The purpose of the Health Financing Activity (HFA) is to improve access to equitable and quality health services and prevent catastrophic health expenditure through increased resources for health, efficient allocation and utilization, and enhanced financial risk protection in alignment with Ethiopia’s

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overall aim of achieving Universal Health Coverage (UHC) through Primary Health Care (PHC) by 203 5. Health care financing reform in Ethiopia, initiated in 1998, aimed to improve the quality and equity of health services.

The strategy focused on increasing resources for health care, promoting efficiency, and ensuring long-term sustainability through multiple financing mechanisms.

Key interventions included revenue retention at health facilities, a fee-waiver system, standardized exemption services, and the introduction of health insurance schemes.

These reforms have significantly improved health service delivery and financial protection for citizens.

USAID’s investments in healthcare financing reform are largely focused on strengthening and institutionalizing health care financing (HCF) functions and systems to support universal health coverage of quality primary health care (PHC) services for Ethiopian citizens with reduced financial barriers.

The HFA will build upon the lessons derived from previous USAID Ethiopia Health Care financing reform initiatives, including the recent five-year Health Financing Improvement Program (HFIP).

The expected outcomes will be evidence-based and objectively measured through the progress made in the country's capacity to achieve sufficient, equitable, sustainable, and efficient financing for universal healthcare coverage.