to increasing the utilization of quality essential health services in Project-supported Provinces of the Recipient. PDO Level Indicators 41. The achievement of the PDO will be measured through the following PDO-level results indicators: i. Percentage of Eligible Level 2-4 Health Care Facilities36 in Selected Provinces37 that have achieved a Minimum Service Quality Score* ii. Percentage increase in the number of Outreach Visits in Selected Provinces iii. Percentage increase in the number of pregnant women who have received four (4) or more antenatal care check- ups* iv. Percentage increase in the number of children aged one (1) year who have received Diphtheria Pertussis Tetanus 3 (DPT3) v. Increase in the number of registered Drug Susceptible TB (DSTB) patients on treatment who have been cured* *Given that Integrated Facility Supervision Checklists will prioritize key indicators that contribute to the quality and coverage of essential RMNCH-N services, this PDO level indicator, along with the number of pregnant women who have received four or more ANC check-ups and the gender disaggregated increase in the number of registered DSTB patients on treatment who have been cured, will allow the Project to monitor progress in closing the gender gap in health endowments between women and men, and the gaps between rural and urban women. In PNG, PHC services, or Frontline Health Services, refer to services delivered through facilities classified as levels 1, 2, 3 and 4 in accordance with the National Health Service Standards (or other equivalent classification acceptable to the World Bank and described in the Project Operation Manual (POM), including services provided through outreach from these facilities38. B. Project Components 42. IMPACT Health, a proposed US$30 million equivalent operation, will support GoPNG, and specifically the NDOH and Selected PHAs, with strengthening the delivery of Frontline Health Services in Selected Provinces. 43. IMPACT Health is comprised of four components which are briefly described in the following paragraphs (see annex 1 for a detailed description) as follows: Component 1: Increase service delivery readiness and community-based service delivery (US$12.4 million equivalent) 36 For the purposes of the Project, Eligible Level 2-4 Health Care Facilities include health care facilities managed by GoPNG and/or churches within the Selected Provinces, which are classified as Levels 2 to 4 in accordance with the National Health Service Standards, or other equivalent classification acceptable to the World Bank, and set forth in the DLI Operational Manual. 37 Selected Provinces include provinces in PNG, which may include National Capital District, that have met the selection criteria for participating in Component 1 of the Project as set forth in the Project Operational Manual and agreed with the Bank. 38 The National Health Service Standards in PNG classify facilities according to levels 1 to 4. These include, respectively, Aid Posts, Community Health Posts, Rural Health Centers (or Urban Clinics) and District Hospitals. Page 18 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) 44. Component 1 seeks to increase readiness to deliver Frontline Health Services, as well as to trial and scale up community-based innovations to generate demand for and improve access to facility and outreach-based health services. Component 1 will finance the purchase of equipment and supplies, training, technical assistance (TA) and limited infrastructure upgrades. 45. This component includes four sub-components. Sub-components 1.1, 1.2 and 1.3 will be focused on four Selected Provinces. It is expected that the two Early Adopter Provinces will be identified and selected prior to the effective date of the financing agreement (but in any case, not later than four months after such effective date). The two Expansion Provinces are to be selected prior to expansion. For a detailed description of the process to be followed for the selection of the four Selected Provinces, please refer to the respective section in paragraph 77. 46. Implementation of province-specific activities under Sub-components 1.1, 1.2 and 1.3 will begin in the Early Adopter Provinces and potentially expanded to up to two Expansion Provinces assuming adequate implementation progress. Expansion will be considered after a review of implementation progress and is proposed in Year 3. However, expansion may be considered sooner if Project implementation is deemed strong enough to merit it. Project disbursement levels will be one of the criteria used to ascertain implementation readiness for geographic expansion. 47. Sub-component 1.1: Strengthening readiness to deliver services at Frontline Health Facilities and through outreach (US$5.0 million equivalent). 48. This sub-component seeks to increase service delivery readiness at Frontline Health Facilities in Selected Provinces. It is proposed that this sub-component will finance inputs to strengthen service delivery readiness. This may include: (i) carrying out training to build health workers’ skills and improve the quality of essential health services (like family planning and ANC); (ii) improving communications and information technology; (iii) providing equipment to ensure the availability of services at frontlines facilities (e.g. fetal stethoscopes and delivery kits), supplies and ambulances to ensure availability of health services; (iv) upgrading health facilities to meet national standards (i.e., water and electricity, provision of health care waste management equipment/supplies) - no new facilities will be constructed; and (v) increasing capacity to screen for and deliver counseling and other support services to address gender-based violence, including by taking advantage of ANC and other points of contact that women have with the health system. Activities financed under this sub-component will prioritize those that will contribute to closing the gender gap in health endowments between women and men, and between rural women and urban women. These include training to improve the quality of essential health services like family planning and ANC, the procurement of basic equipment to ensure the availability of services at frontlines facilities (e.g. fetal stethoscopes and delivery kits), and the purchase of ambulances to refer complicated cases to higher-level facilities. The investments proposed will be complementary and oriented to filling the gaps that exist. Furthermore, any investments in health facility infrastructure and equipment will aim to close the gaps identified in Provincial Health Service Development Plans and will prioritize facilities based on ease of physical access and transport links, and the presence of a minimal complement of skilled staff. 49. Sub-component 1.2: Innovations in community-based service delivery (US$2 million equivalent). The objective of this sub-component is to trial and subsequently scale-up digital innovations to improve access to and use of Frontline Health Services. This sub-component will finance: (i) contracts with non-governmental organizations/non-state service providers to implement strategies to improve access to services at the community level, particularly digital innovations to supervise and support Community Health Workers and volunteers in remote rural communities, as well as to support citizen engagement and accountability for service delivery; and (ii) contract to evaluate of a proof-of-concept for implementation. Investments in community-based service delivery (particularly those in Community Health Workers and volunteers) are expected to contribute to increases in the uptake of health services. These efforts will particularly target pregnant women in order to reduce the number of preventable deaths among women driven by the low coverage and utilization of RMNCH-N services. Each of the two Early Adopter Provinces will implement one innovation. At the end of Page 19 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) three years of implementation, these innovations will be evaluated to inform decisions on scaling up implementation to at least one district in each of the four Selected Provinces for this component. 50. Sub-component 1.3: Strengthening readiness at Provincial Health Authorities (PHAs) (US$3.25 million equivalent). The objective of this sub-component is to build the capacity of PHAs in Selected Provinces on PFM, service planning, supportive supervision, performance management, monitoring and oversight and other relevant areas to ensure good quality health service delivery. These may include training, TA, purchase of equipment to support performance monitoring and oversight, including tablets to support data collection and skills building during supervision, communications and information technology equipment and vehicles, as well as operating costs for supportive supervision and maintenance for vehicles procured. Supervision tools will be designed to cover key areas that affect the quality of RMNCH-N services such as the availability of critical inputs and the level of competency of health workers to deliver such services. 51. The specific capacities targeted by this sub-component include: PFM, service planning and supervision. Support provided through this component will complement that provided under the PNG Program of Advisory Services and Analytics (PASA), assuming there is geographic overlap in support. Support provided will also complement the Asian Development Bank (ADB) financed training to PHA Board leadership and PHA managers by delivering continuous assistance and mentoring. 52. Sub-component 1.4: National oversight (US$2.15 million equivalent). The objective of this sub-component is to support national, primarily NDOH, oversight of: (a) PHA reforms and (b) service delivery results of Frontline Health Facilities in Selected Provinces. This sub-component will finance inputs including: (i) appointing an independent verification agent for Component 2; (ii) providing technical support to PHAs to improve the delivery of Frontline Health Services; (iii) finalizing a policy and regulatory framework for the PHAs reforms; and (iv) communicating and information sharing on the Project with PHAs and other key stakeholders. Inputs may also include purchase of equipment to support performance monitoring and oversight, including independent verification costs, operating costs, training and TA. Financing for independent verification is included in sub-component 1.4 as it is also a mechanism to strengthen routine data collection systems essential for NDOH’s oversight of the health sector. 53. Additional support for improved quality and monitoring of services will be available under the Primary Health Care Performance Initiative (PHCPI) to be financed outside the Project. PHCPI is a partnership between the World Bank Group, the WHO and Bill and Melinda Gates Foundation in collaboration with Results for Development and Ariadne Labs, to promote quality PHC for all, with a focus on low and middle-income countries. 54. Component 2: Improve frontline service delivery performance (US$14.6 million equivalent). Component 2 aims to support a program of activities designed to strengthen health systems at the national and provincial levels in order to improve the delivery of Frontline Health Services in Project-supported Provinces. Financing for this component will be provided based on results tracked by Disbursement Linked Indicators (DLIs). Financing under this component will be disbursed against evidence of achievement of DLI targets and documentation that the expenditures, identified in Eligible Expenditure Programs (EEP), to achieve DLI results have been incurred as further detailed in the DLI Operational Manual annexed to the Project Operational Manual (POM). The DLIs for IMPACT Health include a set of tracer indicators of health systems strengthening actions as well as their end results, i.e., services delivered and quality of care. The DLIs selected reflect the priorities identified in the NHP (2011-2020, as well as emerging priorities in the next Plan), National Health Service Standards and MTDP III. The results-linked financing provided through this component will seek to leverage investments to increase capacity to achieve improvements in frontline service delivery made under Component 1 as well as by GoPNG and by other DPs therefore improving value-for-money delivered from public spending on health more broadly. 55. The DLIs target strategic bottlenecks to strengthening frontline service delivery. These include: (i) Delayed flow of operational funding to PHAs by promoting the transfer of performance-linked funds to PHAs that achieve the relevant Page 20 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) targets early in the fiscal year; (ii) Weak sector governance due to fragmented and limited accountability for results; (iii) Inadequate supervision of service delivery. Supervision is not adequately used as a mechanism to support improvements in service delivery, including as a training and upward accountability tool; (iv) Declining outreach from health facilities. Outreach is an important means of expanding access to services in a country with difficult terrain and dispersed populations. In so doing, it is expected that the DLIs can promote improvements in service utilization and quality of care. 56. DLIs provide flexible financing to achieve results. DLI financing can be utilized in a flexible manner to address contextual bottlenecks for service delivery, whether these constitute infrastructure, equipment, operating costs, training or other. Guidelines on use and reporting on DLI funds will be included in the DLI operational manual, which will be a part of the POM. The DLI operational manual will recommend, but cannot mandate, that DLI financing will be used in accordance with MTDP III priorities. Please refer to paragraph 18 in Annex 1 for more details. Disbursement Linked Indicators. 57. Three types of health systems strengthening DLIs are proposed: (i) National DLIs (N-DLIs) which reward the achievement of results measured at the national level; (ii) Provincial DLIs (P-DLIs) which reward the achievement of results measured at the provincial level but are restricted to the four Selected Provinces that receive support under Sub- components 1.1, 1.2 and 1.3; and (iii) Competitive Provincial DLIs (C-DLIs) which reward the achievement of results measured at the provincial level and are open to all Provinces with an established PHA and which indicate interest in being considered for this component by signing a MoU with the NDOH. Funding under C-DLIs will be awarded to the two highest ranked improvers for each year. If more than two Eligible Provinces are ranked in the top two, the associated DLI funds will be split equally amongst these Provinces as further detailed in the DLI Operational Manual. Since these DLIs relate to improvements over the Province’s baseline, it is anticipated that it may be easier for PHA Provinces with poorer indicators to achieve them, hence improving equity. Following the disbursement of DLI funds to NDOH upon the achievement of P-DLI and/or C-DLI targets, NDOH will accordingly allocate and transfer funds out of its own budget (PHA Performance Funds) to the relevant Provinces for the achievement of P-DLIs and/or C-DLIs, in accordance with the details set out in the DLI Operational Manual. Unused DLI funds remaining or expected to be unused by the end of Year 5 will be reallocated to Component 1. 58. Table 3 below describes the DLIs and Project financing allocated to each over the duration of IMPACT Health. For more details on DLI design and implementation please refer to Annexes 1 and 2. Table 3: Disbursement Linked Indicators (DLIs) contribution to PDO DLI # DLI Province Contributes to DLI Financing Time-bound*/ eligibility the PDO by Value (US$ Scalable** improving equivalent) National DLIs DLI 1 National DLI 1: National Sector 600,000 Time-bound: Yes Memoranda of result- Not governance and (Year 1 Target is to Understanding applicable performance be achieved within (MoU) signed with oversight Year 1; Year 3 Target up to four (4) is to be achieved Selected PHAs within Year 2-Year 5); Scalable: Yes, by Page 21 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) DLI # DLI Province Contributes to DLI Financing Time-bound*/ eligibility the PDO by Value (US$ Scalable** improving equivalent) province. DLI 2 National DLI 2: National Quality 600,000 Time-bound: No; Integrated Facility result- Not Scalable: No. Supervision applicable Checklist adopted and updated DLI 3 National DLI 3: National Flow of funds to 1,500,000 Time-bound: No; Timely transfer of result- Not the frontlines Scalable: Yes, by PHA Performance applicable province. Funds DLI 4 National DLI 4: National Sector 1,000,000 Time-bound: Yes; Number of result- Not governance and Scalable: Yes, by Selected Provinces applicable oversight province. that have achieved all Provincial DLIs Provincial DLIs DLI 5 Provincial DLI 1: Provincial Sector 1,600,000 Time-bound: Yes; Number of result- 4 governance and Scalable: Yes, by Selected PHAs with Selected Public Financial province. a complete Annual Provinces are Management Implementation eligible Plan submitted in a timely manner and in accordance with NDOH specifications DLI 6 Provincial DLI 2: Provincial Quality and 2,100,000 Time-bound: Yes; Percentage of result- 4 performance Scalable: Yes, by Eligible Level 2-4 Selected oversight province. Health Care Provinces are Facilities in eligible Selected Provinces PDO Indicator that have achieved a Minimum Service Quality Score DLI 7 Provincial DLI 3: Provincial Performance 1,200,000 Time-bound: Yes; Number of PHA result- 4 oversight. Scalable: Yes, by Boards that have Selected This DLI will province. used routine data Provinces are incentivize the for decision Page 22 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) DLI # DLI Province Contributes to DLI Financing Time-bound*/ eligibility the PDO by Value (US$ Scalable** improving equivalent) making eligible use of the electronic National Health Information System (eNHIS) and other routine data to produce performance dashboards to support PHA Board decision making. DLI 8 Provincial DLI 4: Provincial Use 2,100,000 Time-bound: Yes; Percentage result- 4 Scalable: Yes, by increase in the Selected province and score. number of Provinces are PDO indicator Outreach Visits in eligible Selected Provinces Competitive DLIs DLI 9 Competitive DLI 1: Provincial Use 1,200,000 Time-bound: Yes; Percentage result- all PHA Scalable: No increase in the Provinces are number of eligible PDO indicator pregnant women who have received four (4) or more Awarded to ANC check-ups top 2 ranked improvers over baseline DLI 10 Competitive DLI 2: Provincial Use 1,200,000 Time-bound: Yes; Percentage result- all PHA Scalable: No increase in the Provinces are number of children eligible PDO indicator under one year of age who have received DPT-3 Awarded to top 2 ranked improvers over baseline Page 23 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) DLI # DLI Province Contributes to DLI Financing Time-bound*/ eligibility the PDO by Value (US$ Scalable** improving equivalent) DLI 11 Competitive Provincial Use 1,500,000 Time-bound: Yes; Provincial DLI 3: result- all PHA Scalable: No Increase in the Provinces are number of eligible PDO indicator registered Drug Susceptible TB (DSTB) patients on Awarded to treatment who top 2 ranked have been cured improvers over baseline *Time-bound: Target must be achieved within the indicated time period. Funding associated with DLI targets may not be disbursed if achievement is delayed. Non Time-Bound: Targets may be achieved at any time within Year 1 to Year 5. Year 1 will include the period from December 1, 2019 to June 30, 2021. **Scalable: DLI funding may be disbursed against partial achievement based on a specified formula in the Financing Agreement and the DLI Operational Manual. Component 3: Project management (US$3 million equivalent) 59. Financing under Component 3 will support technical and operational assistance to the Project Coordination Unit (PCU) on Project management and implementation. This may include TA for the PCU, equipment and furniture, operating costs to support supervision, including supervision-related costs incurred by the NDOH, as well as a vehicle, if needed. While the PCU will include existing staff from NDOH, full or part-time TA is expected to be required for a number of posts, such as Project Coordinator, Procurement Specialist, Financial Management Specialist, Monitoring & Evaluation Specialist, Communications specialist and Administrative Assistant. Where feasible, technical assistance will be shared with the PCU for the Emergency Tuberculosis Project. Component 4: Contingent emergency response (US$0 million) 60. The objective of this component is to improve GoPNG's response capacity in the event of an emergency, following the procedures governed by OP/BP 8.00 (Rapid Response to Crisis and Emergencies). The Component would support a rapid response to a request for urgent assistance in respect of an eligible event that has caused, or is likely to imminently cause, a major adverse economic and/or social impact to PNG associated with a natural or man-made crisis or disaster. In the event of an emergency, financial support could be mobilized by reallocation of funds from other Components to support expenditures on a positive list of goods and/or specific works and services required for emergency recovery. A Contingent Emergency Response Component Operational Manual (CERC OM), governing implementation arrangements for this component, will be prepared with support under the Project Preparation Grant (PPG). C. Project Beneficiaries 61. IMPACT Health’s primary target groups are the residents in the Selected Provinces who access health care at health facilities classified as levels 1 to 4 in accordance with the National Health Standards (or other equivalent classification acceptable to the World Bank); although covering the whole population of catchment areas, users of these services are primarily women and children. According to the 2011 census, population size in PNG ranges from 60,485 inhabitants in Manus to 674,810 in Morobe. Nationwide, women and children under five represent 48 percent and 12 percent of the total population respectively. To attain the targets, training will be provided to health facility staff as well Page 24 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) as staff working in selected administrative capacities at the Provincial level. Through twinning TA provided at the NDOH for Project implementation, the staff that the consultants are expected to work with will also benefit from the skills which would be imparted to them. In sum, the beneficiaries will be those seeking health care at lower level facilities in the Selected Provinces, those managing the delivery of health services in those Provinces, as well as the NDOH staff who form the PCU. D. Results Chain 62. Figure 4 below presents the results chain for the Project, showing the expected outputs and anticipated outcomes. In summary, the Project will combine health system strengthening activities such as the introduction of performance- based financing through DLIs and PFM strengthening activities, and interventions to directly improve facilities’ service delivery readiness. Figure 4: Theory of Change Page 25 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) E. Rationale for Bank Involvement and Role of Partners 63. The Project is aligned with GoPNG and CPF priorities. As discussed earlier, IMPACT Health is aligned with the current as well as new PNG CPF, and also aligned with PNG’s policy framework. IMPACT Health contributes to KRAs 3, 5 and 6 in the MTDP III and is aligned with the NHP focus on strengthening PHC for all (‘Going Back to Basics’) as well as strengthening the operationalization of the PHA model as a means to improve service delivery. The Project supports PNG’s Human Capital agenda and seeks to address key sectoral bottlenecks to the accumulation of human capital in the country. Subject to GoPNG decision on the Early Adopter Provinces selected, IMPACT Health may converge with World Bank-financed investments in Agriculture to accelerate the reduction of stunting in these two provinces. 64. PNG faces the prospect of declining assistance from critical partners such as Global Fund and GAVI. As mentioned previously, as PNG has achieved middle-income country status, it has entered GAVI’s accelerated transition phase and the Global Fund has begun to decrease their support. Global Fund grants to PNG have decreased by nearly 50 percent in the current funding cycle. GAVI was expected to complete its transition from PNG by 2021 but a recent GAVI Board decision has extended PNG’s ‘Acceleration Transition’ status until the end of 2025 allowing the country’s systems a limited amount of time to prepare for the future transition from GAVI support. The transition of important partners like GAVI and the Global Fund is expected to have a disproportionate adverse impact on the vital services supported by their funding unless PNG’s health systems are strengthened to manage the transition well. In this context, Australia’s Department of Foreign Affairs and Trade (DFAT), Global Fund and GAVI have signaled interest in co-financing IMPACT Health with a view to strengthen country systems to maintain and improve service delivery and health outcomes. 65. The Project is an integral part of a broader package of support from the World Bank to the health sector in PNG. The World Bank – through Australia’s DFAT-funded PASA - has been supporting analytical work and delivering TA to the NDOH for more than five years. This work has focused primarily on health financing and PFM and has produced an important body of evidence that highlights the need to improve efficiency in public health spending. The current phase of this program of work is aligned with the focus of this proposed operation: i.e., to strengthen service delivery at the frontlines by improving prioritization and planning and service delivery performance and accountability. The PASA will deepen its focus on working with PHAs in these two thematic areas. In doing so the PASA could provide valuable TA and analytical support to the proposed operation. The NDOH is therefore considering the possibility of focusing sub-national PFM TA under the PASA on the Early Adopter IMPACT Health Provinces. The Project will also seek to leverage expertise from global initiatives for PNG. The PHCPI will provide technical expertise and opportunities for knowledge exchange on PHC performance monitoring and oversight. 66. Interventions under this Project will be delivered in a coordinated manner with key DPs and seek to complement their support for greater development impact. DP support to the health sector in PNG is largely delivered outside of country systems and significantly contributes to the financing of the sector, as well as service delivery. The partner coordination mechanisms led by the NDOH will provide the main coordination platform during implementation. Performance incentives in the design of IMPACT Health are intended to increase the value from existing and planned partner investments in health infrastructure, TA and training by signaling a focus on results and improving the flow of financing to the frontlines so that operational funding is available to deliver services enabled by these investments. IMPACT Health will also seek to leverage ADB-financed investments in the eNHIS by incentivizing the use of these data in oversight and management of service delivery. Furthermore, independent verification of these data will help to increase the quality and credibility of eNHIS data. 67. A sub-national PHC service delivery program co-financed by Australia’s DFAT, GAVI and Government of New Zealand is planned to start implementing in September 2019. It is anticipated that this investment will mainly fund non-state actors to deliver PHC services in 12 provinces. IMPACT Health will complement this sub-national service delivery program through a focus on building PHA capacity to manage and oversee provincial service delivery. This Page 26 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) system-strengthening support is also intended to increase the likelihood that service delivery gains achieved through the sub-national service delivery program are sustained after donor support ends. F. Lessons Learned and Reflected in the Project Design 68. Increasing implementation readiness to reduce start-up delays. Experience with the PNG portfolio, as well as the Emergency Tuberculosis Project, suggests that delays in procuring key management and fiduciary staff to PCUs contribute heavily to slow implementation. To mitigate this, a PPG, with financing from Australia’s DFAT, will support the hiring of critical PCU staff and initiate other preparatory activities. 69. Lessons learned from the implementation of the Emergency TB Project. In addition to the importance of implementation readiness to reduce start-up delays, the implementation experience with the Emergency TB Project highlights the value of managing complexity in design and implementation. The following design features seek to manage the burden or complexity of implementation: (i) Phased geographic expansion both to manage implementation burden and incorporate lessons learned from early implementation experience; (ii) A relatively small number of DLIs have targets in any given year, to minimize the implementation burden on the NDOH and PHAs; and (iii) Competitive DLIs, which all PHA provinces will be eligible for, will only be introduced in Year 3. 70. DLI design has been informed by lessons learned from the implementation of the DLI modality in Health, Nutrition, and Population as well as in the fisheries sector in the Pacific . The following lessons from the implementation experience with DLIs are built into IMPACT Health: (i) Ensure flow of DLI funds early in the implementation cycle to facilitate results achievement. This is especially important in PNG as delayed operational fund flows to the frontlines are a constraint to results achievement. IMPACT Health seeks to ensure that funds flow early in the implementation cycle through DLIs that could, in principle, be achieved by effectiveness. In subsequent years the flow of DLI funds is tailored to the budget cycle to enable disbursement in January which is the start of the fiscal year; (ii) Recognize and minimize the administrative burden associated with DLI reporting and verification. DLIs in Investment Project Financing (IPF) operations impose an additional reporting and verification requirement. However, as the experience with DLIs in Lao People’s Democratic Republic (PDR) suggests, these requirements can have a substantial positive impact on health sector governance if they serve to increase the credibility of routinely reported data. IMPACT Health DLIs will be measured using data that are routinely reported through the eNHIS or that are collected through routine management processes such as supervision that have positive impacts on service delivery and accountability. The administrative cost of implementing DLIs will therefore be relatively low and independent verification is likely to have positive externalities for sector monitoring and evaluation by improving the credibility of routinely reported data. Bearing in mind the administrative costs associated with reporting on DLIs, annual reporting is planned although the NDOH will have the option of reporting semi-annually for some results; (iii) Build in flexibility. This is important in the PNG context given this is a new modality. Where feasible, IMPACT Health DLIs are scalable allowing for partial disbursement in proportion to target achievement. There are no year 6 DLI targets to enable this component to disburse completely by the closing date; (iv) Design DLIs that are fit-for-purpose and with adequate EEPs. Although DLI targets were largely achieved in the Pacific Regional Oceanscape Program (PROP- P151777), the only IPF with DLIs for IDA Pacific countries DLI disbursements could not be made as inadequate expenditures were incurred in the selected EEPs. Furthermore, an evaluation of the experience found that the DLIs had little influence on the related targets of the Program. IMPACT Health DLI results are in the span of control of the NDOH and PHAs and anchored in the national policy framework, with associated DLI financing commensurate to strategic value of the results. The ‘Salaries and Allowances’ line in the NDOH Budget that has been identified as the EEP has predictable and adequate expenditures; and (v) Ensure that DLI definitions and implementation arrangements are clear and realistic. An assessment of the PROP experience with DLIs flagged lack of clarity in DLI definitions as well as inadequate guidance to country teams as a Page 27 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) constraint to implementation. IMPACT Health takes this experience into account. A DLI Operational Manual that presents detailed operational guidance for the implementation of this Component will be included as an annex to the POM. In addition to consultations with key stakeholders, including central agencies, on the design of this Component as a part of the preparation process, IMPACT Health will include financing to support internal (to the health system) and external (with other key stakeholders) communications on DLIs and Project implementation as well as for experience sharing on implementation. III. IMPLEMENTATION ARRANGEMENTS A. Institutional and Implementation Arrangements 71. The NDOH will be the implementing agency for IMPACT Health, as it plays a critical role in the oversight of PNG’s health system. The NDOH is responsible for the design and implementation of national policies and programs, as well as the consolidation of the national budget for all health agencies including PHAs. PHAs are legally accountable to the Minister of Health and HIV/AIDS39, and the establishment and operationalization of PHAs is a national reform championed by the NDOH. 72. The NDOH is in the process of a reorganization. The description below is based on the existing configuration. The NDOH Secretary for Health will be the Project Director for IMPACT Health, with day-to-day running of the Project delegated to the NDOH Deputy Secretary, National Health Policy and Corporate Services (NHPCS). The Deputy Secretary will be assisted by the PCU, which will be mapped to a health sector coordination secretariat once it is set up. The PCU will be responsible for carrying out day-to-day management and implementation of the Project. It will comprise staff within NDOH, as well as a Project Coordinator who will be contracted over the Project period, and other consultants providing support to fiduciary aspects (procurement and financial management) and safeguards, coordination, monitoring and evaluation, and communication of Project activities. PCU requirements will be reviewed during implementation. Given the existence of an active World Bank-financed Project in the health sector, the Emergency TB Project, consultants will share their time between the Emergency TB Project and IMPACT Health PCUs in cases where full-time support may not be needed (e.g., in the case of the procurement specialist). 73. Individual consultants in the PCU will be required to support Project implementation and to build the capacity of existing NDOH staff in key Project implementation areas such as (a) Project management; (b) procurement; (c) financial management; (d) safeguards; and (e) information dissemination. By not later than six months after effective date of the Financing Agreement, the following positions within the PCU will be recruited or appointed: (a) a Project coordinator; (b) a procurement specialist; (c) a financial management specialist; (d) a monitoring and evaluation specialist; and (e) an administrative assistant, each with terms of reference, qualifications and experience satisfactory to the Bank. All contracted individuals will be assigned to support one or more existing NDOH staff who will be nominated by the NDOH Deputy Secretary on NHPCS. Regardless of any structural changes within the NDOH, the Project will require the support from the various technical areas, such as PHC, finance, management, policy, planning, performance monitoring and research, disease control and surveillance, public health, and health promotion. 74. The PCU will be responsible to support the NDOH for the following tasks: (a) preparation, approval and adoption of the POM and the CERC OM; (b) overall administration of the Project, including the preparation of annual work plans and budgets; (c) overall implementation of Project activities, with the support of the NDOH technical departments, and those PHAs participating in the Project; 39 The PHA Act (2007) and the PHA Amendment Act (2013). Page 28 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) (d) overall administration of financial management, procurement, environmental and social safeguards management, and communication on all Project activities; (e) overall monitoring, evaluation and reporting of Project activities and DLIs, including submission of findings by the Independent Verification Agent (IVA) on which funds will be disbursed against DLIs; (f) organization of quarterly reviews, ensuring that the World Bank implementation support reviews are timed to match at least two of these quarterly reviews per year; and (g) preparation of semi-annual progress reports covering all aspects of implementation such as Project activities and the achievement of DLIs, as well as the fiduciary aspects and disbursements. 75. With reference to DLIs, the NDOH will be responsible for implementing Component 2 with the support of participating PHAs. The POM, which will be adopted by not later than three months after the effective date of the Financing Agreement, will include a DLI Operational Manual annex which will set out detailed operational guidelines on implementation, including guidelines on the verification of DLI targets and utilization of and reporting on Component 2 funds. To support implementation of this Component, the NDOH will, prior to carrying out any activities under Component 2, enter into an MoU with each PHA in the four Selected Provinces for Provincial DLIs (P-DLIs). An MoU between the NDOH and PHA will also be required for a province to be eligible for the Competitive DLIs (C-DLIs). These MoUs will (a) set out the roles and responsibilities of the NDOH and PHAs in implementing Component 2, including further detail on the DLIs, such as the relevant baseline or method for calculating the baseline, require compliance with the POM, and specify details for the transfer of PHA Performance Funds to PHAs that meet P-DLI or C-DLI targets, as further detailed in the DLI Operational Manual. PHA Performance Funds are intended to improve the flow of GoPNG funding to the frontlines. 76. Technical support for the implementation of DLIs will be provided by different levels and entities within the PNG Health System. Technical departments within the NDOH, notably Strategic Policy and Planning Division, Public Health Division and Corporate Services Division, will support the achievement of DLI results, including through: (i) Support to establishing, operationalizing and building the capacity of PHAs and facilitating PHA functioning; (ii) Direct support to service delivery through vertical programs; and (iii) Oversight and management of the health system. PHAs, in turn, will manage delivery of Frontline Health Services. 77. Province selection. The selection process for the four Selected Provinces (two Early Adopter and two Expansion Provinces) to implement Sub-components 1.1, 1.2 and 1.3 and P-DLIs under Component 2 consists of 3 main steps as further detailed in the POM. The first step is the application of pre-qualification criteria to determine eligible Provinces. These criteria are: (a) The presence of a PHA established prior to March 2019; (b) Health outcomes, as measured by the Sector Performance Annual Report (SPAR) reporting; (c) Level of PFM capacity; (d) Regional representation; (e) DPs’ support to the health sector; and (f) Convergence with the IDA-financed PNG Agriculture Commercialization and Diversification Project. With reference to the selection criteria ‘b’ and ‘c’, the objective is to include mid-level performers. With reference to criterion ‘e’, Provinces that receive high levels of DP support will not be considered. During the second stage of the selection process, the NDOH will invite PHAs in the Provinces that meet all pre-qualification criteria to provide an Expression of Interest. In the third and final step, NDOH will review the Expressions of Interest and select Selected Provinces based on the quality of these submissions. This process will be conducted twice during the life of the Project: the first time will be for the selection of two Early Adopter Provinces. It is expected that the two Early Adopter Provinces will be identified and selected prior to project effectiveness (but in any case, not later than four months after the effective date). The second time will be for the selection of Expansion Provinces and this will be completed prior to Project expansion (planned for June 2022). Based on the experience with Early Adopter Provinces, the selection criteria for Expansion Provinces may be modified. Page 29 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) B. Results Monitoring and Evaluation Arrangements 78. Progress toward the PDO will be monitored through reporting on the PDO-level and intermediate-level results indicators. A Results Framework with Project-specific indicators and actionable monitoring arrangements has been developed jointly with the NDOH and other stakeholders. This will be used for monitoring of implementation progress and results of Project implementation. Overall monitoring and coordination of Project activities will be performed by the implementing agency with the support of the PCU. The PCU will have overall responsibility for monitoring and evaluation of the different components/activities in accordance with the indicators included in the Results Framework. The PCU will gather data from the relevant units in the Government and IVA. No later than 45 days after each semester (semi- annually), the PCU will submit semester progress reports to the World Bank, covering all Project activities, including procurement and financial summary reports. The Project will also submit its Annual Work Plan and Budget for the World Bank’s no-objection within two months after the effective date of the Financing Agreement and by June 1st of each subsequent year of implementation. 79. The World Bank will monitor implementation progress during implementation support visits which will provide a detailed analysis of implementation progress toward achieving the PDO and include an evaluation of financial management and a post-review of procurement activities. During the implementation support visits, the World Bank will work with the NDOH, Department of National Planning and Monitoring (DNPM), participating PHAs and other key stakeholders to obtain feedback on progress and consider any adjustments to ongoing activities. 80. By not later than three years after the effective date of the Financing Agreement (or such other date as agreed with the World Bank), NDOH and the World Bank will carry out a midterm review of the Project. NDOH will prepare and furnish to the World Bank, at least one month before the midterm review, a midterm report documenting progress achieved in the implementation of the Project during the period preceding the date of such report, including the monitoring and evaluation activities performed and setting out the measures recommended to ensure the continued efficient implementation of the Project and the achievement of its objectives during the period following such date. It will review this midterm report with the World Bank and thereafter take all measures required to ensure the continued efficient implementation of the Project and the achievement of its objectives. At the end of the Project, the World Bank will prepare an Implementation Completion and Results Report, which will include an assessment of the Project by the Government, to evaluate the Project and draw lessons. C. Sustainability 81. IMPACT Health was designed in response to a request by the Government to support frontline health service delivery, with a view to building the necessary elements and capacity for supporting the vision contained in the Government’s NHP 2011-2020; the focus on strengthening frontline service delivery is not expected to change in the next Plan. In addition, the Project has been designed to complement activities currently supported by other DPs with a view to building synergies. The NHP focus is on strengthening PHC, and support is available in the first instance to build capacity to improve care at this level, including financing to support and assess innovations in community-based service delivery with a view to scaling up evidence-based successful interventions. IMPACT Health will initially focus on two Provinces to be selected following the criteria and process outlined in the PAD, with NDOH providing support to the Province’s nascent efforts to build a healthy population starting at the ground level. With a view to ensuring sustainability of activities, the Project could support finalization of the policy and regulation framework for reforms to be undertaken in the Provinces with respect to health care delivery, as well as activities (i.e., policies and analytics) for essential health service delivery. Using DLIs provides an incentive to attain targets. As the Project supports GoPNG’s vision the focus on and funding for these activities are not expected to change beyond the Project life. Page 30 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) IV. PROJECT APPRAISAL SUMMARY A. Technical, Economic and Financial Analysis Economic Analysis 82. Global evidence indicates that health investments significantly contribute to economic growth and economic development. A study by Arrow et al. included the health sector as one of five key drivers of wealth creation between 1995 and 2000 and found that contributions from the health sector were higher than those of all other four sectors combined40. Moreover, the World Bank’s report “The Changing Wealth of Nations” indicated that investments in human capital are associated with an acceleration of GDP growth of up to 1.25 percent. Improvements in health outcomes promote economic growth through several channels, including higher education outcomes, productivity increases, higher saving rates, and lower fertility rates (demographic dividend41)42. Failures to invest in health result in high health sector costs and have strong impacts on social inequalities: health care costs in countries with limited financial protection and low public financing push 150 million people below the poverty line43. 83. Improvements in health outcomes in PNG will have high economic returns. Given PNG’s young population (40 percent under 15; 14 percent are under 5), investments in health will allow the country to reap the benefits of the demographic dividend and reduce the economic costs of poor health and nutrition. Undernutrition alone had an estimated associated cost of 2.8 percent of GDP in 2015-1644. The high prevalence of communicable diseases such as TB, in turn, negatively impacts PNG’s labor force productivity (the greatest number of infectious cases of MDR TB occur in the most economically active group) and hinders the development of economic activities like tourism. Cost benefit analyses45 suggest that a US$1 investment would generate a US$14 benefit from averted TB-related deaths, averted illness resulting in increased productivity, and saved medical costs. Furthermore, a weak health system has led to numerous disease outbreaks that have expensive containment costs46 and lead to inefficient spending. Since June 2018, the GoPNG has allocated over US$2.2 million to address the Polio outbreak, and most of this funding will be spent on supplementary immunization activities, which will not deliver lasting improvements in immunization coverage. 84. Additional economic gains can be expected from better value-for-money in public health spending. Increases in spending on health have not translated into commensurate improvements in health outcomes. Downward revisions to government revenues could lead to potential cuts in public health spending. Reduced fiscal space for health and high population growth emphasize the need to improve the quality of health spending to translate investments into outcomes and curtail unproductive spending. 85. With a total envelope of US$30 million, the present value of the Project using a 5 percent discount rate is US$26.4 million. 40 Arrow, K.J. et al. 2010. Sustainability and the measurement of wealth. National Bureau of Economic Research. Available at: www.nber.org/papers/w16599 41 The demographic dividend refers to the temporary decrease of the dependency ratio derived from lower mortality and fertility rates. 42 Yamey, Beyeler, Wadge and Jamison 2016. “Investing in Health: The Economic Case. Doha, Qatar: World Innovation Summit fo r Health”. 43 Ibid. 44 Save the Children, 2017. “Short changed: The human and economic cost of child undernutrition in Papua New Guinea”. 45 World Bank estimates. See the Project Appraisal Document for the Emergency Tuberculosis Project for more details: < http://documents.worldbank.org/curated/en/505941496664893549/pdf/Papua-New-Guinea-Emergency-Tubercolosis-Project-PAD- 05192017.pdf> 46 For example, the ebola outbreak in Liberia, Sierra Leone and Guinea has had profound adverse health and economic impact (estimated $2.8 billion 2014-2016) with effects persisting well beyond the outbreak itself. Page 31 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Table 4: Present Value of Project Fiscal Year Actual cost Actual cost (cumulative) Present value Present value (cumulative) 2020 4.9 4.9 4.9 4.9 2021 4 8.9 3.8 8.7 2022 6.4 15.3 5.8 14.5 2023 6.1 21.4 5.2 19.7 2024 6.1 27.5 4.9 24.6 2025 2.5 30 1.9 26.4 Total 30 26.4 86. A detailed cost-effectiveness analysis is hindered by the lack of baseline data on key health indicators. Standard tools to estimate the benefit of these investments, such as the Lives Saved Tool (LiST), require baseline estimates to calculate the impact of improvements in coverage on averted deaths. Furthermore, given the significant discrepancies in the performance of the health sector between provinces, cost-effectiveness ratios will depend on the Selected Provinces. Similarly, given the lack of recent survey data, there are no estimates of differences in coverage of essential health services by income quintile. As a consequence of this, it is not possible to accurately estimate the impact of this Project on equity. Financial analysis 87. The devastating earthquake that struck PNG in February 2018 had a strong negative impact in the country’s economy and led to a decline in economic growth rates. Preliminary estimates by the World Bank suggest that GDP growth slowed from 2.8 percent in 2017 to 0.3 percent in 2018. Following the trajectory of volatile growth that characterized PNG’s economy, GDP growth rates in 2019 are expected to accelerate and reach 5.2, after which the economy is expected to grow at rates slightly higher than 3 percent. 88. In this context of positive economic growth, forecasts suggest a reduction in the overall fiscal deficit. PNG has introduced fiscal policies that aim to stabilize the economy, promote fiscal sustainability and protect the country from the financial distress caused by external shocks like natural disasters or the decline in international commodity prices. These policies include the adoption of fiscal anchors, as well as a greater focus on fiscal consolidation. PNG exceeded the targets for revenue collection in 2018. This was driven by mining and petroleum taxes and dividends, as well as substantial contributions from DPs following the earthquake. Expenditure levels in that year were also higher than planned, primarily as a result of increases in personal emoluments. Overall, however, thanks to the above-mentioned fiscal consolidation efforts, the fiscal balance is expected to decline by 2021. The fiscal deficit for 2021 is projected to be 1.5 percent. 89. Despite these efforts, PNG’s net public debt is forecasted to remain stable. Improvements in the country’s fiscal position will not suffice to reverse the negative overall fiscal balance and this will contribute to nominal debt accumulation. Overall, net public debt as a share of GDP is projected to increase marginally from 34.2 percent of GDP in 2018 to 34.3 percent of GDP in 2021. Page 32 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Table 5: Selected economic indicators in percent of GDP 90. 91. 2014 92. 2015 93. 94. 2016 95. 2017 201896. 97. 2019 98. 2020 2021 99. 100. 101. 102. 103. Est.104. Est.105. Projections 106. Revenue and grants 107. 20.8 108. 18.3 109. 110. 16.1 16.2 111. 18.4 112. 113. 17.6 114. 17.1 16.7 115. Expenditure and net lending 116. 25.4 117. 22.4 118. 119. 20.9 18.7 120. 21.0 121. 122. 20.3 123. 19.0 18.2 124. Overall fiscal balance 125. -4.6 126. -4.1 127. 128. -4.7 -2.5 129. -2.7 130. 131. -2.7 132. -1.8 -1.5 133. Net public debt 134. 26.9 135. 30.1 136. 137. 33.2 33.3 138. 34.2 139. 140. 36.1 141. 35.4 34.3 Source: World Bank Economic Update 2019 90. An expected decline in expenditure, together with a strategy that prioritizes investments in productive physical infrastructure to human capital, could affect the availability of resources for the health sector . From 2018 to 2019, health spending as a share of GDP declined from 2.1 percent to 1.9 percent. The continuous decline in public health spending since 2015 has led to a decline in real per capita health expenditure and continued to expand the health financing gap. Inadequate investments in the health sector, as evidenced by PNG’s health sector performance, can disrupt health service delivery and have strong negative implications for health outcomes. This, in turn, could have negative economic impacts as high levels of human capital and a healthy population are key drivers of economic growth. Figure 5: Spending on selected sectors in 2018 and 2019 Source: World Bank 2019 91. IMPACT Health does not affect PNG’s debt position. With a total envelope of US$30 million, the Project’s impact on net debt accumulation is negligible. Disregarding the positive economic effects from improvements in population health and their contribution to economic growth, the Project would lead to increases in public debt of less than half a percentage point. 92. The Project does not pose considerable risks for the sustainability of public health spending. In 2019, GoPNG allocated PGK1.5 billion to the health sector. This figure excludes contributions from Provincial Internal Revenue and SIPs to the health sector. Assuming that allocations do not decrease over time, annual investments under IMPACT Health represent roughly one percent of the sector’s spending. Moreover, the Project will contribute to improving value -for- Page 33 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) money in public health spending by introducing a result-focused approach, by strengthening PFM skills and by promoting improvements in the quality of health services. High quality health care can ensure that all the resources that are utilized in the production of health are used to their full potential and maximize health outcomes. 93. Further, investments under IMPACT Health are financially sustainable given the low pressure that they exert on future operational spending. Firstly, IMPACT Health will finance minor investments in infrastructure. As a result, the Project will not create significant pressure on future operational spending such as maintenance costs. Secondly, the Project will not increase staffing numbers in the health sector. Like infrastructure investments, new positions put pressure on future operational spending, particularly on personal emoluments. Rationale for Government intervention 94. The GoPNG is committed to improving health outcomes and there is a strong rationale for their engagement in the sector. In terms of financing, public financing is key to contain out-of-pocket payments and therefore provide financial protection, particularly to the most vulnerable sectors of the population. Public funding also increases pooling opportunities that promote efficiency and equitable health spending. Furthermore, health system reforms like the decentralization of health services through the PHA model require public sector funding to ensure government’s ownership over the reform process. In terms of service delivery, the central level is responsible for the oversight and steering of the sector, and the provinces and districts play a crucial role in the management of service providers. While a significant share of health services is delivered through faith-based organizations, the GoPNG finances a large share of their operations (including salaries). 95. Sustainable improvements in health outcomes can only be achieved by strengthening PNG’s public health system. The on-going DP transition from the health sector has shed light on the financial and institutional challenges of financing and delivering health services outside country systems. To ensure that improvements in health outcomes are sustainable, investments will have to contribute to the strengthening of PNG’s health system and to improve its resilience. World Bank Value Added 96. The World Bank has extensive experience supporting health system strengthening programs in the EAP region (Lao PDR, Cambodia, Myanmar and Indonesia) and in the world (Nigeria, Afghanistan, Ethiopia, Tanzania) . This will grant PNG access to global expertise to design evidence-based interventions that can improve health outcomes in a sustainable and efficient manner. The World Bank’s experience in the implementation of performance-enhancing interventions will add value by introducing innovative approaches to financing and to the management of the health sector. These interventions will be delivered in a coordinated manner with key DPs, including Australia’s DFAT, ADB, GAVI and the Global Fund. 97. The proposed design has added benefits for results monitoring and reporting using government systems and could encourage the use of government systems by other DPs. Given that IMPACT Health operates within government systems (including financing to the subnational level), these investments improve value-for-money by strengthening government systems such as PFM, information systems and procurement at different government levels. This may help to build confidence in government systems and, combined with the focus on results introduced by the DLIs, it encourages the use of government systems by other DPs. Enhanced PFM skills, in turn, contribute to a more efficient use of resources. 98. Finally, an Emergency Tuberculosis Project became effective in September 2017 to support the Government of PNG’s response to TB, MDR TB and XDR-TB. The proposed Project is expected to have a positive impact on TB control in PNG given that weak health systems are one of the main drivers of TB in PNG. B. Fiduciary (i) Financial Management 99. A financial management assessment was carried out in accordance with the “Principles Based Financial Page 34 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Management Practice Manual” issued by the Vice President, Operations Policy and Country Services (OPCS) on February 04, 2015 and further elaborated in the Bank Guidance “Financial Management in World Bank -Financed Investment Operations” issued by OPCS on February 24, 2015. Under Bank Policy Investment Project Financing with respect to projects financed by the World Bank, the borrower and the Project implementing agencies are required to maintain financial management arrangements — including planning and budgeting, accounting, internal controls, funds flow, financial reporting, and auditing arrangements — acceptable to the Bank to provide reasonable assurance that the proceeds are used for the purposes for which they are granted. These arrangements are deemed acceptable if they are capable of correctly and completely recording all transactions and balances relating to the project. In addition, such arrangements are acceptable if they can facilitate the preparation of regular, timely and reliable information regarding project resources and expenditures and safeguard the Projects assets; and are subject to auditing arrangements acceptable to the World Bank. 100. The existing financial management arrangements of the NDOH appear acceptable to meet the financial management requirements as stipulated in the Bank’s Policy on Investment Project Financing. The Project’s overall financial management risk is rated as “High” (see Annex 2 for details on financial management). (ii) Procurement 101. Procurement for the Project will be carried out in accordance with the World Bank Procurement Regulations for IPF Borrowers (Procurement Regulations), July 2016 revised November 2017 and August 2018, as well as the provisions stipulated in the Financing Agreement. The Project will finance the procurement of consultant services (firms and individuals), goods, minor rehabilitation/small works contracts, non-consultant services. 102. Procurement Plan. A Procurement Plan for the first 18 months of Project implementation has been prepared based on information provided in the Project Procurement Strategy for Development. 103. Systematic Tracking of Exchanges in Procurement. The use of the World Bank Systematic Tracking of Exchanges in Procurement (STEP) system will be mandatory under the IMPACT Health Project. C. Safeguards (i) Environmental and Social Safeguards 104. The Project is unlikely to cause any significant adverse environmental or social impacts and has been categorized as Category B under OP 4.01 Environmental Assessment. The Project is expected to result in a positive social impact through facilitating improved access to health care for currently under-served populations in the Selected Provinces. PNG has complex land ownership structures; however civil works will only be undertaken at existing health facilities where landowner access agreements are in place. Hence, OP 4.12 Involuntary Resettlement has not been triggered. While OP 4.10 Indigenous Peoples has been triggered, the vast majority of PNG’s population is considered indigenous, therefore no separate instrument is required. Relevant elements of the OP 4.10 Indigenous Peoples have been integrated into Project design and the safeguard instruments, including citizen and stakeholder engagement in accordance with established local procedures. As the sub-project sites will not be known until implementation, an Environmental and Social Management Framework (ESMF), a Stakeholder Engagement Framework (SEF) and a Social Assessment Framework (SAF) (both the SEF and SAF are annexed to the ESMF), have been prepared by the NDOH and were publicly disclosed on October 3, 2019. Environmental Safeguards 105. The environmental risk associated with the Project’s interventions is low and will be mainly associated with the upgrades to health facilities to meet national standards and with health-care waste management (HCWM). Facility upgrades will involve refurbishment of existing premises to provide reliable electricity, water, sanitation and Page 35 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) communications facilities; and maintenance or repairs required to allow safe use by health center workers and patients. These upgrades will generate some construction waste, and this will be disposed of by the works contractor in accordance with provincial government requirements. There is also the potential for asbestos containing material to be encountered at the health facilities and its presence will need to be established at the outset to ensure adequate mitigation of worker and public health risks. 106. Health-care waste (HCW) includes hazardous and non-hazardous components, with the latter comprising waste from administrative, kitchen and housekeeping functions which is expected to be the larger proportion of the waste stream (approximately 85 percent). This waste can be disposed of as general municipal waste. Hazardous HCW on the other hand requires a strict management regime to ensure risks to public health and the environment are adequately managed. This waste stream may comprise sharps, infectious, pathological, pharmaceutical, chemical and radioactive wastes. The PHC facilities targeted under the Project are considered to be a minor waste source (WHO, 201447) given the small quantities produced. These sources typically have some common features: they rarely produce radioactive or cytostatic waste or human body parts; and sharps consist mainly of hypodermic needles. Notwithstanding the small quantities hazardous waste this will need to be managed in accordance with PNG National Health Service Standards and good international industry practice such as WHO (2014), which defines “minimum approaches” to managing health-care waste. Safe management of waste from health-care activities. 107. While the facilities to be managed under the Project will be at the PHC level and volumes of waste are expected to be small it will be important to ensure that hazardous waste is segregated at source and handled and disposed of in a safe manner. Waste management at PHC facilities is unlikely to involve treatment (e.g., incineration); hence land disposal via safe burial is expected to be the preferred option. Where required as a result of the screening processes set out in the ESMF, PHAs in Selected Provinces will need to prepare a Health-care Waste Management Plan (HCWMP), as part of the Environmental and Social Management Plan, that facilities in that Province will be required to follow to ensure that the preferred disposal method does not pose a risk to human or environmental health. Training in HCWM will be required for PHC staff including awareness raising about the potential hazards from HCW, safe waste-handling procedures, reporting of exposures and injuries, preventing infection following an exposure with post-exposure prophylaxis, and the use of personal protective equipment (PPE). Social safeguards 108. OP. 4.10 (Indigenous Peoples) is triggered, however, as the majority of beneficiaries are indigenous peoples, therefore no separate Indigenous Peoples Plan (IPP) will be prepared, however relevant elements of an IPP incorporated in the Project design and ESMF. 109. The ESMF includes procedures to screen environmental and social risks and a Grievance Redress Mechanism (GRM). In addition, the ESMF also includes a Stakeholder Engagement Framework (SEF) to document the required consultations with relevant stakeholders to ensure Project information is effectively conveyed to all people in the Project locations (in Selected Provinces), to ensure equal access to Project activities. 110. Climate and Disaster Risk Screening has helped identify that the risk of exposure to climate change or geophysical hazards for this Project is moderate. There is moderately high chance that Project activities may get affected by possible droughts, storm surges as a result of sea level rise, or landslides. These risks will be mitigated by the improvement of health services delivery in the Selected Provinces, which will help improve preparedness to the disaster. 111. The natural environment throughout PNG is extremely fragile and highly vulnerable to both natural and human impacts. During the last 50 years or so, increasing pressures on the resources are intensifying the country’s exposure to 47 World Health Organization (WHO) (2014) Safe management of wastes from health-care activities / edited by Y. Chartier et al. – 2nd ed. Page 36 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) extreme events such as natural hazards like cyclones, droughts, earthquakes and tsunamis. In addition to these threats and pressures in PNG, there are the expected changes that may arise from climate change and climate variability, which will likely further exacerbate these impacts and deplete the resources that are most essential for basic life support systems. 112. PNG has been buffeted by extreme weather and climate events such as those brought about by the El Nino in 1997/98 with further changes in temperatures and sea level rise predicted over the next 100 years. These events will lead to inundation of low lying inland and coastal areas, including the atoll islands, bleaching and loss of coastal defenses. Loss of wetlands, changes to the fisheries, forestry and agriculture sectors, alteration to water resources and land use practices and impacts on health, particularly vector borne diseases, such as malaria and other related water and air borne diseases, are also expected. Human health is strongly affected by PNG’s vulnerability to climate change. 113. The GoPNG is adopting a number of adaptation actions, including control of vector borne diseases, preventative health care through public awareness programs, and improvement of medical services. As mentioned before, the Government is in the process of decentralizing the country’s health system from the national to the provincial and district levels, which will enable more cost effective and coordinated delivery of services48. The proposed Project will significantly contribute to the Government’s commitment to reduce the consequences of climate change in PNG. 114. The Project supports a number of important adaptation measures to promote climate change awareness and monitor changes in infectious disease patterns. Specifically: 115. Under Sub-component 1.1 the Project will rehabilitate existing health care facilities in Selected Provinces. The design of the works will include considerations for the resilience of the buildings, which in addition to climate change mitigation (see below), will benefit the adaptation to climate change. The possible interventions and impacts of those will include: i) Use of local materials which will reduce length of time that facility is disrupted if damaged from weather event; ii) Stronger exterior walls and roofs which will enable building to withstand damage from extreme events; iii) Low- energy light fixtures which will allow building to operate longer on a fixed supply of fuel; iv) Solar water heating which will improve likelihood of maintaining hot water if utility services are disrupted. The cost of rehabilitation of facilities was estimated at US$2.0 million, with another US$2.0 million to be spent on facility equipment, including solar panels. 116. In addition, the Project will provide training to health workers, which will include seminars/sessions on recognizing early signs of heat strokes, malnutrition as a result of droughts, various disease patters, etc. (estimated cost US$300,000). As a result, it is expected that workers’ improved skills will build up the resilience of the communities to climate change. Further, the Project will finance communication campaigns that will include outreach to the communities on the importance of climate change. 117. Under Sub-component 1.2 the program will be trialing and scaling-up digital innovations to improve access to and use of Frontline Health Services. These innovations will be particularly targeted at maternal and child health at the community level seeking to increase uptake of services in this population. Worldwide, mortality due to natural disasters, including droughts, floods, and storms, is higher among women than men49. Living in rural areas may confer increased risk due to limited access to services and increased poverty50, in particular during pregnancy, which increases vulnerability to a wide range of climate related environmental hazards, including extreme heat51 and infectious diseases such as 48 UNDP https://www.adaptation-undp.org/explore/melanesia/papua-new-guinea?page=1 49 WHO, 2011. Gender, Climate Change and Health. Public Health & Environment Department (PHE), Health Security & Environment Cluster (HSE), World Health Organization (WHO), Geneva, Switzerland, 36 pp 50 Smith, K.R., 2008. Comparative environmental health assessments. Annals of the New York Academy of Sciences, 1140, 31-39. 51 Strand et al., 2012. Maternal exposure to ambient temperature and the risks of preterm birth and stillbirth in Brisbane, Australia. American Journal of Epidemiology, 175(2), 99-107 Page 37 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) malaria, foodborne infections, and influenza52. This component will increase the coverage and utilization of RMNCH services for these vulnerable women, thereby improving population resilience to climate change by providing increased access to health care, assisting them with increased burdens from the communicable diseases, and acting as a source of health advice to assist them in dealing with extreme heat and climate related nutritional challenges. 118. Under sub-component 1.3 the project will build the capacity of Selected PHAs to ensure good quality service delivery. This sub-component will finance inputs including digital health equipment such as tablets to strengthen these services enhancing overall health system adaption and resilience to the changing health burdens associated with climate change. Supervision tools will be designed to cover key areas that affect the quality of RMNCH services, these will include attention to the health impacts of climate change on the populations served including: nutritional deficiencies, response to climate-related extreme events, such as heat waves or flooding, and emerging or remerging climate-related communicable diseases such as dengue, malaria and water borne diseases. 119. Under sub-component 1.3 the project will build the capacity of Selected PHAs to ensure good quality service delivery. This sub-component will finance inputs including digital health equipment such as tablets to strengthen these services enhancing adaption and resilience to the changing health burdens associated with climate change. Supervision tools will be designed to cover key areas that affect the quality of RMNCH services, these will include attention to the health impacts of climate change on the populations served. 120. Finally, under Component 4, the Project also includes a CERC, which, if activated, would help to speed up the government's response during the emergency. 121. IMPACT Health will also support climate change mitigation measures to reduce net Greenhouse Gas (GHG) emissions by financing infrastructure upgrades to the existing health facilities in Selected Provinces (Sub-component 1.1, US$5.0 million). The possible interventions to reduce environmental impact and to contribute to low-carbon healthcare development will include climate-smart infrastructure solutions , such as: i) Use of local materials, which will reduce the energy to transport materials and will support local economy; ii) Use of low energy light fixtures, which will reduce energy consumption; iii) Solar water heating, which will reduce GHG from heating water and will lead to energy saving; iv) Reflective roofing which will reduce solar heat load and heat impacts; and v) Solar panels for facilities’ energy needs. 122. Once healthcare facilities are rehabilitated, improved access to services will have a co-beneficial significant impact in terms of reducing air pollution and its associated health impacts as a result of reduced transportation needs and hospitals use. 123. According to the Project design and flow of funds arrangement, the financing under Component 2 (DLIs) will be provided directly to the NDOH. This will improve overall flow of funds to the frontlines and in turn will strengthen the delivery of services closer to the communities. Since the achievement of results under Component 2 will seek to leverage investments to increase capacity to achieve improvements in frontline service delivery made under Component 1, DLIs will further strengthen the adaptation and mitigation measures listed above. (ii) Occupational and Community Health and Safety 124. Occupational and community health and safety hazards may be associated with construction and operational phases of PHC facilities. Construction phase hazards include potential for physical injury to workers and exposure to asbestos fibers if asbestos containing material is encountered. During operation occupational hazards will include hazardous waste handling and disposal, with community health hazards associated with poor health-care waste management. The sound design and implementation of a HWMP will mitigate these risks. 52 Van Kerkhove et al., 2011. Risk factors for severe outcomes following 2009 influenza A (H1N1) infection: a global pooled analysis. PLoS Medicine, 8(7), doi:10.1371/journal.pmed.1001053 1-12. Page 38 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) (iii) Citizen Engagement and Gender 125. Citizen Engagement. The Project will contribute to greater citizen engagement mainly by using supervision as a tool to verify that citizen feedback is being collected at points of service delivery and acted upon. An Integrated Facility Supervision Checklist will monitor whether citizen feedback and response mechanisms are functioning. Incentives to improve quality provided through P-DLI 2, i.e., quality scores on the Integrated Facility Supervision Checklist, will strengthen citizen feedback and response mechanisms by creating clear incentives to focus on improving quality, including citizen engagement and responsiveness to citizen concerns raised. The implementation of citizen feedback mechanisms, including evidence of responsiveness to citizen feedback, are measured through quality scores in the results framework (PDO 1). The Results Framework also tracks the percentage of health facilities have implemented patient feedback mechanisms and responded to issues identified. The community-based service delivery innovations that are trialed may also strengthen citizen engagement in health service delivery. Results Framework indicators, including the beneficiary feedback indicator, will be tracked during implementation through Implementation Status and Results Reports. 126. Gender. The Project will contribute to closing gaps in women’s endowments in health outlined in the World Bank Group Gender Strategy and the EAP Regional Gender Action Plan (RGAP), with a focus on maternal mortality and rural women’s access to health services. In PNG, gender inequality is a significant development challenge; as a result, women have substantially poorer access to health care services53. Coverage of antenatal care, an important opportunity to identify high-risk pregnancies, is slightly above 50 percent, and in some provinces like Jiwaka, Southern Highlands and Central province, coverage is below 40 percent. Poor access to pregnancy- and birth-related health services is exacerbated for rural women. According to the preliminary results of the DHS 2016-2018, only 47.2 percent of rural women who had a live birth in the 5 years preceding the survey received at least four ANC check-ups, while the coverage among women in urban areas was much higher (62.9 percent). Similar trends are observed for institutional delivery (51.1 percent among rural women and 85.4 among women in urban areas) and postnatal check-ups during the first 2 days after birth (42.1 percent for women in rural areas and 72.2 percent among women in urban areas). The ability of health centers and hospitals to provide both outpatient and inpatient services has shown a steady decline, while a workforce with insufficient staff, including a lack of trained midwives and Community Health Workers, further constrains provision of adequate care. A recent study has shown that skills to deliver maternal and child services, including ANC, are significantly low54. In rural areas, health services are provided mostly by male Community Health Workers (out of 3,006 Community Health Workers, 1,620 are male55) and this can also hinder the delivery of quality health services that are specific to women’s health. Poor health services place women’s lives at risk in childbirth and reduce the chances of their children surviving infancy and early childhood56. 127. Women are the only users of maternal and child health care facilities, but not all women are able to use them equally. Notwithstanding the generally poor access and availability, rural women have much greater access and outcome gaps than urban women. Very often, in case of the closure of local aid posts, rural women (usually with their children) have to travel further, incurring greater costs for transport, risks to their security, and opportunity costs of time away 53 Country Partnership Strategy for the Independent State of Papua New Guinea for the period FY2013-2016 (2012) 54 Hou, Xiaohui; Khan, M. Mahmud; Pulford, Justin; Saweri, Olga; Demir, Ibrahim; Haider, Rifat; Ahmed, Shakil. 2018. Service delivery by health facilities in Papua New Guinea: report based on a countrywide health facility survey (English). Washington, D.C.: World Bank Group. http://documents.worldbank.org/curated/en/269931525699558992/Service-delivery-by-health-facilities-in-Papua-New-Guinea- report-based-on-a-countrywide-health-facility-survey. 55Morris, Ian P.; Somanathan, Aparnaa. 2012. Papua New Guinea (PNG) health workforce crisis: a call to action (English). Washington D.C.: The World Bank. http://documents.worldbank.org/curated/en/216511468332461651/Papua-New-Guinea-PNG-health-workforce-crisis- a-call-to-action . 56 World Bank. 2012. Papua New Guinea - Country gender assessment for the period 2011-2012 (English). Washington DC: World Bank. http://documents.worldbank.org/curated/en/491231468058779689/Papua-New-Guinea-Country-gender-assessment-for-the-period- 2011-2012 Page 39 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) from home where women bear the heavy daily burden of childcare, food production and other household chores. Access to services for rural women is further restricted by the low number of outreach clinics (from rural health centers) to remote villages for immunization, ANC, nutrition monitoring and family planning. The low availability, quality, and utilization of essential health services is a key driver of poor health outcomes for women. The Project will finance activities to overcome supply- and demand-side barriers to rural women accessing RMNCH-N interventions that have demonstrated effectiveness in improving these outcomes. 128. In line with the recommendations of the Maternal and Child Health Task Force, IMPACT Health will support investments in the improvement of frontline facilities’ infrastructure and amenities, basic equipment, closing gaps in health workers’ RMNCH-N skills, and service delivery. The Project will also support community outreach activities, aimed, among other, at reducing cultural barriers to use/generate demand for health services. In particular, the Project will support bridging the access gap for rural women for ANC and promoting RMNCH-N services, given that women are often reluctant to seek care from male health workers. These activities include: purchasing equipment needed to deliver ANC, training staff in maternal and child skills to improve the quality of the ANC services delivered, improving health service delivery planning to promote higher coverage of ANC through outreach, and health promotion at the community level to increase the demand for ANC services. In addition, this is expected to improve access to services such as TB treatment where gender disparities exist. 129. The Project will measure its ability to close the gaps in these outcomes by monitoring the increase, in the Project- supported provinces, of the number of ANC visits; the number of PHC facilities that meet quality standards for ANC, institutional deliveries and family planning; the number of trained health workers on RMNCH-N skills; the number of immunized children disaggregated by gender; and the number of TB patients on treatment who have been cured disaggregated by gender. 130. Component 1 activities will also build in counseling and other support to address gender-based violence during ANC and other points of contact with the health system. Health planning needs, particularly for services delivered through outreach, will be based on gender-disaggregated data. Finally, the Project’s support for the use of routine reporting data, specifically eNHIS data, will improve gender disaggregated monitoring of indicators at a sectoral level. Performance indicators will be disaggregated, where relevant, in order to track inequities. (iv) Grievance Redress Mechanisms 131. Communities and individuals who believe that they are adversely affected by a World Bank supported Project may submit complaints to existing Project-level grievance redress mechanisms or the World Bank’s GRS. The GRS ensures that complaints received are promptly reviewed in order to address Project-related concerns. Project affected communities and individuals may submit their complaint to the World Bank’s independent Inspection Panel which determines whether harm occurred, or could occur, as a result of World Bank non-compliance with its policies and procedures. Complaints may be submitted at any time after concerns have been brought directly to the World Bank's attention, and World Bank Management has been given an opportunity to respond. For information on how to submit complaints to the World Bank’s corporate GRS, please visit http://www.worldbank.org/en/projects- operations/products-and-services/grievance-redress-service. For information on how to submit complaints to the World Bank Inspection Panel, please visit www.inspectionpanel.org V. KEY RISKS 132. The overall Project risk is High. The key risks are: (i) Limited technical capacity; (ii) Relative lack of experience in implementing World Bank-financed projects, including the areas of procurement and financial management; (iii) The introduction of results-based financing using DLIs, an innovative approach that has not been implemented before in PNG; and (iv) The need to coordinate among a number of stakeholders across national and provincial levels to improve health service delivery at the frontlines. The World Bank’s lending engagement in the PNG health sector is also relatively Page 40 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) new. 133. Macroeconomic risk - Substantial. PNG’s economy continues to face economic headwinds resulting from global and domestic economic uncertainties. PNG’s growth outlook is being affected negatively by the novel coronavirus (COVID-19) spread, the exacerbation of the LNG glut, and delays in delivering new resource projects in PNG. A limited fiscal space and a rigid exchange rate regime constitute constraints for the authorities to react to these shocks, requiring an urgent mobilization of external financial support from the development partners. The government is anticipating a substantial revenue shortfall in the resource sector (as export revenue will be lower) and will have to revise some of its investment plans due to the expected shortage of domestic funding available. To mitigate this shortfall, the government has already applied for the additional COVID-19 financing facilities established by the multilateral development partners. Despite these measures, the overall fiscal deficit is expected to widen further, putting additional pressure on public debt which is estimated to exceed the legislated ceiling of 45 percent of GDP. The Bank is supporting GoPNG through preparation of a potential development policy operation in 2020. The IMF is assisting with preparation of a Balance of Payments support package under its Rapid Credit Facility, for possible consideration by the IMF Board in April 2020. 134. Stakeholder risk - High. Ensuring adequate consultations and global experience sharing on DLI approaches with the NDOH, PHAs, central agencies and other key stakeholders will be critical to manage the risks associated with the introduction of results-based financing as well as stakeholder risk in a heavily decentralized sector. Consultations will continue throughout the preparation process. A government to government experience sharing on DLIs between the Governments of Lao PDR and PNG is on-going. 135. Project design features seek to manage some of the risks associated with implementing DLIs in a low technical capacity context. DLIs are introduced in a phased manner starting with the Early Adopter Provinces and potentially expanding to an additional two Expansion Provinces in Year 3. Furthermore, Competitive DLIs which all PHA Provinces will be eligible for, will also be introduced in Year 3. This phased expansion will allow for learning from experience and also reduce the strain on implementation capacity. Most DLIs are scalable allowing for possible disbursements against partial achievement. Reporting and verification of DLI results is based on information collected through the eNHIS or in the course of routine supervision visits or Project management. The latter serves to reduce the administrative burden of a DLI approach while independent verification can serve to increase the credibility of routinely reported/ collected data. The Project also includes input-based financing to build readiness to achieve results in the four Early Adopter and Expansion Provinces. 136. A PPG (financed by Australia’s DFAT), is expected to help mitigate many of the risks identified. The PPG is being used to procure PCU staff, including a Project Coordinator, Financial Management and Procurement expertise, as well as to initiate preparatory tasks for implementation prior to Project effectiveness to improve the pace and quality of implementation. 137. Fiduciary Risks – High. The Project’s overall financial management risk is rated as “High”. A procurement risk assessment of the implementing agency, NDOH, has been completed, and the overall risk rating is “Substantial”. The NDOH has recent experience working with the World Bank and applying the then newly instituted policies and procedures, but there has been a lag in contracting of procurement support. In the absence of the anticipated technical assistance being onboard, the work has fallen to the existing staff in NDOH, who received hands-on expanded implementation support (a first use of this mechanism). There is risk due to the complex and lengthy GoPNG procurement processes that needs to be navigated, and the overall capacity of the NDOH to implement a World Bank- financed operation still needs to be improved. Every effort is being made to ensure the procurement activities are packaged and prepared in such a way that they expedite implementation. Even so, for procurement requiring GoPNG approval at a central level (Central Supply and Tenders Board/National Procurement Commission) (but not requiring approval of the National Executive Council - procurements that exceed PGK 10 million or currently US$3.16 million equivalent), these have in some instances required more than 12 months to process. One of the proposed ways to Page 41 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) mitigate the risk of lengthy delays to implementation is to include the Direct Selection of United Nations Agencies in the Procurement Plan; this will also ensure that organizations that are uniquely qualified are able to be engaged in an efficient manner. A financial management risk assessment of the implementing agency, NDOH, has been completed, and the overall risk rating is “High”. Although PFM systems in PNG are adequate, compliance with the systems, including by NDOH, is weak. Discussions with NDOH and supported by findings in internal and external audit reports, along with Mid-Year Economic and Fiscal Outlook and Final Budget Outcome, which identify a number of financial management problems in terms of budget releases, fund flows, tracking expenditures, acquittals, record keeping, ensuring value-for- money, using funds for intended projects and programs. Additionally, as the proposed DLIs EEP is 100% salaries and allowances, the identified weaknesses in PNG’s accounting system and controls for personnel management, i.e. payroll controls are weak, agencies are not complying with General Orders, Public Finance Management Act, business processes for Human Resources and payroll management57 and the significant cost over runs in NDOH salaries and allowances i.e. 50 percent overrun in 201858, contribute to the “High” risk rating. 138. Political and governance - High. The political landscape in PNG is highly fragmented and the ongoing decentralization has increased political instability. Furthermore, the establishment of the PHAs has exacerbated the tension between different levels of government, and in some cases, it has also highlighted limited political commitment at the provincial level to support the national reform agenda in the health sector. The introduction of performance- based management is expected to align incentives for province- and national-level stakeholders to cooperate. It is also expected that IMPACT Health will improve the governance of the health sector by strengthening NDOH’s oversight role and PHA’s service delivery functions, therefore establishing clear accountability lines within the sector. 139. Social risks – Moderate. Low social cohesion is an important driver of tribal fights, which in turn pose an important risk to the safety of health workers, particularly those that participate in outreach patrols and travel to remote and hard- to-reach areas. A common practice to mitigate this risk consists of the validation of service delivery plans with local authorities and community leaders; PHAs will be encouraged to follow a similar strategy. Moreover, if PHAs enter into contractual arrangements with third parties to deliver health services, PHAs will favor those organizations that already have an existing connection with local communities and employ local staff to deliver services. 140. Institutional capacity for implementation and Sustainability - Substantial. In-house capacity at the NDOH and the PHAs is low, and experience implementing World Bank-financed support is limited. Despite ongoing efforts to strengthen role delineation in the health sector, accountability lines and monitoring and evaluation arrangements are evolving. It is expected that entering into a contractual arrangement for the implementation of this Project will help mitigate some of these risks by elucidating roles and responsibilities. Key areas, such as procurement, and financial management, among others, will be supported through contracting of these skills to support the dedicated PCU in NDOH. TA will also be provided to the PHAs in Selected Provinces (at least in the start-up of the Project) for the PHAs’ capacity to be built to take over Project related responsibilities. Furthermore, phased implementation and other design features, for example use of administrative or program data to report on DLIs, will serve to moderate implementation capacity demands on the NDOH. . 57 PEFA roadmap 2015-2018 58 2018 Final Budget Outcomes Page 42 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) VI. RESULTS FRAMEWORK AND MONITORING Results Framework COUNTRY: Papua New Guinea Improving Access to and Value from Health Services in PNG: Financing the Frontlines Project Development Objectives(s) The development objective is to contribute to increasing the utilization of quality essential health services in Project-supported provinces of the Recipient. Project Development Objective Indicators RESULT_FRAME_T BL_ PD O Indicator Name DLI Baseline Intermediate Targets End Target 1 2 3 To improve the quality of essential health services (a) For Early Adopter (a) For Early Adopter (a) For Early Adopter Provinces (first two Selected Provinces (first two Selected Provinces (first two Selected Provinces): Percentage of Provinces): Percentage of Provinces): Eligible Level 2-4 Health Care Eligible Level 2-4 Health Care Percentage of Eligible Level Facilities in each Early Facilities in each Early At least ninety percent (90%) 2-4 Health Care Facilities in of Eligible Level 2-4 Health Adopter Province that have Adopter Province that have each Early Adopter Province Percentage of Eligible Level 2-4 Care Facilities in each Early achieved a Minimum Service achieved a Minimum Service that have achieved a Integrated Facility Quality Score is at least ten Quality Score is at least Health Care Facilities in Selected Adopter Province (first two Minimum Service Quality Supervision Checklist to percent (10%) over the twenty percent (20%) over Provinces that have achieved a DLI 6 Selected Provinces) have Score is at least thirty measure quality not Baseline. (b) For Expansion the Baseline. (b) For Minimum Service Quality Score service quality measured percent (30%) over the implemented Provinces (subsequent two Expansion Provinces (Text) through the Integrated Baseline. Selected Provinces): At least (Subsequent two Selected Facility Supervision (b) For Expansion Provinces Checklist. ninety percent (90%) of Provinces): Percentage of Eligible Level 2-4 Health Care Eligible Level 2-4 Health Care (subsequent two Selected Provinces): Facilities in each Expansion Facilities in each Expansion Province have service quality Province that have achieved Percentage of Eligible Level measured through the a Minimum Service Quality 2-4 Health Care Facilities in Integrated Facility Score is at least ten percent each Expansion Province Page 43 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) RESULT_FRAME_T BL_ PD O Indicator Name DLI Baseline Intermediate Targets End Target 1 2 3 Supervision Checklist. (10%) over the Baseline. that have achieved a Minimum Service Quality Score is at least twenty percent (20%) over the Baseline. To increase the utilization of essential health services Twenty-five percent (25%) Fifteen percent (15%) Twenty percent (20%) increase in the number of increase in the number of increase in the number of Outreach Visits over the Outreach Visits over the Outreach Visits over the Baseline in each Early Ten percent (10%) increase Baseline in each Early Baseline in each Early Adopter Province (first two in the number of Outreach Adopter Province (first two Adopter Province (first two Selected Provinces). Percentage increase in the number Visits over the Baseline in Selected Provinces). Ten Selected Provinces). Fifteen of Outreach Visits in Selected DLI 8 0% Twenty percent (20%) each Early Adopter Province percent (10%) increase in percent (15%) increase in Provinces (Text) increase in the number of (first two Selected the number of Outreach the number of Outreach Outreach Visits over the Provinces). Visits over the Baseline in Visits over the Baseline in Baseline in each Expansion each Expansion Province each Expansion Province Province (Subsequent two (subsequent two Selected (subsequent two Selected Selected Provinces). Provinces). Provinces). Thirty percent (30%) Ten percent (10%) increase Twenty percent (20%) increase over baseline for over baseline for Early increase over baseline for Early Adopter Provinces (first Percentage increase in the number Adopter Provinces (first two Early Adopter Provinces (first two Selected Provinces) of pregnant women who have Selected Provinces). Five two Selected Provinces). Ten Zero percent (0%) Twenty percent (20%) received four or more antenatal percent (5%) increase over percent (10%) increase over care check-ups (Text) increase over baseline for baseline for Expansion baseline for Expansion Provinces (subsequent two Provinces (subsequent two Expansion Provinces Selected Provinces) Selected Provinces) (subsequent two Selected Provinces) Page 44 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) RESULT_FRAME_T BL_ PD O Indicator Name DLI Baseline Intermediate Targets End Target 1 2 3 Thirty percent (30%) Ten percent (10%) increase Twenty percent (20%) increase over baseline for over baseline for Early increase over baseline for Early Adopter Provinces (first Adopter Provinces (first two Early Adopter Provinces (first two Selected Provinces) Percentage increase in the number Zero percent (0%) Selected Provinces). Five two Selected Provinces). Ten Twenty percent (20%) of children under one year of age percent (5%) increase over percent (10%) increase over increase over baseline for who have received DPT-3 (Text) baseline for Expansion baseline for Expansion Expansion Provinces Provinces (subsequent two Provinces (subsequent two (subsequent two Selected Selected Provinces) Selected Provinces) Provinces) Thirty percent (30%) Ten percent (10%) increase Twenty percent (20%) increase over baseline for over baseline for Early increase over baseline for Early Adopter Provinces (first Increase in the number of Adopter Provinces (first two Early Adopter Provinces (first two Selected Provinces) registered DSTB patients on Zero percent (0%) Selected Provinces). Five two Selected Provinces). Ten Twenty percent (20%) treatment who have been cured percent (5%) increase over percent (10%) increase over increase over baseline for (Text) baseline for Expansion baseline for Expansion Expansion Provinces Provinces (subsequent two Provinces (subsequent two (subsequent two Selected Selected Provinces) Selected Provinces) Provinces) PDO Table SPACE Intermediate Results Indicators by Components RESULT_FRAME_T BL_ IO Indicator Name DLI Baseline Intermediate Targets End Target 1 2 3 4 Component 1: Increase service delivery readiness and community-based service delivery Number of staff trained in At least 10 % of eligible At least 20 % of eligible At least 30 % of eligible At least 40 % of eligible At least 50 % of eligible RMNCH-N and PFM under the None staff was trained in each staff was trained in each staff was trained in each staff was trained in each staff was trained in each Project (Text) of the Selected of the Selected of the Selected of the Selected of the Selected Provinces Page 45 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) RESULT_FRAME_T BL_ IO Indicator Name DLI Baseline Intermediate Targets End Target 1 2 3 4 Provinces Provinces Provinces Provinces. Pilots designed and Innovations for community- based service delivery trialed implementation begins Pilots evaluated in Early One innovation Innovations not in Early Adopter Adopter provinces (first implemented in each of and scaled up in Selected implemented Provinces (Text) Provinces (first two two Selected Provinces) the Selected Provinces Selected Provinces) Forty percent (40%) Twenty percent (20%) Thirty percent (30%) increase over baseline for increase over baseline increase over baseline Early Adopter Provinces for Early Adopter for Early Adopter (first two Selected Percentage of health facilities Ten percent (10%) that have implemented patient To be established in Year Provinces (first two Provinces (first two Provinces) increase over baseline 2 for Early Adopter Selected Provinces). Ten Selected Provinces). feedback mechanisms and for Early Adopter Thirty percent (30%) responded to issues identified Provinces and Year 3 for percent (10%) increase Twenty percent (20%) Provinces (first two increase over baseline for (Text) Expansion Provinces over baseline for increase over baseline Selected Provinces) Expansion Provinces Expansion Provinces for Expansion Provinces (subsequent two Selected (subsequent two (subsequent two Provinces) Selected Provinces) Selected Provinces) Component 2: Improve frontline service delivery performance Transfer of PHA Transfer of PHA Transfer of PHA Transfer of PHA Transfer of PHA Performance Funds from Performance Funds from Performance Funds from Performance Funds from Performance Funds from NDOH within 10 working NDOH within 10 working NDOH within 10 working NDOH within 10 working NDOH within 10 working days of the date of days of the date of days of the date of days of the date of Timely transfer of PHA No transfer of PHA days of the date of receipt Performance Funds (Text) DLI 3 receipt of an equivalent receipt of an equivalent receipt of an equivalent receipt of an equivalent Performance Funds of an equivalent amount amount of financing amount of financing amount of financing amount of financing of financing proceeds proceeds from the proceeds from the proceeds from the proceeds from the from the World Bank for World Bank for such World Bank for such World Bank for such World Bank for such such purpose purpose purpose purpose purpose National Performance National Performance National Performance National Performance National Performance National Performance No National Performance Dashboard updated and Dashboard developed and Dashboard developed Dashboard updated and Dashboard updated and Dashboard updated and Dashboard available online updated (Text) and adopted by NDOH available online available online available online Page 46 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) RESULT_FRAME_T BL_ IO Indicator Name DLI Baseline Intermediate Targets End Target 1 2 3 4 Annual Implementation Annual Implementation Annual Implementation Annual Implementation Number of Selected PHAs with Annual Implementation Plans submitted in a Plans submitted in a Plans submitted in a Plans submitted in a a complete Annual Baseline value to be Plans submitted in a timely manner and to timely manner and to timely manner and to timely manner and to Implementation Plan determined upon timely manner and to DLI 5 NDOH specification in NDOH specification in NDOH specification in NDOH specification in submitted in a timely manner selection of Provinces NDOH specification in each of the Early each of the Early each of the Selected each of the Selected and in accordance with NDOH each of the Selected Adopter Provinces (first Adopter Provinces (first Provinces Provinces specifications (Text) Provinces two Selected Provinces). two Selected Provinces). Provincial Performance Dashboard updated and annual Supportive A Provincial Provincial Performance Supervision Plan Provincial Performance Provincial Performance No PHA has a Provincial Performance Dashboard Dashboard updated and prepared in each Early Dashboard updated and Dashboard updated and Number of PHA Boards that Performance Dashboard; has been developed and annual Supportive Adopter province. A annual Supportive annual Supportive have used routine data for DLI 7 No PHA has a Supportive adopted by the PHA Supervision Plan Provincial Performance Supervision Plan Supervision Plan prepared decision making (Text) Supervision Plan Board in each Early prepared in each Early Dashboard has been prepared in each in each Selected Province Adopter Province. Adopter province. developed and adopted Selected Province by the PHA Board in each Expansion Province. IO Table SPACE UL Table SPACE Monitoring & Evaluation Plan: PDO Indicators Methodology for Data Responsibility for Data Indicator Name Definition/Description Frequency Datasource Collection Collection Percentage of Eligible Level 2-4 Health Percentage of district Integrated Data from district PHA to assign office Care Facilities in Selected Provinces that hospitals, rural health Annual Facility hospitals, rural health responsible have achieved a Minimum Service Quality centers and Community Supervision centers and Community Score Health Posts in Selected Checklist Health Posts collected Page 47 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Provinces achieving at least during routine a minimum quality score on supervision visits and the NDOH adopted submitted to the PHA Integrated Facility Supervision Checklist Percentage increase in the Data reported by PHA to assign office Percentage increase in the number of number of Outreach Visits Annual eNHIS facilities responsible Outreach Visits in Selected Provinces each year (in Selected Provinces) over baseline Percentage increase in the number of pregnant women Percentage increase in the number of who have received four or Data reported by PHA to assign office Annual eNHIS pregnant women who have received four more antenatal care check- facilities responsible or more antenatal care check-ups ups (in Selected Provinces) over baseline Percentage increase in the Percentage increase in the number of number of children under Data reported by PHA to assign the office Annual eNHIS children under one year of age who have one year of age who have facilities responsible received DPT-3 received DPT-3 over baseline PHA TB quarterly Increase in the number of reports and Increase in the number of registered DSTB Data reported by Basic PHA to assign office registered DSTB patients on Annual Basic patients on treatment who have been Management Units responsible treatment who have been Management cured cured over baseline Units registers ME PDO Table SPACE Page 48 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Monitoring & Evaluation Plan: Intermediate Results Indicators Methodology for Data Responsibility for Data Indicator Name Definition/Description Frequency Datasource Collection Collection Training attendance Reports by Number of staff trained in RMNCH-N and Number of staff Annual sheets submitted by PHA designated office PHA PFM under the Project participating in training PHA Contracted NGO or Church service provider Innovations for community-based service implementing community- Annual PHA PHA records PHA designated office delivery trialed and scaled up in Selected based service delivery Provinces innovation in line with proposal received Percentage of health facilities that implemented patient feedback mechanisms and responded to issues identified. The Integrated Percentage of health facilities that have health facilities in the Facility implemented patient feedback denominator would be level Annual Data from the facilities PHAs Supervision mechanisms and responded to issues 2-4 facilities in the four Checklist identified selected Early Adopter and Expansion Provinces. The indicator will be measured through the Integrated Facility Supervision Checklist. Transfer of PHA Timely transfer of PHA Performance Performance Funds from Annual NDOH NDOH records NDOH Funds NDOH within 10 working days of the date of receipt Page 49 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) of an equivalent amount of financing proceeds from the World Bank for such purpose National Performance Dashboard developed, National Performance Dashboard updated annually and Annual NDOH NDOH records NDOH developed and updated published on the NDOH website PHAs in Selected Provinces have correctly prepared an Number of Selected PHAs with a complete Annual Implementation Plan PHA board to submit by PHA Board in Selected Annual Implementation Plan submitted in using NDOH's template and Annual NDOH email to NDOH Provinces a timely manner and in accordance with submitted it to NDOH NDOH specifications before the deadline identified in NDOH's budget circular. (i) Province performance dashboard for use by PHA PHA Board to submit Board developed and records with updated every six months Provincial Performance PHA Board in Selected Number of PHA Boards that have used using eNHIS data; and (ii) Annual PHA records Dashboard, order of Provinces routine data for decision making Supportive Supervision Plan adoption and to address performance Supportive Supervision concerns adopted by PHA Plan Board ME IO Table SPACE Page 50 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Disbursement Linked Indicators Matrix DLI_T BL_MATRI X DLI 1 N-DLI 1: Memoranda of Understanding (MoU) signed with up to 4 Selected Provincial Health Authorities (PHAs) Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Output Yes Text 600,000.00 4.10 Period Value Allocated Amount (USD) Formula Baseline No MoU signed Year 1 NDOH has signed a Memorandum of 300,000.00 150,000/MoU signed; up to 2 MoUs. Understanding with at least one (1) Selected Time-bound within Year1 PHA. Targeted for up to two (2) Memoranda of Understanding signed. Year 2 0.00 Year 3 NDOH has signed a Memorandum of 300,000.00 150,000/MoU signed; up to 2 Understanding with at least one (1) additional MoUs.Time-bound within Years 2-5 Selected PHA. Targeted for up to two (2) additional Memoranda of Understanding signed. Year 4 0.00 Year 5 0.00 DLI_T BL_MATRI X DLI 2 N-DLI 2: Integrated Facility Supervision Checklist adopted and updated Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Output No Text 600,000.00 2.70 Period Value Allocated Amount (USD) Formula Page 51 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Baseline No Integrated Facility Supervision Checklist implemented Year 1 NDOH has adopted an Integrated Facility 300,000.00 Not time-bound Supervision Checklist by issuing an operational directive. Year 2 0.00 Year 3 NDOH has: (a) reviewed and updated the 300,000.00 Not time-bound adopted Integrated Facility Supervision Checklist in accordance with the criteria set forth in the DLI Operational Manual; and (b) adopted the updated Integrated Facility Supervision Checklist by issuing an operational directive. Year 4 0.00 Year 5 0.00 DLI_T BL_MATRI X DLI 3 N-DLI 3: Timely transfer of PHA Performance Funds Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Output Yes Text 1,500,000.00 10.30 Period Value Allocated Amount (USD) Formula Baseline No transfer of PHA Performance Funds Year 1 NDOH has transferred PHA Performance Funds, 300,000.00 150,000/PHA;up to 2 Selected in the amount calculated in accordance with the PHAs.Not time-bound DLI Operational Manual, to at least one (1) Selected PHA within ten (10) working days from Page 52 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) the date the Recipient has received an equivalent amount of Financing proceeds from the Association for the achievement of the relevant DLI Target(s) for Year 1.Targeted for transfers made to up to two (2) Selected PHAs. Year 2 NDOH has transferred PHA Performance Funds, 300,000.00 150,000/PHA;up to 2 Selected in the amount calculated in accordance with the PHAs.Not time-bound DLI Operational Manual, to at least one (1) Selected PHA within ten (10) working days from the date the Recipient has received an equivalent amount of Financing proceeds from the Association for the achievement of the relevant DLI Target(s) for Year 2. Targeted for transfers made to up to two (2) Selected PHAs. Year 3 NDOH has transferred PHA Performance Funds, 300,000.00 75,000/PHA; up to 4 Selected in the amount calculated in accordance with the PHAs.Not time-bound DLI Operational Manual, to at least one (1) Selected PHA within ten (10) working days from the date the Recipient has received an equivalent amount of Financing proceeds from the Association for the achievement of the relevant DLI Target(s) for Year 3. Targeted for transfers made to up to four (4) Selected PHAs. Year 4 NDOH has transferred PHA Performance Funds, 300,000.00 75,000/PHA; upto 4 Selected in the amount calculated in accordance with the PHAs.Not time-bound DLI Operational Manual, to at least one (1) Selected PHA within ten (10) working days from the date the Recipient has received an equivalent amount of Financing proceeds from the Page 53 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Association for the achievement of the relevant DLI Target(s) for Year 4. Targeted for transfers made to up to four (4) Selected PHAs. Year 5 NDOH has transferred PHA Performance Funds, 300,000.00 75,000/PHA;upto 4 Selected in the amount calculated in accordance with the PHAs.Not time-bound. DLI Operational Manual, to at least one (1) Selected PHA within ten (10) working days from the date the Recipient has received an equivalent amount of Financing proceeds from the Association for the achievement of the relevant DLI Target(s) for Year 5. Targeted for transfers made to up to four (4) Selected PHAs. DLI_T BL_MATRI X DLI 4 N-DLI 4: Number of Selected Provinces that have achieved all Provincial DLIs. Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Output Yes Text 1,000,000.00 6.80 Period Value Allocated Amount (USD) Formula Baseline No annual targets met Year 1 At least one (1) Selected Province has fully 200,000.00 100,000 / Selected Province; up to achieved DLI Targets of all Provincial DLIs for Year 2. Time-bound 1. Targeted for up to two (2) Selected Provinces. Year 2 At least one (1) Selected Province has fully 200,000.00 100,000 / Selected Province; up to achieved DLI Targets of all Provincial DLIs for Year 2. Time-bound 2. Targeted for up to two (2) Selected Provinces. Year 3 At least one (1) Selected Province has fully 200,000.00 50,000 / Selected Province; up to 4. achieved DLI Targets of all Provincial DLIs for Year Page 54 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) 3. Targeted for up to four (4) Selected Provinces. Time-bound Year 4 At least one (1) Selected Province has fully 200,000.00 50,000 / Selected Province; up to 4. achieved DLI Targets of all Provincial DLIs for Year Time-bound 4. Targeted for up to four (4) Selected Provinces. Year 5 At least one (1) Selected Province has fully 200,000.00 50,000 / Selected Province; up to 4. achieved DLI Targets of all Provincial DLIs for Year Time-bound 5. Targeted for up to four (4) Selected Provinces. DLI_T BL_MATRI X P-DLI 1: Number of Selected PHAs with a complete Annual Implementation Plan submitted in a timely manner and in DLI 5 accordance with NDOH specifications Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Output Yes Text 1,600,000.00 11.00 Period Value Allocated Amount (USD) Formula Baseline Baseline value to be determined upon selection of Provinces Year 1 At least one (1) Selected PHA has prepared and 200,000.00 100,000 / Selected PHA; up to 2 submitted to NDOH, a complete Annual PHAs. Time-bound Implementation Plan, before the due date identified in the relevant NDOH’s budget circular. Targeted for up to two (2) Selected PHAs. Year 2 At least one (1) Selected PHA has prepared and 200,000.00 100,000 / Selected PHA; up to 2 submitted to NDOH, a complete Annual PHAs. Time-bound Implementation Plan, before the due date identified in the relevant NDOH’s budget circular. Targeted for up to two (2) Selected PHAs. Page 55 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Year 3 At least one (1) Selected PHA has prepared and 400,000.00 100,000 / Selected PHA; up to 4 submitted to NDOH, a complete Annual PHAs. Time-bound Implementation Plan, before the due date identified in the relevant NDOH’s budget circular. Targeted for up to four (4) Selected PHAs. Year 4 At least one (1) PHA in a Selected Province has 400,000.00 100,000 / Selected PHA; up to 4 prepared and submitted to NDOH, a complete PHAs. Time-bound Annual Implementation Plan, before the due date identified in the relevant NDOH’s budget circular. Targeted for up to four (4) PHAs in Selected Provinces. Year 5 At least one (1) Selected PHA has prepared and 400,000.00 100,000 / Selected PHA; up to 4 submitted to NDOH, a complete Annual PHAs. Time-bound Implementation Plan, before the due date identified in the relevant NDOH’s budget circular. Targeted for up to four (4) Selected PHAs. DLI_T BL_MATRI X P-DLI 2: Percentage of Eligible Level 2-4 Health Care Facilities in Selected Provinces that have achieved a Minimum Service DLI 6 Quality Score Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Output Yes Text 2,100,000.00 14.40 Period Value Allocated Amount (USD) Formula Baseline Integrated Facility Supervision Checklist not implemented Year 1 0.00 Page 56 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Year 2 For Early Adopter Provinces: At least ninety 300,000.00 150,000 / Early Adopter Pronvince, percent (90%) of Eligible Level 2-4 Health Care up to 2. Time-bound Facilities in an Early Adopter Province have service quality measured through the Integrated Facility Supervision Checklist. Targeted in up to two (2) Early Adopter Provinces. Year 3 (a) For Early Adopter Provinces: Percentage of 600,000.00 150,000 / Province, up to 4. Time- Eligible Level 2-4 Health Care Facilities in an Early bound Adopter Province that have achieved a Minimum Service Quality Score on the Integrated Facility Supervision Checklist is at least ten percent (10%) over the Baseline. Targeted in up to two (2) Early Adopter Provinces. (b) For Expansion Provinces: At least ninety percent (90%) of Eligible Level 2-4 Health Care Facilities in an Expansion Province have service quality measured through the Integrated Facility Supervision Checklist. Targeted in up to two (2) Expansion Provinces. Year 4 (a) For Early Adopter Provinces: Percentage of 600,000.00 150,000 / Province, up to 4. Time- Eligible Level 2-4 Health Care Facilities in an Early bound Adopter Province that have achieved a Minimum Service Quality Score on the Integrated Facility Supervision Checklist is at least twenty percent (20%) over the Baseline. Targeted in up to two (2) Early Adopter Provinces. (b) For Expansion Provinces: Percentage of Eligible Level 2-4 Health Care Facilities in an Expansion Province that have achieved a Minimum Service Quality Score on the Integrated Facility Supervision Checklist is at least ten percent (10%) over the Baseline. Targeted in Page 57 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) up to two (2) Expansion Provinces. Year 5 (a) For Early Adopter Provinces: Percentage of 600,000.00 150,000 / Province, up to 4. Time- Eligible Level 2-4 Health Care Facilities in an Early bound Adopter Province that have achieved a Minimum Service Quality Score on the Integrated Facility Supervision Checklist is at least thirty percent (30%) over the Baseline. Targeted in up to two (2) Early Adopter Provinces. (b) For Expansion Provinces: Percentage of Eligible Level 2-4 Health Care Facilities in an Expansion Province that have achieved a Minimum Service Quality Score on the Integrated Facility Supervision Checklist is at least twenty percent (20%) over the Baseline. Targeted in up to two (2) Expansion Provinces. DLI_T BL_MATRI X DLI 7 P-DLI 3: Number of PHA Boards that have used routine data for decision making Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Output Yes Text 1,200,000.00 5.50 Period Value Allocated Amount (USD) Formula Baseline No PHA has a Provincial Performance Dashboard; No PHA has a Supportive Supervision Plan Year 1 For Early Adopter Provinces:A Provincial 150,000.00 75,000/ Early Adopter Province,up Performance Dashboard has been developed and to 2. Time-bound adopted by the PHA Board, in at least one (1) Early Adopter Province.Targeted in up to two (2) Early Adopter Provinces. Page 58 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Year 2 For Early Adopter Provinces: (a) Provincial 150,000.00 75,000/ Early Adopter Province, up Performance Dashboard in at least one (1) Early to 2. Time-bound Adopter Province has been updated every six (6) months in accordance with the DLI Operational Manual; and (b) PHA Board of such Province has adopted a Supportive Supervision Plan. Targeted in up to two (2) Early Adopter Provinces. Year 3 (a) For Early Adopter Provinces: (i) Provincial 300,000.00 75,000/ Selected Province, up to Performance Dashboard in at least one (1) Early 4.Time-bound Adopter Province has been updated every six (6) months in accordance with the DLI Operational Manual; and (ii) PHA Board of such Province has adopted a Supportive Supervision Plan. Targeted in up to two (2) Early Adopter Provinces. (b) For Expansion Provinces: A Provincial Performance Dashboard has been developed and adopted by the PHA Board, in at least one (1) Expansion Province. Targeted in up to two (2) Expansion Provinces. Year 4 (a) Provincial Performance Dashboard in at least 300,000.00 75,000/ Selected Province, up to 4. one (1) Selected Province has been updated Time-bound every six (6) months in accordance with the DLI Operational Manual; and (b) PHA Board of such Province has adopted a Supportive Supervision Plan. Targeted in up to four (4) Selected Provinces. Year 5 (a) Provincial Performance Dashboard in at least 300,000.00 75,000/ Selected Province, up to one (1) Selected Province has been updated 4.Time-bound every six (6) months in accordance with the DLI Page 59 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Operational Manual; and (b) PHA Board of such Province has adopted a Supportive Supervision Plan to address performance concerns. Targeted in up to four (4) Selected Provinces. DLI_T BL_MATRI X DLI 8 P-DLI 4: Percentage increase in the number of Outreach Visits in Selected Provinces Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Output Yes Text 2,100,000.00 14.40 Period Value Allocated Amount (USD) Formula Baseline 0% Year 1 0.00 Year 2 For Early Adopter Provinces: At least one percent 300,000.00 Up to 150,000 / Early Adopter (1%) and up to ten percent (10%) increase in the Province;up to 2. Time-bound number of Outreach Visits over the Baseline in an Early Adopter Province. Targeted in up to (2) Early Adopter Provinces. Year 3 (a) For Early Adopter Provinces: At least eleven 600,000.00 Up to 150,000/ Selected percent (11%) and up to fifteen percent (15%) Province,upto 4.Time-bound increase in the number of Outreach Visits over the Baseline in an Early Adopter Province. Targeted in up to (2) Early Adopter Provinces.(b) For Expansion Provinces: At least one percent (1%) and up to ten percent (10%) increase in the number of Outreach Visits over the Baseline in an Expansion Province. Targeted in up to (2) Expansion Provinces. Page 60 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Year 4 (a) For Early Adopter Provinces: At least sixteen 600,000.00 Up to 150,000 / Selected Province; percent (16%) and up to twenty percent (20%) up to 4. Time-bound increase in the number of Outreach Visits over the Baseline in an Early Adopter Province. Targeted in up to (2) Early Adopter Provinces. (b) For Expansion Provinces: At least eleven percent (11%) and up to fifteen percent (15%) increase in the number of Outreach Visits over the Baseline in an Expansion Province. Targeted in up to (2) Expansion Provinces. Year 5 (a) For Early Adopter Provinces: At least twenty- 600,000.00 Up to 150,000 / Selected Province, one percent (21%) and up to twenty-five percent up to 4. Time-bound (25%) increase in the number of Outreach Visits over the Baseline in an Early Adopter Province. Targeted in up to (2) Early Adopter Provinces. (b) For Expansion Provinces: At least sixteen percent (16%) and up to twenty percent (20%) increase in the number of Outreach Visits over the Baseline in an Expansion Province. Targeted in up to (2) Expansion Provinces. DLI_T BL_MATRI X DLI 9 C-DLI 1: Percentage increase in the number of pregnant women who have received four or more antenatal care check-ups Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Intermediate Outcome No Text 1,200,000.00 8.20 Period Value Allocated Amount (USD) Formula Baseline 0% Year 1 0.00 Page 61 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Year 2 0.00 Year 3 NDOH has furnished to the Association a report, 400,000.00 400,000.Time-bound in form and substance described in the DLI Operational Manual, setting forth the list of Competitive DLI Provinces with a top two (2) highest percentage increase in the number of pregnant women who have received four (4) or more antenatal care check-ups in Year 3, compared to their respective results in Year 2, as determined in accordance with the details set forth in the DLI Operational Manual. Year 4 NDOH has furnished to the Association a report, 400,000.00 400,000.Time-bound in form and substance described in the DLI Operational Manual, setting forth the list of Competitive DLI Provinces with a top two (2) highest percentage increase in the number of pregnant women who have received four (4) or more antenatal care check-ups in Year 4, compared to their respective results in Year 3, as determined in accordance with the details set forth in the DLI Operational Manual. Year 5 NDOH has furnished to the Association a report, 400,000.00 400,000.Time-bound in form and substance described in the DLI Operational Manual, setting forth the list of Competitive DLI Provinces with a top two (2) highest percentage increase in the number of pregnant women who have received four (4) or more antenatal care check-ups in Year 5, compared to their respective results in Year 4, as Page 62 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) determined in accordance with the details set forth in the DLI Operational Manual. DLI_T BL_MATRI X DLI 10 C-DLI 2: Percentage increase in the number of children aged under one (1) year who have received DPT-3 Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Intermediate Outcome No Text 1,200,000.00 8.20 Period Value Allocated Amount (USD) Formula Baseline 0% Year 1 0.00 Year 2 0.00 Year 3 NDOH has furnished to the Association a report, 400,000.00 400,000.Time-bound in form and substance described in the DLI Operational Manual, setting forth the list of Competitive DLI Provinces with a top two (2) highest percentage increase in the number of children under one (1) year of age who have received DPT-3 in Year 3, compared to their respective results in Year 2, as determined in accordance with the details set forth in the DLI Operational Manual. Year 4 NDOH has furnished to the Association a report, 400,000.00 400,000.Time-bound in form and substance described in the DLI Operational Manual, setting forth the list of Competitive DLI Provinces with a top two (2) highest percentage increase in the number of children under one (1) year of age who have Page 63 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) received DPT-3 in Year 4, compared to their respective results in Year 3, as determined in accordance with the details set forth in the DLI Operational Manual. Year 5 NDOH has furnished to the Association a report, 400,000.00 400,000.Time-bound in form and substance described in the DLI Operational Manual, setting forth the list of Competitive DLI Provinces with a top two (2) highest percentage increase in the number of children under one (1) year of age who have received DPT-3 in Year 5, compared to their respective results in Year 4, as determined in accordance with the details set forth in the DLI Operational Manual. DLI_T BL_MATRI X DLI 11 C-DLI 3: Increase in the number of registered DSTB patients on treatment who have been cured Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Intermediate Outcome No Text 1,500,000.00 10.30 Period Value Allocated Amount (USD) Formula Baseline 0% Year 1 0.00 Year 2 0.00 Year 3 NDOH has furnished to the Association a report, 500,000.00 500,000. Time-bound in form and substance described in the DLI Operational Manual, setting forth the list of Competitive DLI Provinces with a top two (2) Page 64 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) highest increase in the number of registered drug susceptible tuberculosis patients on treatment who have been cured in Year 3, compared to their respective results in Year 2, as determined in accordance with the details set forth in the DLI Operational Manual. Year 4 NDOH has furnished to the Association a report, 500,000.00 500,000. Time-bound in form and substance described in the DLI Operational Manual, setting forth the list of Competitive DLI Provinces with a top two (2) highest increase in the number of registered drug susceptible tuberculosis patients on treatment who have been cured in Year 4, compared to their respective results in Year 3, as determined in accordance with the details set forth in the DLI Operational Manual. Year 5 NDOH has furnished to the Association a report, 500,000.00 500,000. Time-bound in form and substance described in the DLI Operational Manual, setting forth the list of Competitive DLI Provinces with a top two (2) highest increase in the number of registered drug susceptible tuberculosis patients on treatment who have been cured in Year 5, compared to their respective results in Year 4, as determined in accordance with the details set forth in the DLI Operational Manual. Page 65 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Verification Protocol Table: Disbursement Linked Indicators DLI 1 N-DLI 1: Memoranda of Understanding (MoU) signed with up to 4 Selected Provincial Health Authorities (PHAs) Description Memoranda of Understanding (MoUs) signed with up to 4 Selected PHAs Data source/ Agency Strategic Policy and Planning Division, NDOH Verification Entity IVA Compliance specification: - Each MoU will be signed by NDOH with the PHA of a Province (For the purpose of the Project, a Province may include the National Capital District) which has met the selection criteria for participating in Sub-components 1.1-1.3 of the Project as set forth in Project Operational Manual and agreed with the Association (“Selected Province”). “Selected PHA” means the PHA of a Selected Province. Procedure -The MoU will contain terms and conditions set forth in the DLI Operational Manual and Section I.B of Schedule 2 to the Financing Agreement, and satisfactory to the Association. Means of verification: IVA will review: (i) each fully executed MoU to verify that the MoU was prepared, and contains details, as described above; and (ii) documentation relating to the selection of the relevant Selected Province. DLI 2 N-DLI 2: Integrated Facility Supervision Checklist adopted and updated Description Integrated Facility Supervision Checklist for PHA supervision of service delivery adopted and updated Data source/ Agency Public Health Division, NDOH Verification Entity IVA Compliance specification: -The Integrated Facility Supervision Checklist, which will be used by Selected PHAs in their supervision of service delivery, Procedure will be developed and adopted by NDOH in accordance with the criteria and details set forth in the DLI Operational Manual. The operational directive adopting the checklist will be issued by the Secretary of NDOH. -The review and update of the adopted Integrated Facility Supervision Checklist will be made in accordance with the criteria Page 66 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) and details set forth in the DLI Operational Manual. The operational directive adopting the updates to the checklist and ensuring its continuing applicability will be issued by the Secretary of NDOH. Means of verification: -To verify the adoption of the checklist, IVA will review: (i) the checklist to verify that it contains the details described above; and (ii) the operational directive issued by Secretary of NDOH. -To verify the update and adoption of the updated checklist, IVA will review: (i) the updates to the checklist to verify that the updates are made as described above; and (ii) the operational directive issued by Secretary of NDOH. DLI 3 N-DLI 3: Timely transfer of PHA Performance Funds Description Timely transfer of PHA Performance Funds from the NDOH to Selected PHAs in 10 working days or less. Data source/ Agency Corporate Services Division, NDOH Verification Entity IVA Compliance specification: PHA Performance Funds are funds from NDOH’s budget, which are allocated to the Selected Provinces for their achievement of DLI targets. Means of verification: IVA will: (i) review its verification document/report for the achievement of DLI targets by Selected Provinces in a Year; (ii) Procedure verify the amount of PHA Performance Funds to be transferred to the respective Selected PHAs, as calculated in accordance with the DLI Operational Manual; and (iii) review bank statements with proof of transfer of the relevant portions of the IDA proceeds from the Association to PNG and the corresponding transfer of PHA Performance Funds from NDOH to selected PHAs, and their timing. DLI 4 N-DLI 4: Number of Selected Provinces that have achieved all Provincial DLIs. Indicator to be disbursed when at least one of the Selected Provinces eligible for P-DLIs 1-4 has met annual targets for all 4 Description indicators. Each PHA must meet all targets for the year to be eligible. Data source/ Agency Strategic Policy and Planning Division, NDOH Page 67 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Verification Entity IVA Compliance specification: IVA will confirm the number of Selected Provinces that have fully achieved all 4 P-DLI targets in a Year. Partial achievement of scalable targets will not be considered. Procedure Means of verification: IVA will review its verification report for results of the 4 P-DLIs in each Year. P-DLI 1: Number of Selected PHAs with a complete Annual Implementation Plan submitted in a timely manner and in DLI 5 accordance with NDOH specifications Number of PHAs in Selected Provinces that have submitted complete Annual Implementation Plans in a timely manner and Description to NDOH specifications. Data source/ Agency Strategic Policy and Planning Division, NDOH; PHA Board in Selected Provinces Verification Entity IVA Compliance specification: Each Selected PHA will prepare an Annual Implementation Plan in accordance with the guidelines issued by NDOH and details set forth in the DLI Operational Manual. The plan will also outline key activities and associated budgets linked to the national health plan and other relevant documents. It will be submitted to NDOH before the due date identified in the relevant NDOH budget circular. Procedure Means of verification: IVA will review: (i) each plan to verify that it was prepared and contains details as described above; (ii) the relevant NDOH budget circular for the submission due date; and (iii) the documentation evidencing the submission date of the plan to verify that it has been submitted before the due date. P-DLI 2: Percentage of Eligible Level 2-4 Health Care Facilities in Selected Provinces that have achieved a Minimum Service DLI 6 Quality Score Percentage of Eligible Level 2-4 Health Care Facility in Selected Provinces achieving a minimum service quality threshold (For Description purposes of the Project, “Eligible Level 2-4 Health Care Facilities” in a Selected Province include health care facilities managed by GoPNG and/or churches within a Selected Province, which are classified as levels 2, 3 or 4 in accordance with Page 68 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) the National Health Service Standards, or other equivalent classification acceptable to the World Bank, and as listed in the DLI Operational Manual). Data source/ Agency Strategic Policy and Planning Division, NDOH; PHA Board in Selected Provinces Verification Entity IVA Compliance specification: - To determine that an Eligible Level 2-4 Health Care Facility in a Selected Province has service quality measured through the Integrated Facility Supervision Checklist, such facility must have completed the Integrated Facility Supervision Checklist on tablets, in accordance with the process and details set forth in the DLI Operational Manual (The first two Provinces selected to participate under the Project as Selected Provinces are referred to as “Early Adopter Provinces”. The third and fourth Provinces selected to participate under the Project as Selected Provinces are referred to as “Expansion Provinces”). -To determine that an Eligible Level 2-4 Health Care Facility has achieved a Minimum Service Quality Score on the Integrated Facility Supervision Checklist, such facility must meet the minimum score set forth in the DLI Operational Manual to reflect its minimal service delivery quality level. -Baseline under this P-DLI will be established in Year 2 for Early Adopter Provinces and in Year 3 for Expansion Provinces. At least 90% of Eligible Level 2-4 Health Care Facilities in a Selected Province will be included in the Baseline calculation. NDOH will update the DLI Operational Manual to reflect the Baseline once established. The Baseline to be used for verification will Procedure be the Baseline recorded in the DLI Operational Manual. -The collection method for using the Integrated Facility Supervision Checklist to determine the Baseline and the Minimum Service Quality Score must be in accordance with the DLI Operational Manual, including that it is administered using a tablet. Means of verification: To verify that an Eligible Level 2-4 Health Care Facility has service quality measured through the Integrated Facility Supervision Checklist, IVA will review the checklist used by each facility to verify that: (i) it is the checklist adopted by the NDOH applicable to the Year; and (ii) the facility has input minimal information on the checklist, as required under the DLI Operational Manual. IVA will also verify that the percentage increase for a Selected Province is accurate. To verify that an Eligible Level 2-4 Health Care Facility have achieved a Minimum Service Quality Score on the Integrated Facility Supervision Checklist, IVA will: (i) review checklist used by each facility to verify that it is the checklist adopted by the NDOH applicable to the Year; (ii) review geo-referencing data generated in the process of completing the checklist to verify Page 69 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) that the data has been inputed at the facilities which have been scored; and (iii) verify that the percentage increase for a Selected Province is accurate. IVA will also conduct site visits to a random sample of facilities in Selected Provinces which claimed to achieve the P-DLI for the Year to verify that the data input by the facility is accurate as per the procedure outlined in the DLI Operational Manual. DLI 7 P-DLI 3: Number of PHA Boards that have used routine data for decision making Provincial Performance Dashboard has been developed and adopted by the PHA Board. Provincial Performance Dashboard to be updated every six months in accordance with DLI Operational Manual using recent (no more than 3 months old) data Description available from eNHIS and Integrated Facility Supervision Checklists. Supportive Supervision Plan to address performance concerns adopted by PHA Board. Only Selected Provinces participate under this P-DLI. Data source/ Agency Strategic Policy and Planning Division, NDOH; PHA Board in Selected Provinces Verification Entity IVA Compliance specification: -A Selected PHA will develop a Provincial Performance Dashboard in accordance with the DLI Operational Manual. The dashboard will set out critical performance data of the Selected PHA. The PHA Board minutes will note the decision to adopt the dashboard for use by the PHA Board. -The dashboard will be updated every 6 months, using recent (no more than 3 months old) data available from eNHIS and Integrated Facility Supervision Checklist. The update will be made in accordance with the details set forth in the DLI Operational Manual. Procedure -A Supportive Supervision Plan will include measures for improving the delivery of Frontline Health Services in the Province and addressing any performance concerns. The plan will be adopted by the PHA Board and documented in the minutes of the relevant PHA Board meeting in accordance with the details set forth in the DLI Operational Manual. Means of verification: To verify that a Provincial Performance Dashboard has been developed and adopted, IVA will review: (i) the initial dashboard to verify that it has been developed as described above; and (ii) the minutes of the relevant PHA Board meeting. To verify the updates to the dashboard and the adoption of a Supportive Supervision Plan, IVA will review: (i) the dashboard to verify that it has been updated as described above; (ii) the plan to verify that it contains the details described above; (iii) Page 70 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) the eNHIS data reports and (iv) PHA Board meeting minutes to confirm adoption of the Supportive Supervision Plan. DLI 8 P-DLI 4: Percentage increase in the number of Outreach Visits in Selected Provinces Description Number of Outreach Visits held in Selected Provinces met the yearly target. Data source/ Agency Public Health Division, NDOH; PHA Board in Selected Provinces. Verification Entity IVA Compliance verification: -Outreach Visits are visits conducted by a health facility staff to a lower level health facility or a community in a Selected Province. The visits will be conducted in accordance with the DLI Operational Manual. -Baseline under this P-DLI per Selected Province will be reflected in the DLI Operational Manual. -The outreach team will update data on services delivered during Outreach Visits at the location using tablet. Means of verification: Procedure IVA will review: (i) the DLI Operational Manual for the Baseline; (ii) eNHIS data reports on Outreach Visits to verify that data for the visit has been inputted in accordance with the DLI Operational Manual; and (iii) the geo-referencing data of the data input on the Outreach Visit for a sub-sample of Outreach Visits reported to verify that the data for the visit was collected during outreach. IVA will also verify the accuracy of the calculation of percentage increase over the Baseline in accordance with the details set forth in the DLI Operational Manual. DLI 9 C-DLI 1: Percentage increase in the number of pregnant women who have received four or more antenatal care check-ups Competitive DLI Provinces ranked number 1 and 2 based on percentage improvement in the number of pregnant women who have received four or more antenatal care check-ups compared to the previous Year. If more than 2 Competitive DLI Provinces were ranked in the top 2 improvers, DLI funds to be split equally (for calculation purposes). “Competitive DLI Description Provinces” include Provinces which have met the selection criteria for participating in C-DLIs as set forth in the DLI Operational Manual and agreed with the Association. Among other criteria, a Province will have to sign an MOU with NDOH in order to be considered as a Competitive DLI Province. Data source/ Agency Public Health Division, NDOH; PHA Board in Competitive DLI Provinces Page 71 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Verification Entity IVA Compliance verification: - The percentage increase will be determined in accordance with the DLI Operational Manual. -The form and substance of the report to be prepared by NDOH will be described in the DLI Operational Manual. Means of verification: IVA will review: (i) documentation relating to the eligibility of the Competitive DLI Provinces; (ii) the report submitted by Procedure NDOH to verify that it contains the information required in the DLI Operational Manual; (iii) the DLI Operational Manual to verify the calculation of percentage increase; and (iv) the eNHIS data. IVA will also conduct facility record reviews and call- backs to a sub-sample of households to verify the data as outlined in the DLI Operational Manual. DLI 10 C-DLI 2: Percentage increase in the number of children aged under one (1) year who have received DPT-3 Competitive DLI Provinces ranked number 1 and 2 based on percentage improvement in the number of children aged under Description one (1) year who have received DPT-3 compared to the previous Year. If more than 2 Competitive DLI Provinces were ranked in the top 2 improvers, DLI funds to be split equally (for calculation purposes). Data source/ Agency Public Health Division, NDOH; PHA Board in Competitive DLI Provinces Verification Entity IVA Compliance verification: -The percentage increase will be determined in accordance with the DLI Operational Manual. -The form and substance of the report to be prepared by NDOH will be described in the DLI Operational Manual. Means of verification: Procedure IVA will review: (i) documentation relating to the eligibility of the Competitive DLI Provinces; (ii) the report submitted by NDOH to verify that it contains the information required in the DLI Operational Manual; (iii) the DLI Operational Manual to verify the calculation of percentage increase; and (iv) the eNHIS data. IVA will also conduct facility record reviews and call- backs to a sub-sample of households to verify the data. Page 72 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) DLI 11 C-DLI 3: Increase in the number of registered DSTB patients on treatment who have been cured Competitive DLI Provinces ranked number 1 and 2 based on improvement in the number of registered DSTB patients on Description treatment who have been cured compared to the previous Year. If more than 2 Competitive DLI Provinces were ranked in the top 2 improvers, DLI funds to be split equally (for calculation purposes). Data source/ Agency Public Health Division, NDOH; PHA Board and Basic Management Units in Competitive DLI Provinces Verification Entity IVA Compliance verification: - The increase will be determined in accordance with the DLI Operational Manual. -The form and substance of the report to be prepared by NDOH will be described in the DLI Operational Manual. Means of verification: Procedure IVA will review: (i) documentation relating to the eligibility of the Competitive DLI Provinces; (ii) the report submitted by NDOH to verify that it contains the information required in the DLI Operational Manual; (iii) the DLI Operational Manual to verify the calculation of the increase; and (iv) National TB Program reporting. IVA will also conduct facility record reviews and call-backs to a sub-sample of households to verify the data. Page 73 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) ANNEX 1: Detailed Project Components Description COUNTRY: Papua New Guinea Improving Access to and Value from Health Services in PNG: Financing the Frontlines (IMPACT Health) 1. IMPACT Health is comprised of four Project components. The first component seeks to increase service delivery readiness at frontline (i.e., level 1-4) health facilities (PHC facilities) and improve access to services at the community level through input financing of equipment, supplies, infrastructure upgrades, training and TA; The second component seeks to incentivize key health systems results prioritized by GoPNG by linking Project financing to the achievement of specified performance targets; The third component will support Project management and oversight; and the fourth component provides a mechanism to reallocate Project financing to support an emergency response, if needed. Component 1: Increase Service Delivery Readiness and Community-based Service Delivery (US$12.4 million equivalent) 2. Component 1 seeks to increase readiness to deliver Frontline Health Services as well as to trial and scale up community-based innovations to generate demand for and improve access to facility and outreach-based health services. Frontline Health Services are defined as those delivered at PHC facilities, i.e., health facilities classified as levels 1 to 4 in accordance with the National Health Standards (or other equivalent classification acceptable to the World Bank), and services provided through outreach from these facilities. Component 1 will finance the purchase of equipment and supplies, training, technical assistance (TA) and limited infrastructure upgrades. 3. This Component comprises four sub-components. Sub-components 1.1, 1.2 and 1.3 will be focused on four Selected Provinces. The selection process for the four Selected Provinces to implement Sub-components 1.1, 1.2 and 1.3 consists of 3 main steps, as further detailed in the POM. The first step is the application of pre-qualification criteria to determine eligible provinces. The selection criteria to identify eligible provinces are: (a) The presence of PHA established prior to March 2019; (b) Health outcomes59, as measured by the SPAR reporting; (c) Level of PFM capacity; (d) Regional representation; (e) Presence of DPs in Provinces; and (f) Convergence with the World Bank-financed Agriculture Projects. With reference to criteria ‘b’ and ‘c’ the objective is to include mid-level performers. With reference to criterion ‘e’, Provinces that receive high levels of DP support will not be included. During the second stage of the selection process, the NDOH will invite PHAs in the Provinces that meet all pre-qualification criteria to provide an Expression of Interest. In the third and final step, the NDOH will review the Expressions of Interest and select Selected Provinces based on the quality of these submissions. This process will be conducted twice during the life of the Project: the first time will be for the selection of Early Adopter Provinces. It is expected that the two Early Adopter Provinces will be identified and selected prior to the effective date of the financing agreement (but in any case, not later than four months after the effective date). The second time will be for the selection of Expansion Provinces and this will be completed prior to Project expansion (planned for June 2022). 4. Implementation of province-specific activities under Sub-components 1.1, 1.2 and 1.3 will begin in the Early Adopter Provinces and potentially expanded to an additional two Expansion Provinces assuming adequate implementation progress. Geographic expansion will be considered after a review of implementation progress and is proposed in Year 3. However, expansion may be considered sooner if the Project implementation is deemed strong enough. Project disbursement levels will be one of the criteria used to ascertain readiness for geographic expansion. 5. Sub-component 1.1: Strengthening readiness to deliver services at the Frontline Health Facilities and through outreach (US$5.0 million equivalent). This sub-component seeks to increase service delivery readiness at Frontline 59IMPACT Health targets mid-performing provinces. These exclude the two provinces placed at the top and the 2 provinces placed at the bottom of the SPAR ranking. Page 74 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Health Facilities (i.e., facilities classified as levels 1, 2, 3 and 4 in accordance with the National Health Service Standards or other equivalent classification acceptable to the World Bank and described in the POM) in Selected Provinces. It is proposed that this sub-component will finance inputs to strengthen service delivery readiness. This may include: (i) carrying out training to build health workers’ skills and improve the quality of essential health services (like family planning and ANC); (ii) improving communications and information technology; (iii) providing equipment to ensure the availability of services at frontlines facilities (e.g. fetal stethoscopes and delivery kits), supplies and ambulances to ensure availability of health services; (iv) upgrading health facilities to meet to national standards (i.e., water and electricity, provision of health care waste management equipment/supplies - no new facilities will be constructed); and (v) increasing capacity to screen for and deliver counseling and other support services to address gender-based violence, including by taking advantage of ANC and other points of contact that women have with the health system. Finally, Sub-component 1.1 activities will also seek to increase capacity to screen for and deliver counseling and other support services to address gender-based violence by taking advantage of ANC and other points of contact that women have with the health system. 6. The investments proposed will be complementary and oriented to filling the gaps that exist after considering investments financed through DP support and through GoPNG. Investments in health facility infrastructure and equipment will prioritize facilities based on ease of physical access and transport links, and the presence of a minimal complement of skilled staff (i.e., facilities that have the potential to be service delivery hubs). The National Health Service Standards, NDOH protocols and an assessment of gaps in the capacity to deliver tracer essential health services, such as Provincial Service Delivery Plans in Selected Provinces, will guide investments. In keeping with the NDOH’s focus on ‘back to basics’ in the NHP, investments will aim to support the delivery of a package of essential RMNCH-N services to adequate levels of quality. This will include a focus on investments to close the gender gap in health endowments and improve readiness to deliver the following services: ANC, institutional deliveries, immunizations, family planning, nutrition-related services and TB detection and treatment. 7. Sub-component 1.2: Innovations in community-based service delivery (US$2.0 million equivalent). The objective of this sub-component is to trial and subsequently scale-up digital innovations to improve access to and use of Frontline Health Services. This sub-component will finance: (i) contracts with non-state service providers/non-governmental organizations to implement strategies to improve access to services at the community level particularly digital innovations to supervise and support Community Health Workers and volunteers in remote rural communities and citizen engagement and accountability for service delivery; and (ii) an evaluation of proof-of-concept for implementation. Investments in community-based service delivery (particularly those in community health workers and volunteers) are expected to contribute to increases in the uptake of health services. These efforts will particularly target pregnant women in order to reduce the number of preventable deaths among women driven by the low coverage and utilization of RMNCH services. Each of the two Early Adopter Provinces will implement one innovation. At the end of three years of implementation, these innovations will be evaluated to inform decisions on scaling up implementation to at least one district in each of the four Selected Provinces for this component. Activities under this sub-component support the implementation of the Healthy Islands Concept, a GoPNG priority. 8. Sub-component 1.3: Strengthening readiness at Provincial Health Authorities (PHAs) (US$3.25 million equivalent): The objective of this sub-component is to build the capacity of PHAs in Selected Provinces on PFM, service planning, supportive supervision, performance management, monitoring and oversight and other relevant areas to ensure good quality health service delivery. This sub-component will finance inputs to strengthen the functioning of PHAs. These may include training, TA, purchase of equipment to support performance monitoring and oversight, including tablets to support data collection and skills building during supervision, communications and information technology equipment and vehicles, as well as operating costs for supportive supervision and maintenance for vehicles procured. Supervision tools will be designed to cover key areas that affect the quality of RMNCH services such as the availability of critical inputs and the level of competency of health workers to deliver such services. Support provided Page 75 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) through this component will complement that provided under the PNG PASA, assuming there is geographic overlap in support. Support provided will also complement the ADB-financed training to PHA Board leadership by delivering continuous assistance and mentoring. 9. In terms of PFM, PHAs play a critical role in the management of finances at the sub-national level and they are thus expected to be prioritized in the roll-out of the Integrated Financial Management System (IFMS). A PHA Manual is being developed to introduce standardized financial reporting requirements, as well as to establish a clear role delineation for PFM-related functions between NDOH and PHAs. The ADB is supporting NDOH in the development of the PHA Manual, and this will also serve as a basis for the upcoming PFM training60 to the PHA Boards. IMPACT Health will complement this training by delivering on-the-job training to the PHA Board and other relevant stakeholders at the subnational level. The training will include support to strengthen routine financial reporting, to build capacity to promote compliance with the PFM Act. Cross-support and peer learning between teams in the Selected Provinces will promote the dissemination of good practices in PFM and the establishment of a network of practitioners. 10. Since 2014, health authorities at the provincial level have developed Provincial Health Service Development Plans. These plans take stock of the existing resources (financial, physical and human) available at the provincial level, and identify gaps based on the National Health Service Standards. Technical assistance to the PHA in the up to four Selected Provinces will be delivered under this sub-component to assist them in the development of prioritized 3-year action plans to meet the National Health Service Standards based on the Provincial Health Service Development Plans. Furthermore, Sub-component 1.3 will provide TA to design effective outreach and supportive supervision strategies based on the information provided by Integrated Facility Supervision Checklists. 11. Sub-component 1.4: National oversight (US$2.15 million equivalent). The objective of this sub-component is to support national, primarily NDOH, oversight of: (a) PHA reforms and (b) service delivery results of Frontline Health Facilities in Selected Provinces. This sub-component will finance inputs including: (i) appointing an independent verification agent for Component 2; (ii) providing technical support to PHAs to improve the delivery of Frontline Health Services; (iii) finalizing a policy and regulatory framework for the PHAs reforms; and (iv) communicating and information sharing Project information with PHAs and other key stakeholders. Inputs may also include purchase of equipment to support performance monitoring and oversight, including independent verification costs, operating costs, training and TA. Financing for independent verification is included in sub-component 1.4 as it is also a mechanism to strengthen routine data collection systems essential for NDOH’s oversight of the health sector. 12. Additional support for improved quality and monitoring of services will be available under the PHCPI to be financed outside the Project. PHCPI is a partnership between the World Bank Group, the WHO and Bill and Melinda Gates Foundation in collaboration with Results for Development and Ariadne Labs, to promote quality PHC for all, with a focus on low and middle-income countries. PHCPI aims to transform the global state of PHC, starting with better measurement, by working with policymakers, donors, advocates and DPs around the world to ensure that the benefits of strong PHC reach all people and all communities. In 2018, PHCPI partnered with several “Trailblazer” country governments (which includes PNG) to develop and launch the first set of Vital Signs Profile; PNG is in the process of preparing the country’s Vital Signs Profile. TA from PHCPI will support the updating of the Government’s systematic assessment of PHC performance every two years, with the results to be made publicly available. PHCPI’s support will also seek to help NDOH strengthen pathways to improve PHC performance at national level as well as provincial level. The Vital Signs Profile will provide a snapshot of the country’s PHC system, identify where systems are strong and where they have challenges, where are the areas for improvement, and to track and trend improvements over time. The information in the Vital Signs Profile will be used to identify priorities for improvement and make the case for additional investment 60The curriculum and the delivery modality for this training has not been developed yet. It is expected to be delivered either in Port Moresby or in regional hubs, but no on-the-job training support is planned. Page 76 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) in PHC; advocates and citizens can use this data to track changes over time and hold leaders accountable. Component 2: Improve frontline service delivery performance (Proposed allocation US$14.6 million equivalent). 13. Component 2 aims to support a program of activities designed to strengthen health systems at the national and provincial levels in order to improve the delivery of Frontlines Health Services in Project-supported Provinces. Financing for this component will be provided based on results tracked by Disbursement Linked Indicators (DLIs). Financing under this component will be disbursed against evidence of achievement of DLI targets and documentation that the expenditures, identified in Eligible Expenditure Programs (EEP), to achieve DLI results have been incurred as further detailed in the DLI Operational Manual annexed to the Project Operational Manual (POM). The DLIs for IMPACT Health include a set of tracer indicators of health systems strengthening actions as well as their end results, i.e., services delivered and quality of care. The DLIs selected reflect the priorities identified in the NHP (2011-2020, as well as emerging priorities in the next Plan), National Health Service Standards and MTDP III. The results-linked financing provided through this component will seek to leverage investments to increase capacity to achieve improvements in frontline service delivery made under Component 1 as well as by GoPNG and by other DPs therefore improving value-for-money delivered from public spending on health more broadly. 14. The DLIs target the following strategic bottlenecks to strengthening frontline service delivery: (i) Delayed flow of operational funding to PHAs through DLIs that could be achieved by effectiveness, and by aligning DLI disbursements to the budget cycle such that disbursements are at the start of the fiscal year; (ii) Weak sector governance due to fragmented and limited accountability for results; (iii) Inadequate supervision of service delivery. Supervision is not adequately used as a mechanism to support improvements in service delivery, including as a training and accountability tool; (iv) Limited and declining outreach. Outreach is an important means of expanding access to services in a country with difficult terrain and dispersed populations. 15. In so doing, it is expected that the DLIs can incentivize improvements in service utilization and quality of care. 16. Three types of health systems strengthening DLIs are proposed: (i) National DLIs (N-DLIs) which reward the achievement of results measured at the national level; (ii) Provincial DLIs (P-DLIs) which reward the achievement of results measured at the provincial level but are restricted to the four Selected Provinces selected to receive support under Sub-components 1.1, 1.2 and 1.3; and (iii) Competitive DLIs (C-DLIs) which reward the achievement of results measured at the provincial level and are open to all Provinces with an established PHA and which indicate interest in being considered for this component. Funding under Competitive DLIs will be awarded to the two highest ranked improvers for each year. If more than two Eligible Provinces are ranked in the top two, the associated DLI funds will be split equally amongst these Provinces as further detailed in the DLI Operational Manual. Since these DLIs relate to improvements over the Province’s baseline, it is anticipated that it may be easier for PHA Provinces with poorer indicators to achieve them, hence improving equity between Provinces. Following the disbursement of DLI funds to NDOH upon the achievement of P-DLI and/or C-DLI targets, NDOH will accordingly allocate and transfer funds out of its own budget (PHA Performance Funds) to the relevant Provinces for the achievement of P-DLIs and/or C-DLIs, in accordance with the details set out in the DLI Operational Manual. Unused DLI funds remaining or expected to be unused at the end of Year 5 will be reallocated to Component 1. 17. DLI design seeks to improve flow of financing to the frontlines, and to align these flows with the GoPNG budget process. N-DLI 1 and P-DLI 1 may be achieved early on in year 1 (which begins in December 1, 2019) given that their achievement requires effort, but not substantial resources. These DLIs may allow financing to flow at the start of the Project. Annual reporting of DLI results is proposed for the July to June period from Year 2 onwards, and for the period Page 77 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) from December 1, 2019 to June 30, 2021 period in the first year of implementation. This will facilitate disbursement of DLI funds after verification by January in the subsequent calendar year ensuring the availability of funding at the start of the fiscal year in Year 2 onwards. No DLI targets are proposed in Year 6. While the annual reporting of DLIs is envisaged, the NDOH will also have the option of reporting semi-annually on a number of DLIs. To improve flow of funds to the frontlines, N-DLI 3 seeks to ensure that PHA Performance Funds, to be allocated to PHAs that achieve DLI results, are appropriated into PHAs’ budgets and transferred in a timely manner in concordance with the criteria outlined in the POM and MoU between NDOH and PHAs for Component 2. 18. DLIs provide flexible financing to address key bottlenecks to improving service delivery at the frontlines. NDOH intends to use DLI funds, once disbursed, to address identified priorities to improve service delivery and achieve future DLI results, and these priorities may include: upgrades to infrastructure, equipment, fuel, training or other needs. The use of the DLI funds will be identified by NDOH in consultation with DNPM to ensure alignment with MTDP III priorities. NDOH envisages that 50 percent of DLI funds may be used for infrastructure and equipment upgrades to improve service delivery, and reporting on the utilization of DLI funds to ascertain the extent to which their use is in line with priorities. Table 1: Overview of DLI allocations (US$ equivalent) Year 1 Year 2 Year 3 Year 4 Year 5 Total (US$) N-DLIs 1,200,000 600,000 1,100,000 600,000 600,000 4,100,000 P-DLIs 300,000 900,000 1,800,000 1,800,000 1,800,000 6,600,000 C-DLIs - - 1,300,000 1,300,000 1,300,000 3,900,000 Total 1,500,000 1,500,000 4,200,000 3,700,000 3,700,000 14,600,000 Year 1 Year 2 Year 3 Year 4 Year 5 Total (US$) P-DLI per 150,000 450,000 450,000 450,000 450,000 1,950,000 province C-DLI 1 top 2 - - 200,000 200,000 200,000 600,000 performers C-DLI 2 top 2 - - 200,000 200,000 200,000 600,000 performers C-DLI 3 top 2 - - 250,000 250,000 250,000 750,000 performers Component 3: Project Management (US$3 million equivalent) 19. Financing under Component 3 will support technical and operational assistance to the Project Coordination Unit (PCU) on Project management and implementation. While the PCU will include existing staff from NDOH, TA is expected to be required for a number of posts, such as Project Coordinator, procurement, financial management, safeguards (depending on the Project specific requirements), monitoring and evaluation, communications, and administrative assistant. The contracting for all but the administrative assistant is expected to be through international advertisement. The option of sharing consultants contracted/to be contracted under existing World Bank support to the sector in the area of procurement and financial management will be explored, as some support to some on-going projects is only Page 78 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) needed on a part-time basis; if that is not practicable then consultants will be contracted to provide support in those areas. This component will also finance the purchase of equipment (computers, desks and chairs), and office supplies, as well as costs associated with communications (internet connection, reasonable phone costs) for the consultants to be contracted, along with a vehicle for use by the PCU; operating costs of the NDOH which are necessitated through Project activities will be financed as well. It is expected that during the initial start-up of activities at the provincial level, TA may need to be provided to the PHAs as they develop the capacity to manage and support activities being carried out under the MOU at that level. Supervision costs by NDOH of the activities being implemented by the Selected Provinces will be financed under this component. Costs associated with semi-annual reviews, including attendance by relevant Provincial staff, will be supported as well. Component 4: Contingent Emergency Response Component (US$0 million) 20. A component with a provisional allocation of zero US dollars equivalent is included under this Project that will allow for rapid reallocation of Credit proceeds in the event of an eligible crisis or emergency under streamlined procurement and disbursement procedures. In the event of an emergency, financial support could be mobilized by reallocation of funds from other components and/or application for additional financing to support expenditures on a positive list of goods and/or specific works and services required for emergency recovery. In the case of such reallocation, the relevant components’ activities would be reviewed and revised as necessary. Requirements for withdrawals under this component include: (a) PNG has determined that an eligible crisis or emergency has occurred, requested the Bank to include the activities in Component 4 in order to respond to the eligible crisis or emergency, and the Bank has agreed with PNG’s determination, accepted the request and notified PNG (b) preparation and disclosure of all safeguards instruments required for activities under the components, if any, and PNG has implemented any actions which are required to be taken under said instruments; (c) PNG has ensured that the entities in charge of coordinating and implementing Component 4 have adequate staff and resources, in accordance with the CERC OM, for the purposes of the activities; and (d) preparation and adoption of the CERC OM, or the provisions of the CERC OM remain up to date, as acceptable to the Bank. The preparation of a CERC OM is supported under the PPG. Disbursements under this component will be made according to the process described in Annex 2. Support to gender 21. The Project will contribute to closing gaps in women’s endowments in health outlined in the World Bank Group Gender Strategy and the EAP RGAP, with a focus on maternal mortality and women’s access to health services. In PNG, gender inequality is a significant development challenge; as a result, women have substantially poorer access to health care services61. Further, gender inequality is evidenced by the low availability and the poor quality of pregnancy- and birth-related health services. Coverage of ANC, an important opportunity to identify high-risk pregnancies, is slightly above 50 percent, and in some provinces like Jiwaka, Southern Highlands and Central province, coverage is below 40 percent. According to the preliminary results of the DHS 2016-2018, only 47.2 percent of rural women who had a live birth in the 5 years preceding the survey received at least four ANC check-ups, while the coverage among women in urban areas was much higher (62.9 percent). Similar trends are observed for institutional delivery (51.1 percent among rural women and 85.4 among women in urban areas) and postnatal check-ups during the first 2 days after birth (42.1 percent for women in rural areas and 72.2 percent among women in urban areas). The ability of health centers and hospitals to provide both outpatient and inpatient services has shown a steady decline, while a workforce with insufficient staff, including a lack of trained midwives and Community Health Workers, further constrains provision of 61 Country Partnership Strategy for the Independent State of Papua New Guinea for the period FY2013-2016 (2012) Page 79 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) adequate care. A recent study has shown that skills to deliver maternal and child services, including antenatal care, are significantly low62. In rural areas, health services are provided mostly by male Community Health Workers (out of 3,006 Community Health Workers, 1,620 are male63) and this can also hinder the delivery of quality health services that are specific to women’s health. Poor health services place women’s lives at risk in childbirth and reduce the chances of their children surviving infancy and early childhood64. 22. Women are the only users of maternal and child health care facilities, but they have the greatest difficulty in gaining access to them. Very often, in case of the closure of local health facilities, women (usually with their children) have to travel further, incurring greater costs for transport, risks to their security, and opportunity costs of time away from home where women bear the heavy daily burden of childcare, food production and other household chores. Access to services for rural women is further restricted by the low number of outreach clinics (from rural health centers) to remote villages for immunization, ANC, nutrition monitoring and family planning. The low availability, quality, and utilization of essential health services is a key driver of poor health outcomes for women. The Project will finance activities to overcome supply- and demand-side barriers to accessing reproductive, maternal, and child health interventions that have demonstrated effectiveness in improving these outcomes. 23. In line with the recommendations of the Maternal Health and Child Task Force, the Project will support investments in the improvement of frontline facilities’ infrastructure and amenities, basic equipment, closing gaps in health workers’ RMNCH-N skills, and service delivery. The Project will also support community outreach activities, aimed, among other, at reducing cultural barriers to use/generate demand for health services. In particular, the Project will support bridging the access gap for ANC and promoting RMNCH-N services, given that women are often reluctant to seek care from male health workers. These activities include: purchasing equipment needed to deliver ANC, training staff in maternal and child skills to improve the quality of the ANC services delivered, improving health service delivery planning to promote higher coverage of ANC through outreach, and health promotion at the community level to increase the demand for ANC services. In addition, this is expected to improve access to services such as TB treatment where gender disparities exist. 24. The Project will measure its ability to close the gaps in these outcomes by monitoring the increase, in the Project- supported provinces, of the number of ANC visits; the number of PHC facilities that meet quality standards for ANC, institutional deliveries and family planning; the number of trained health workers on RMNCH-N skills; the number of immunized children disaggregated by gender; and the number of DSTB patients on treatment who have been cured disaggregated by gender. 25. Component 1 activities will also build in counseling and other support to address gender-based violence during ANC and other points of contact with the health system. Health planning needs, particularly for services delivered through outreach, will be based on gender-disaggregated data. Finally, the Project’s support for the use of routine reporting data, specifically e-NHIS-2 data, will improve gender disaggregated monitoring of indicators at a sectoral level. Performance indicators will be disaggregated, where relevant, in order to track inequities. 62 Hou, Xiaohui; Khan, M. Mahmud; Pulford, Justin; Saweri, Olga; Demir, Ibrahim; Haider, Rifat; Ahmed, Shakil. 2018. Service delivery by health facilities in Papua New Guinea: report based on a countrywide health facility survey (English) . Washington, D.C.: World Bank Group. http://documents.worldbank.org/curated/en/269931525699558992/Service-delivery-by-health-facilities-in-Papua-New-Guinea- report-based-on-a-countrywide-health-facility-survey 63 Morris, Ian P.; Somanathan, Aparnaa. 2012. Papua New Guinea (PNG) health workforce crisis: a call to action (English). Washington D.C.: The Worldbank. http://documents.worldbank.org/curated/en/216511468332461651/Papua-New-Guinea-PNG-health-workforce- crisis-a-call-to-action 64 World Bank. 2012. Papua New Guinea - Country gender assessment for the period 2011-2012 (English). Washington DC: World Bank. http://documents.worldbank.org/curated/en/491231468058779689/Papua-New-Guinea-Country-gender-assessment-for-the-period- 2011-2012 Page 80 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Page 81 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) ANNEX 2: Implementation Arrangements and Support Plan COUNTRY: Papua New Guinea Improving Access to and Value from Health Services in PNG: Financing the Frontlines Institutional and Implementation Arrangements 1. The proposed Project will support the implementation of the Government’s NHP (2011-2020) which has the goal of strengthening PHC for all and improving service delivery for the rural majority and the urban disadvantaged, and the MTDP III which includes a focus on reducing stunting. The NHP 2021-2030 is under preparation. Based on information provided by the NDOH, the next NHP will continue to have a focus on Frontline Health Services and strengthening the PHA reform. The Project’s aim is to complement support being provided by the ADB as well as other DPs. 2. The NDOH will be the implementing agency for IMPACT Health, as it plays a critical role in the oversight of PNG’s health system. The NDOH is responsible for the design and implementation of national policies and programs, as well as the consolidation of the national budget for all health agencies including PHAs. PHAs are legally accountable to the Minister of Health and HIV/AIDS65 and the establishment and operationalization of PHAs is a national reform championed by the NDOH. The HNP services that are the focus of the Project are also delivered through national programs that are the responsibility of the NDOH. 3. The NDOH is in the process of a reorganization. The description below is based on the existing configuration. The NDOH Secretary for Health will be the Project Director for IMPACT Health, with day-to-day running of the Project delegated to the NDOH Deputy Secretary, National Health Policy and Corporate Services (NHPCS). The Deputy Secretary will be assisted by the PCU, which will be mapped to a health sector coordination secretariat once it is set up. The PCU will be responsible for carrying out day-to-day management and implementation of the Project. It will comprise staff within NDOH, as well as a Project Coordinator who will be contracted over the Project period, and other consultants providing support to fiduciary aspects (procurement and financial management) and safeguards, coordination, monitoring and evaluation, and communication of Project activities. PCU requirements will be reviewed during implementation and the need for any additional capacity will be explored during the ongoing preparation. Given the existence of an active World Bank-financed Project in the health sector, the Emergency TB Project, consultants will share their time between the Emergency TB Project and IMPACT Health PCUs in cases where full-time support may not be needed (e.g., in the case of the procurement specialist). 65 The PHA Act (2007) and the PHA Amendment Act (2013). Page 82 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Figure 1: Organogram of the NDOH 4. Individual consultants in the PCU will be required to support Project implementation and to build the capacity of existing NDOH staff in key Project implementation areas such as (a) Project management; (b) procurement; (c) financial management; (d) safeguards; and (e) information dissemination. By not later than six months after effective date of the Financing Agreement, the following positions within the PCU will be recruited or appointed: (a) a Project coordinator; (b) a procurement specialist; (c) a financial management specialist; (d) a monitoring and evaluation specialist; and (e) an administrative assistant, each with terms of reference, qualifications and experience satisfactory to the Bank. All contracted individuals will be assigned to support one or more existing NDOH staff who will be nominated by the NDOH Deputy Secretary on NHPCS. Regardless of any structural changes within the NDOH, the Project will require the support from the various technical areas, such as PHC, finance, management, policy, planning, performance monitoring and research, disease control and surveillance, public health, and health promotion. 5. The PCU will be responsible to support the NDOH for the following tasks: a. Preparation, approval and adoption of the POM and CERC OM; b. Overall administration of the Project, including the preparation of Annual Work Plans and Budgets; c. Overall implementation of Project activities, with the support of NDOH technical departments, and those PHAs participating in the Project; d. Overall administration of financial management, procurement, environmental and social safeguards management, and communication on all Project activities; Page 83 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) e. Overall monitoring, evaluation and reporting of Project activities and DLIs, including submission of findings by the IVA against which funds will be disbursed against DLIs; f. Organization of quarterly reviews, ensuring that World Bank implementation support reviews are timed to match at least two of these quarterly reviews per year; and g. Preparation of semi-annual progress reports covering all aspects of implementation such as Project activities and the achievement of DLIs, as well as the fiduciary aspects and disbursements. 6. To mitigate delays with slow implementation of IMPACT Health, the NDOH will aim to set up the PCU prior to Project effectiveness and initiate key procurements. This is expected to improve readiness to implement at effectiveness. Australia’s DFAT has provided financing for a PPG to the NDOH for this purpose. 7. A phased expansion of Project implementation is proposed. Implementation of province-specific activities under Sub-components 1.1, 1.2 and 1.3 will begin in two Early Adopter Provinces and potentially expanded to up to two additional Expansion Provinces assuming adequate implementation progress. Readiness filters will be used to select Provinces for these sub-components, including the following criteria: (a) The presence of a PHA established prior to March 2019; (b) Health outcomes, as measured by the SPAR reporting; (c) Level of PFM capacity; (d) Regional representation; and (e) Presence of DPs in Provinces. It is expected that the Early Adopter Provinces will be identified and selected prior to the effective date of the financing agreement (but in any case, not later than four months after such effective date) , and the Expansion Provinces will be selected prior to scaling up. This geographic scale-up to up to two Expansion Provinces will be considered after a review of implementation progress and is proposed for Year 3. However, the geographic scale- up may be considered sooner if the Project implementation is deemed strong enough. Project disbursement levels will be one of the criteria used to ascertain readiness. 8. Implementation arrangements for DLIs. The NDOH will be responsible for implementing Component 2 with the support of participating PHAs. The POM will include detailed operational guidelines on implementation. To support implementation of this component, the NDOH will enter into a MoU with each PHA in the four Selected Provinces for Provincial DLIs (P-DLIs). An MoU between the NDOH and PHA will also be required for a Province to be eligible for the Competitive DLI (C-DLI). The MoU will lay out the roles and responsibilities of the NDOH and PHAs in implementing Component 2 and require compliance with the POM. In addition, the MoU will specify the formula for the distribution of PHA Performance Funds to PHAs that meet P-DLI or C-DLI targets. PHA Performance Funds are intended to improve the flow of GoPNG funding to the frontlines. 9. Technical support for the implementation of DLIs. Technical support will be provided by different levels and entities within the PNG Health System. Departments within the NDOH, notably Strategic Policy and Planning Division, Public Health Division and Corporate Services Division, will support the achievement of DLI results, including through: (i) support to establishing, operationalizing and building the capacity of PHAs and facilitating PHA functioning; (ii) direct support to service delivery through the national service delivery programs for RMNCH-N and TB; and (iii) oversight and management of the health system. PHAs, in turn, will manage delivery of Frontline Health Services. To provide additional technical support to create an enabling environment to achieve DLIs, Component 1 of the Project includes TA and training focused on readiness to achieve results, but which is distinct from the effort and expenditures involved in achieving the DLI results. Illustrative examples of TA/ training, including PFM capacity building for PHA staff or training to build clinical skills for health personnel. Technical support may also be available through other DPs, and the NDOH has established a health sector coordination mechanism to coordinate support among the DPs. 10. Disbursement of DLI funds. Component 2 funds will be disbursed on a reimbursement basis against expenditures incurred and financed by NDOH, and evidenced in a Statement of Expenditures documenting the incurrence of EEPs against which withdrawal is requested. The EEP for Component 2 comprises of selected salaries and allowances lines in Page 84 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) the NDOH budget for divisions that contribute to the achievement of the IMPACT Health PDO, i.e., selected salaries and allowance lines within Department Code 240, Expenditure Code 211. The selected lines include salaries and allowances for the following divisions: the Office of the Secretary, staff under the NHPCS wing (both the Corporate Services Division responsible for financial management functions, and the Strategic Policy and Planning Division responsible for designing and implementing policies, and for monitoring the sector’s performance); and the Public Health and the Population and Family Health teams that manage programs such as maternal health, nutrition, immunization, and disease control and surveillance. Further details of the EEP will be set forth in the DLI Operational Manual. Table 1: Budget lines for DLI Eligible Expenditure Program Department Expenditu Activity Code Activity Description Description Code -re code 240 10469 Office of EM Public Health 211 Salaries and allowances 240 10463 Population and family health 211 Salaries and allowances 240 10441 Office of the Secretary 211 Salaries and allowances 240 10490 Performance Monitoring and Research 211 Salaries and allowances 240 12029 Office of the EM Strategic Policy 211 Salaries and allowances 240 12034 Office of the EM Corporate Services 211 Salaries and allowances 240 10485 Human Resource Planning & Management 211 Salaries and allowances Note: EM = Executive Manager 11. As a general rule, a 6-month period is anticipated to complete DLI target reporting, verify results and disburse; in addition, in order to synchronize disbursements with GoPNG’s budget cycle (January-December calendar year) and ensure flow of funds at the start of the calendar year, the assessment period for DLI results will run July-June fiscal year. Year 1 will run from December 1, 2019-June 30, 2021, and two of the DLI targets for Year 1, i.e. N-DLI 1 and P DLI 1, may be achieved early on by April 2020. From Year 2 and onward, the assessment period will be July-June and disbursements will be expected by January of the following year. No DLI targets are proposed for Year 6 of Project implementation to allow for re-allocation of funds if needed prior to the closing date. Furthermore, if necessary, in-year assessments of DLI achievement may be carried out to help with budget constraint and enhance funding predictability for the project. 12. An IVA, to be procured no later than 3 months after effective date of the Financing Agreement, will verify the achievement of DLI results based on the verification protocol that has been outlined in the DLI matrix and detailed in the POM. The target will be considered achieved as reported in cases where there is no difference between results reported and IVA assessment of target achieved. For DLIs with numerical targets there may be differences between the target value as assessed in the results reported and IVA verification of the same since some variables may change with the passage of time (e.g., available stocks of drugs at the facility, a possible item in the Integrated Facility Supervision Checklist) or as a result of the sampling methodology used in the IVA’s verification. For such DLIs, if there is a difference of 10 percent or less between the results reported and the IVA’s assessment of target achieved, the target will be considered to have been achieved as reported by NDOH. Operational guidance on DLIs described in the POM will specify the implications for DLI disbursements in cases where there is a discrepancy of over 10 percent. Supporting documentation for DLI disbursements will include a letter from the Bank to the GoPNG confirming the relevant amount to be disbursed for the DLI in question. 13. The annual, initial reporting on achievement of DLI targets will be the responsibility of the PHAs or NDOH, who will report on the achievements to the Project Director. The Project Director will ask the IVA for their independent Page 85 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) verification as required by the POM; the findings from the IVA will be communicated by the Project Director to the task team leader of the World Bank along with other supporting documentation for DLI disbursements. Report on the achievement of DLI targets, including the findings from the IVA, will be provided to the World Bank within five months of the completion of each year as defined in the Financing Agreement. 14. Flow of funds to PHAs under Component 2. Project disbursements for Component 2 are to the NDOH. As part of the technical design of IMPACT Health, NDOH will allocate PHA Performance Funds to PHAs that achieve DLI targets in order to improve the flow of funds to the frontlines. These funds are to be appropriated into the budget of the relevant PHAs in line with the AWP criteria outlined in the MoU signed with PHAs for Component 2 and operational guidelines in the POM. 15. Retroactive financing and unused DLI funds. Retroactive financing may be considered under the IDA credit to finance payments made against eligible expenditures under Components 1, 2 and 3, between December 1, 2019 and the signature date of the Financing Agreement, for an amount up to 20% of IDA credit or SDR 4,360,000 (US$ 6 million equivalent). It is envisaged that unused DLI funds remaining (or expected to be unused) at the end of Year 5 will be reallocated to support activities under Components 1. Results Monitoring and Reporting 16. Progress toward the PDO will be monitored through reporting on the PDO-level and intermediate-level results indicators. A Results Framework with Project-specific indicators and actionable monitoring arrangements has been developed jointly with the NDOH and other stakeholders. This will be used for monitoring of implementation progress and results of Project implementation. Overall monitoring and coordination of Project activities will be performed by the implementing agency with the support of the PCU. The PCU will have overall responsibility for monitoring and evaluation of the different components/activities in accordance with the indicators included in the Results Framework. The PCU will gather data from the relevant units in the Government and IVA. No later than 45 days after each semester (semi-annually), the PCU will submit semester progress reports to the World Bank, covering all Project activities, including procurement and financial summary reports. The Project will also submit its Annual Work Plan and Budget for the World Bank’s no- objection within two months after the effectiveness date of the Financing Agreement and by June 1st of each subsequent year of implementation. 17. The World Bank will monitor implementation progress during implementation support visits which will provide a detailed analysis of implementation progress toward achieving the PDO and include an evaluation of financial management and a post-review of procurement activities. During the implementation support visits, the World Bank will work with the NDOH, Department of National Planning and Monitoring (DNPM), participating PHAs and other key stakeholders to obtain feedback on progress and consider any adjustments to ongoing activities. 18. By not later than three years after the effective date of the Financing Agreement (or such other date as agreed with the World Bank), NDOH and the World Bank will carry out a midterm review of the Project. NDOH will prepare and furnish to the World Bank, at least one month before the midterm review, a midterm report documenting progress achieved in the implementation of the Project during the period preceding the date of such report, including the monitoring and evaluation activities performed and setting out the measures recommended to ensure the continued efficient implementation of the Project and the achievement of its objectives during the period following such date. It will review this midterm report with the World Bank and thereafter take all measures required to ensure the continued efficient implementation of the Project and the achievement of its objectives. At the end of the Project, the World Bank will prepare an Implementation Completion and Results Report, which will include an assessment of the Project by the Government, to evaluate the Project and draw lessons. Page 86 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) 19. The Project will contribute to strengthening monitoring and evaluation mechanisms in the following ways: (a) Improving implementation of sectoral monitoring tools and use of monitoring data to plan and manage service delivery at the frontlines through the following tools: (i) Development and implementation of an Integrated Facility Supervision Checklist which can enable routine monitoring of facility quality, including staff knowledge, availability and functioning of key facility inputs such as presence of drugs and supplies; (ii) Development and use of National and Provincial Performance Dashboards based on routinely reported data, including that reported through the eNHIS; and (b) Increasing the quality of routinely generated data: To ensure that financing through DLIs is based on credible data, the Project will use an IVA, contracted for the duration of the Project, to verify DLI achievements based on a clearly defined protocol for each DLI, including random checks to sub-samples of health facilities and patient call backs to confirm the quality of data on facility quality reported in Integrated Facility Supervision Checklist and of eNHIS data on utilization. Financial Management 20. A financial management assessment was carried out in accordance with the “Principles Based Financial Management Practice Manual” issued by the Vice President, OPCS on February 04, 2015 and as further elaborated on in the World Bank Guidance “Financial Management in World Bank-Financed Investment Operations” issued by the Director, Operations Risk Management, OPCS on February 24, 2015 . Under the Bank Policy and Bank Directive on Investment Project Financing with respect to projects financed by the World Bank, the borrower and the Project implementing agencies are required to maintain financial management arrangements (including planning and budgeting, accounting, internal controls, funds flow, financial reporting, and auditing systems) acceptable to the Bank to provide reasonable assurance that the proceeds are used for the purposes for which they are granted. These arrangements are deemed acceptable if they are capable of correctly and completely recording all transactions and balances relating to the Project. In addition, such arrangements are acceptable if they can facilitate the preparation of regular, timely and reliable information regarding project resources and expenditures and safeguard the Projects assets; and are subject to auditing arrangements acceptable to the World Bank. The executing agency will be the Department of Treasury, and the implementing agency will be NDOH. The existing financial management arrangements of NDOH appear acceptable to the meet the financial management requirements as stipulated in Bank Policy and Bank Directive on Investment Project Financing. The Project’s overall financial management risk is rated as “High”. 21. Budgeting. All donor funded Projects are to be included in the GoPNG Public Investment Program and National Budget, so as to have aid on plan and on budget. Currently this Project is not in the Public Investment Program 2019-2023. A Project Formulation Document was submitted by NDOH, to DNPM as part of the 2020 budget process, to have the Project included in future Public Investment Programs and National Budgets. The NDOH will be required to send annual budget submissions to the Department of Treasury from 2020 onwards. A budget for the whole Project will need to be prepared, broken down by year, and appropriate levels of detail (e.g., component or category, whichever is deemed most relevant and useful). 22. Counterpart Funding. Under PNG Country Financing Parameters, funding of taxes is allowed, and the Project costings and budget has been prepared inclusive of taxes and IDA financing will be inclusive of taxes. The Credit funding is covering all planned activities under the Project to achieve the development outcomes, results and indicators. World Bank Guidelines on Country Financing Parameters discourages waivers or reduction of duties and taxes of World Bank financed Projects and activities, and this approach is taken by PNG where under PNG laws, when donor funds are financing inclusive of taxes, there are no tax exemptions allowed. As such no tax exemptions will be approved by GoPNG for this Page 87 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Project. As a result, there are no counterpart funding requirements. 23. Funds Flow. Funds will flow from the World Bank to GoPNG via (a) advances; (b) direct payments; (c) reimbursement of GoPNG expenditure; and (d) special commitments, if required (refer to the Disbursements section below for more details on disbursement arrangements). This Project plans to have DLIs. Paragraphs 10-14 and paragraphs 31-33 include more details on funds flows for the DLIs. A minimal ceiling of the Designated Account of PGK 200,000 is recommended as a risk mitigating strategy due to risks identified in various audit reports. 24. Accounting and Maintenance of Accounting Records. All GoPNG funds are bound by the Public Finances Management Act 1995 and the PNG Financial Management Manual. The Government is currently implementing a new IFMS and transitioning departments over from the PGAS. The NDOH transitioned to IFMS in 2018 and will use the new IFMS to record accounting information. The NDOH and GoPNG operate on a cash basis of accounting; accounting records are to be maintained by NDOH and made available to both auditors and the World Bank, as required. 25. Internal Controls including Internal Audit. As indicated above, the NDOH is bound by the Public Finances Management Act and PNG’s Financial Management Manual for its policies and procedures manual. The NDOH has an internal audit division and Audit Committee. The Project should be included in the annual internal audit plan for the NDOH, and in relevant reports to the Audit Committee. Given the identified weaknesses in PNG’s accounting system and controls for personnel management, i.e. payroll controls are weak, agencies are not complying with General Orders, Public Financial Management Act, business processes for Human Resources and payroll management66 and the significant cost over runs in NDOH salaries and allowances i.e. 50% overrun in 201867, adequate oversight of the payroll systems and the expenditures reported will be required. 26. Periodic Financial Reporting. Unaudited interim financial reports of the Project will be prepared on a quarterly basis. The financial reports will include an analysis of actual expenditure for the current period, year to date and for the cumulative to date, plus outstanding commitments, compared against total Project budget. The format will be developed and agreed between the implementing agency and the World Bank prior to the due date for the submission of the first unaudited interim financial reports. These reports will be forwarded to the World Bank within 45 days of the end of each calendar quarter. 27. External Audit. An annual audit of the Project financial statements will be required. The Auditor General’s Office of PNG is mandated to audit all Government funds. The Auditor General requires annual financial statements to be prepared in accordance with International Public Sector Accounting Standards cash basis accounting standards. The audited financial statements, audit report and management letter must be received by the World Bank within 6 months of the end of the fiscal year and shall be made publicly available by the Recipient in a manner acceptable to the World Bank as per the General Conditions of International Development Association Credits and Grants. 28. Financial Management Supervision Plan. Below is the plan for supervision of the financial management aspects of the Project. 66 PEFA Roadmap 2015-2018 67 2018 Final Budget Outcomes Page 88 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) FM activity Frequency Desk reviews Unaudited interim financial reports - review Quarterly Annual audit report - review Annually On site visits Formal supervision Half yearly initially, then Annually based on risk and performance ratings. Monitoring of actions taken on issues highlighted in review of the As needed. interim financial reports and audit reports, auditors’ management letters, and other applicable reviews Transaction reviews (if needed) On an as needed basis, and in the case of any issue arising. 29. Financial Management Action Plan. A summary of the Financial Management Action Plan is shown below. No. Action Date by which action Responsible required 1 Prepare and agree format of unaudited interim financial Prior to the due date NDOH and reports that will be used for quarterly reporting. for the submission of World Bank the first Report. Financial Management Specialist Disbursements (All Components) 30. Disbursement Methods and supporting Documentation Arrangements. The Project could use four disbursement methods: (a) advances; (b) direct payment; (c) reimbursement, and (d) special commitments. Direct payments would be used for the majority of payments due to the risks and issues identified by audit reports on incorrect use of project and donor funds. Reimbursement would only be used if GoPNG funds were used for eligible expenditures under components 1 and 3 of the Project; Bank’s disbursements under Component 2 will be only on reimbursement basis. Special commitments may be needed if goods are purchased from overseas. Disbursements will be against Statements of Expenditure. Required supporting documentation for disbursements will be further outlined in the Disbursement and Financial Information Letter, including a sample of Statement of Expenditure. 31. Disbursements for Component 2. Component 2 funds will be disbursed on a reimbursement basis upon i) achievement of DLI targets and ii) EEPs incurred and financed by NDOH, and the actual disbursements by the Bank in any given assessment period will be the lower of EEPs incurred and not yet reimbursed and combined values of DLI targets achieved and verified. In addition, the preparation, finalization and adoption of POM, in form and substance satisfactory to the World Bank, will be another disbursement condition for Component 2. The signing between NDOH and Selected Provinces of an MoU, in form and substance satisfactory to the World Bank is the target set for N-DLI 1. An MoU to be entered between NDOH and relevant Provinces will be a prerequisite for participating in C-DLIs. Funds allocated for C-DLIs Page 89 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) from Year 3 of implementation onwards may not be disbursed to NDOH unless an MoU has been entered into between the NDOH and relevant Provinces. 32. Designated Account and bank account for Component 2 reimbursements. The Public Finances Management Act and Financial Management Manuals allow for donor sourced funds for projects to be held in separate trust accounts. Note while at present a single central treasury account is not being used for donor projects, should donor projects also be moved to a single central treasury account - likely after transition to the new accounting software (Finance One) - then while there may be one physical bank account, there will be general ledger sub-codes for each implementing agency and project, to effect the segregation of funds. A Designated Account with a very low ceiling of approximately PGK 200,000 will enable the Project to progress while limiting the exposure, as a risk mitigating strategy. Reimbursements for Component 2 will be disbursed to a separate bank account as indicated by the borrower in the Withdrawal Application and in line with guidance in the POM. 33. Eligible Expenditures IDA Credit IDA Credit Percentage of Category Amount of Credit Amount of Credit Expenditures to be Allocated Allocated Financed (expressed in SDR) (US$ equivalent) (inclusive of Taxes) (1) Goods, works, non-consulting services, consulting services, operating costs, and training and 11,200,000 15,400,000 100% workshops, for Components 1 and 3 of the Project (2) EEP for Component 2: Salaries and Allowances 10,600,000 14,600,000 100% * Disbursement Linked Indicators (DLIs). (3) Emergency Expenditures 0 0 100% under Component 4 TOTAL AMOUNT 21,800,000 30,000,000 34. Funding Sources Amount (US$ Share of Source million) Total (%) World Bank – IDA Credit 30.00 100% Total 30.00 100% 35. Disbursement Conditions. In addition to the conditions associated with DLIs, the preparation, finalization and Page 90 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) adoption of the POM will be the disbursement condition for Category 2. For Category 3, CERC, disbursement conditions will include: (a) PNG has determined that an eligible crisis or emergency has occurred, has furnished to the Bank a request to include said activities in Component 4 in order to respond to said eligible crisis or emergency, and the Bank has agreed with such determination, accepted said request and notified PNG thereof; (b) preparation and disclosure of all safeguards instruments required for activities under the components, if any, and PNG has implemented any actions which are required to be taken under said instruments; (c) PNG has ensured that the entities in charge of coordinating and implementing Component 4 have adequate staff and resources, in accordance with the provisions of the CERC OM, for the purposes of said activities; and (d) preparation and adoption of the CERC OM, or the provisions of the CERC OM remain up to date, as acceptable to the Bank. Procurement 36. Institutional arrangements for procurement. The NDOH will be the implementing agency of the Project and will be responsible for ensuring the procurement requirements of all the sub-components are met. 37. Applicable procurement regulation. Procurement for the proposed Project will be carried out in accordance with the World Bank Procurement Regulations for IPF Borrowers (Borrowers Regulations), July 2016, revised November 2017 and August 2018, and the provisions stipulated in the Financing Agreement. For procurement activities which are subject to international competition based on the World Bank’s Procurement Method Thresholds, the Bank’s Standard Procurement Documents shall be used. Procurement risk assessment 38. A procurement risk assessment of the NDOH to implement procurement actions for the Project was carried out and the overall procurement risk rating is “Substantial”. 39. The main procurement-related risks identified are: (a) Corruption and bribery concerns in terms of internal controls within the NDOH and broader context of the country; (b) The Government does not have a functioning administrative system for handling of complaints and resolution of disputes during tendering or for contract management; (c) Few qualified suppliers/contractors in the market—limited competition; (d) Limited capacity of the NDOH staff on procurement and contract management; (e) National Procurement Act 2019 came into effect April 1, 2019 and its impact on implementation of Bank financed activities is currently untested; and (e) Government approval processes are lengthy. 40. The following mitigation measures are proposed: (i) The PCU will be responsible for assisting the NDOH with all aspects of Project implementation, including procurement. Accordingly, the PCU will need to provide dedicated procurement resourcing to ensure that all procurement activities are carried out in accordance with World Bank requirements under the Procurement Regulations for IPF Borrowers. It is anticipated that core PCU members will be procured prior to Project effectiveness through a PPG. (ii) In supporting the NDOH to undertake procurement activities, the PCU will apply, wherever possible and appropriate, the Procurement Implementation Guidance including simplified template documents in “Making Procurement Work for Fragile and Small States in the Pacific under World Bank Investment Project Financing following the Procurement Regulations for IPF Borrowers”, dated in April 2018. (iii) The PCU will apply the procurement procedures detailed in the POM (to be prepared) and will develop detailed checklists to ensure consistent and compliant procurement. Page 91 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) (iv) The PCU will also develop a contract management system to ensure that all contracts under the Project are effectively and efficiently managed; this will include the tracking of key contract milestones and performance indicators as well as capturing all procurement and contract records. (v) Consider, based on Project needs, contracting of United Nations agencies to carry out aspects of the Project, based on their technical capacity in the procurement of works and goods (including but not limited to medical equipment, specialized equipment and consumables) for use in health facilities classified as levels 1 to 4 in accordance with the National Health Standards (or other equivalent classification acceptable to the World Bank) in the four Selected Provinces for Components 1.1-1.3. Where appropriate the procurement of goods is to include requisite parts, warranty, and training. This means the usage of Direct Selection of United Nations Agencies. This is particularly important as the Government procurement systems do not allow for the direct/single-source selection, except under specific and defined circumstanced including the declaration of a health emergency. This approach is the same as was used for the Emergency TB Project (P160947), this Project will also support the delivery of TB services. The use of the United Nations Office for Project Services (UNOPS) was discussed with the Government during preparation of the Project and there was general agreement and support for their continued use under this Project in the first two (2) Selected Provinces (ongoing requirement to be evaluated). 41. Procurement Types. The various types of procurements to be financed by the proposed IDA Credit and indicative cost estimates are noted in the following table and described below. 42. Type of Procurement 43. Cost estimate 44. 1. Works 45. US$2.00 million equivalent 46. 2. Goods 47. US$2.62 million equivalent 48. 3. Consulting Services 49. US$5.29 million equivalent 50. 4. Non-Consulting Services 51. US$1.90 million equivalent 42. Procurement of works. No new construction is anticipated, only minor rehabilitation of existing facilities is envisaged. 43. Procurement of goods. Procurement of goods will include equipment and supplies for health facilities classified as levels 1 to 4 in accordance with the National Health Standards (or other equivalent classification acceptable to the World Bank), vehicles, computers/tablets, office equipment and supplies. 44. Procurement of consulting services (firms and individuals). Procurement of consulting services will be carried out in accordance with the World Bank Procurement Regulation for Investment Project Financing for IPF Borrowers. Activities to be financed include individual consultants to the PCU, TA and training for Provinces, and to evaluate the community- based activities; an IVA will be contracted to verify results for DLIs; NGOs and other non-state entities such as research institutions/churches will be contracted to carry out activities for Sub-component 1.2. 45. Procurement of non-consulting services. This will include hiring service provider(s) (local or international) to deliver non-consulting services to manage activities under Component 1.2 at the community level following a competitive selection process. 46. Frequency of procurement supervision. In addition to the prior review to be carried out by the World Bank, supervision missions will be undertaken at least once per year. One in five procurement packages not subject to World Bank prior review will be examined ex post on an annual basis. Page 92 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) 47. Procurement Plan. A Project Procurement Plan has been prepared covering the planned procurement activities for the first 18 months of Project implementation. The procurement arrangements for the key procurement activities under the Project will be detailed in the Project Procurement Strategy for Development. 48. With respect to procurement, the PCU will be responsible for all aspects of procurement which will be undertaken by the Project. This includes, but is not limited to, updates to the Procurement Plan, preparing the terms of reference and/or specifications with inputs from relevant Departments, and carrying out the procurement in line with the World Bank Procurement Regulations for IPF Borrowers, July 2016, revised November 2017 and August 2018, the approved Procurement Plan, as well any provisions stipulated in the Financing Agreement. The use of the World Bank’s STEP system will be mandatory, and the NDOH has gained experience in its use as implementer of the World Bank supported Emergency TB Project. In addition to the foregoing, the Project is subject to the Government rules and regulations relating to procurement. While hands on expanded implementation support was provided to the on-going Emergency TB Project during start-up, such support is not deemed necessary based on recent experience gained by NDOH. Safeguards 49. Environmental and social specialists at the World Bank will provide regular guidance to the PMU in order to strengthen their capacity to address safeguards-related issues. This support will include monitoring the implementation of the ESMF and providing overall guidance to identify any potential concerns related to the implementation of the Project. Training in HCWM will be required for PHC staff including awareness raising about the potential hazards from HCW, safe waste-handling and disposal procedures, reporting of exposures and injuries, preventing infection following an exposure with post-exposure prophylaxis, and the use of personal protective equipment (PPE). It will also be necessary to provide guidance on facility establishment and operational procedures for waste disposal, which in most cases will be via burial. The safe burial of hazardous health-care waste in minimal circumstances depends critically on staff following sensible operational practices. Strategy and Approach for Implementation Support 50. The World Bank will provide formal implementation support on a semi-annual basis. The Semi-annual Progress Reports prepared by the PCU will form the basis of such reviews, and be undertaken, to the greatest extent possible, in coordination and collaboration with other DPs supporting the sector. The World Bank team will include the Task Team Leader, health, economics and other specialist support on an as-needed basis, operational support along with financial management, procurement and safeguards support provided regionally. Expertise on DLIs will be sought, along with specialists from the Health, Nutrition, and Population Global Practice if progress reports highlight/indicate any need on specific topics. 51. Training and knowledge sharing will be provided by the World Bank from its own resources, and additional resources will be sought for relevant support as and when the need arises. The team will also draw upon the expertise in- country from various United Nations technical agencies such as WHO and UNICEF; the experience of other DPs will also be sought to better inform the implementation of activities. The possibility of leveraging support from these sources and to coordinate and collaborate to gain efficiencies will continue to be explored during implementation. 52. The implementation support plan is based on the Project's risk profile, the lessons learned from other projects with DLIs, as well as a recently conducted Portfolio Review conducted in PNG. This Project will be the third WB support to the sector since 1993 (the second being the Emergency TB Project which became effective in 2017). The approach is to provide implementation support that includes continued consultation with other partners, at a timing that fits in with regularly to-be-scheduled reviews of the Project to encourage complementarity. As previously indicated, given the experience gained by the Emergency TB Project in World Bank processes, hands on expanded implementation support during start-up is not viewed as necessary. Page 93 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) 53. The PCU, in consultation with the World Bank will determine the appropriate timing of semiannual reviews, taking into consideration availability of participants. Every effort will be made to ensure that the reviews by the World Bank coincide with existing mechanisms to evaluate the latest in-country situation and information is shared on lessons, successes, emerging needs, and other information relevant to the success of the World Bank support. Prior to the implementation support reviews, the PCU will have prepared, and shared with the World Bank, the semi-annual review covering the previous 6 months, which will inform the review, along with any other topics relevant to implementation of the Project. Field visits will be undertaken to participating Provinces to listen to the experiences arising from the activities being undertaken in the Selected Provinces. The World Bank implementation reviews will also cover non-technical aspects of the support, including (a) financial management; (b) procurement; (c) implementation arrangements; and (d) safeguards. Timing of any additional non-technical reviews will also be discussed and agreed upon with the NDOH/PCU. It is understood that, to the greatest extent possible, the World Bank team will accommodate any written request for ‘as - needed’ support for the Project, including fiduciary aspects. 54. Each implementation review mission will produce an aide memoire that will be discussed at a wrap-up meeting to be chaired by the DNPM. Such an aide memoire is envisaged to provide an overall view of the current situation and Project implementation, with findings from the World Bank and any other partners who wish to include their support- specific sections, attached as annexes to the main text. Representatives from DPs, implementers, as well as relevant government departments will be invited to attend the wrap-up meetings. Any adjustment requiring more frequent reviews will be discussed, agreed upon, and documented in the aide memoire. If reviews relevant to the Project are being conducted by DPs or other technical experts, the World Bank will be informed and afforded an opportunity to participate in such consultations/discussions. 55. The implementation support plan will be reviewed annually to ensure that it continues to meet the implementation support needs of the Project. At either the halfway point of the Project period, or when the funds are 50 percent disbursed, a ‘Mid-Term Review will be undertaken with a view to make any changes to the support, including any requirements necessitating restructuring which may be necessary based on the implementation experience and/or possible additional financing from other sources. The World Bank task team will work with the PCU and designated officials to clarify the requirements necessary to effect any changes. It is understood that any changes to the Project that require amendments to the Financing Agreement will require a formal request from the Government’s signatory to the legal agreement. 6 months prior to the closing date of the Project, the Government will commence preparation of its Implementation Completion and Results Report. The author of the Report from the World Bank will participate in the final implementation review and gather the necessary information to prepare the Implementation Completion and Results Report. Implementation Support Plan 56. It is anticipated that considerable implementation support will be needed, particularly in the first year of implementation since DLIs are an innovative approach and the NDOH is still relatively new to World Bank lending. The following tables provide a view of the anticipated needs during the implementation period. Table 2: Main Focus and Estimated Cost for Implementation Support RESOURCE TIME FOCUS SKILLS NEEDED ESTIMATE 1st 12 months • Public Health • Public health • DLI • Health economics/ financing US$300,000 • Monitoring and • Operations Evaluation • Social sector Page 94 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) • Operations • Financial Management • Safeguards • Procurement • Financial management • Procurement 12-72 months • Public Health • Public health • DLI • Health economics/ financing • Monitoring and • Operations Evaluation • Social sector • Operations • Financial Management US$300,000 • Safeguards • Procurement • Financial Management • Procurement Table 3: Skills Mix Required (6 years) Number of Staff Number of Skills Needed Comments Weeks Trips Task Team Leader 48 12 Assume 8 staff weeks per year Health Nutrition and 48 0 Assume 8 staff weeks per year Population Specialist (In- country) Health Economics/ 48 0 Assume 8 staff weeks per year financing/ Health Systems Specialist (In-country) Procurement 12 12 Assume 4 staff weeks year 1 and 1.5 staff weeks years 2-6 Financial Management 24 12 Assume 4 staff weeks per year Social Safeguards 24 12 Assume 4 staff weeks per year Other as identified needs 24 12 Assume 4 staff weeks per year Page 95 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) ANNEX 3: Primary Health Care Performance Initiative- Vital Signs Profile and Progression Model COUNTRY: Papua New Guinea Improving Access to and Value from Health Services in PNG: Financing the Frontlines 1. This annex includes PNG’s Vital Signs Profile and preliminary results from the Progression Model exercise conducted in PNG as part of the Primary Health Care Performance Initiative (PHCPI). These results are being used in PNG to inform the PHC performance management and monitoring discussion in PNG. The primary health care Vital Signs Profile (VSP) is a tool for assessing the strengths and weaknesses of a country’s PHC system. It is designed to systematically assess PHC across domains of the conceptual framework in simple way. The VSP profiles PHC systems across four pillars: Financing, Capacity, Performance, and Equity . 2. The VSP includes a set of standard indicators covering financing, access, quality, service coverage, equity, context and outcomes, from a number of data sources including the System of Health Accounts 2011, Service Availability and Readiness Assessment (SARA) and Harmonized Facility Surveys, Service Delivery Indicators (SDI), Service Provision Assessments (SPA) and Demographic and Health Surveys (DHS), and the Multiple Indicator Cluster Surveys (MICS). Alternative indicators are used when data for standard indictors is not available, too old or not appropriate, for a country. Part of the preliminary analysis is based on the data that was collected as a part of the Health Facility Efficiency Study in Papua New Guinea in 2015. PNG’s VSP will be completed when data from the recent DHS 2016-2018 are released. 3. The Progression Model is a mixed methods tool that brings together stakeholders who have complementary knowledge of the multiple aspects of the PHC system to develop an objective, comparable assessment of PHC functional capacities. The Capacity Pillar is created by combining the scores from the PHC Progression Model measures of the Governance, Inputs, and Population Health and Facility Management domains, as shown in the front page of the Vital Signs Profile (VSP). The score for each measure is given based on specific evidence gathered through multiple data sources for that measure. The score identifies a specific level of maturity of the system that ranges from 1 (lowest) to 4 (highest), following the pre-specified rubric for that measure. The color-coding of the results in the Capacity Pillar reflects the value of the total score, where green is assigned to scores of 4, yellow to scores of 2 and 3 and red scores of 1. Capacity Pillar results are comparable across countries because they are derived using the same methodology. The Progression Model for Papua New Guinea was discussed at an internal validation workshop held on October 7-8, 2019, in Port Moresby at the Lamana Hotel. Preliminary results are presented in this annex section and are being validated. Page 96 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Page 97 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Page 98 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Page 99 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) ANNEX 4: Map of the Independent State of Papua New Guinea Page 100 of 101 The World Bank Improving Access to and Value from Health Services in PNG: Financing the Frontlines (P167184) Page 101 of 101