How Conditional Cash Transfers Work for Health

By Nadin Medellín, Marco Stampini, and Pablo Ibarrarán

(Versión en español aquí)

The use of health services by disadvantaged populations in Latin America and the Caribbean has improved in recent years, as have the overall health conditions of these populations. This is due to a variety of factors, including the fact that approximately 30 million families participate in some type of conditional cash transfer program. Through these programs, families receive financial support from the government on a regular basis. The programs are often seen as handouts that do not translate into structural changes in families. However, the reality is different.


What Is the Aim of Conditional Cash Transfer Programs?

Conditional cash transfer programs consist of a social pact between the government and families living in poverty. For its part, the government commits to provide health and education services for the families. For their part, the families agree to a series of commitments such as ensuring that their children attend school and have medical check-ups.

The idea is that by requiring families to comply with these conditions, today’s children will become better educated and healthier adults. In addition, families that meet these commitments regularly receive financial support. Thus, the financial support that the government provides through these programs is a long-term investment that can translate into improvements in productivity in the future.  

Conditional cash transfer programs incentivize the demand for health services because they affect certain social determinants of health. We know that, for some families, it is difficult to afford the direct and indirect costs of going to a health center, even if the services are free of charge. In fact, the World Health Organization and other studies have recognized the importance of boosting demand for health services, which is precisely what conditional cash transfer programs aim to do. Through the financial support they provide, these programs look to break down economic barriers as well as provide information to families on the importance of health care methods and health promotion.


Do Conditional Cash Transfer Programs Work for Health?

The short-term objective of conditional cash transfer programs is to increase the use of preventive health services, principally among children and pregnant women. There is ample evidence that conditional cash transfer programs contribute to this objective. Almost all countries have reported increases in the use of health services. According to the evidence, in the case of children, the use of health services for children from 0-3 years of age went from 44 to 64 percent in Honduras. In Jamaica, the number of health center visits in the last six months doubled for children from 0-6 years of age (the impact ranges from 6.3 percentage points in Nicaragua to 33 percentage points in Colombia).  There are studies that describe the cases of Colombia and Brazil, as well as a general overview.

Another indicator of interest is the presence of skilled health care personnel at births, which increased by 11 percentage points in Mexico and 12 percentage points in El Salvador (the same study reports an increase of 36 percentage points in India). Finally, there is evidence that in Brazil health check-ups also increased for older siblings: visits by children and youths between the ages of 7 and 17 increased even though they were not required to go to the doctor as a condition under the program. This shows that the programs succeeded in changing behaviors beyond the actions specified as conditionalities.

Although the immediate objective of conditional cash transfer programs is to draw people to health services, what is important is to improve the health of the population. It is important to clarify that even though this depends not on the programs, but rather on the quality of the health services, conditional cash transfer programs should be analyzed to determine if they have had an impact on the health conditions of the beneficiary population.

Here there is also good news. In Mexico, a decline of 4.6 percentage points in the percentage of children with low birth weight has been documented along with a 56 percent decline in hospitalizations of children up to 2 years of age, which shows the effectiveness of preventive health programs. In Brazil, the probability of mortality among children under 5 years of age declined by between 6 and 17 percent among beneficiaries of the Bolsa Familia Program compared to similar groups that did not participate in the program. The decline was particularly pronounced for causes of death associated with poverty, such as malnutrition and diarrhea. In addition, in Mexico, where the program encourages all members of households to use health services, a study of rural areas in 2007 showed that vaccination rates among adults for influenza, pneumococcal diseases, and tetanus increased by between 5 and 8 percentage points.


How Do Conditional Cash Transfer Programs Work?

Although it may sound simple, operating transfer programs on a large scale is very complicated. It is necessary to define and, in some way, identify the target population, program conditionalities and mechanisms to verify them, and the structure of the transfers and the scheme to make the payments in an efficient manner. Several Latin American and Caribbean countries have been working in this area for 20 years, with encouraging results. A new publication from the Inter-American Development Bank explains how these programs work, identifies best practices, and discusses the challenges involved in operating them and how they can be improved to achieve a greater impact, both in terms of health and other dimensions.  

What other experiences do you know of that impact the social determinants of health? How do you think the effectiveness of cash transfers could be improved to promote healthier lifestyles?

Share your ideas mentioning @BIDgente en Twitter.

To learn more about how conditional cash transfer programs are improving lives, you can download the publication “How Conditional Transfers Work” free of charge.


Nadin Medellín is a consultant in the area of social protection in the Division of Social Protection and Health of the Inter-American Development Bank.

Marco Stampini is a leading specialist on social protection in the Division of Social Protection and Health of the Inter-American Development Bank.

Pablo Ibarrarán is a leading specialist on social protection in the Division of Social Protection and Health of the Inter-American Development Bank. 

Social Protection Programmes: 
  • Social assistance
    • Social transfers
      • Cash transfers
        • Conditional cash transfers
Social Protection Topics: 
  • Benefits level
  • Benefits payment/delivery
  • Conditionalities
  • Coverage
  • Feedback and complaints mechanisms
  • Governance
  • Targeting
Cross-Cutting Areas: 
  • Health
  • America
  • Latin America & Caribbean
The views presented here are the author's and not's


Conditional cash transfers proved to be one of the most prevalent social assistance programs in low and middle-income countries. In Latin America and the Caribbean conditional cash transfer programs are affecting over 135 million people. These programs are expanding at a fast pace. Over fifty countries worldwide operate CCTs, more than twice the number in 2008.
The first generation of CCT programs and associated impact evaluation studies produced considerable evidence suggesting that these programs demonstrably helped lift many families out of poverty and have improved short-term educational, nutritional and health outcomes of millions of children worldwide.
Ephraim Zagelbaum