From the formal PBF definition as well as 15 years of experience with PBF, the following best practices have been deducted:

1. Separate the functions of regulation, provision, fund disbursement, contract development & verification and community empowerment;
2. Stimulate competition for contracts among facilities and other stakeholders;
3. Promote public-private partnerships with equal treatment of public, religious and private providers;
4. Regulator does not interfere in facility management but defines output, quality and equity indicators. Regulator interferes only when facility becomes a danger to public health, or when the facility is engaged in criminal activities. Regulator costs out public budget with equity bonuses for vulnerable regions, facilities and individuals;
5. Providers are autonomous to hire and fire, set user fees and respond to government defined packages and patient or consumer demand;
6. Providers must assure that revenues and expenditures are balanced while providing high quality and equitable services with motivated qualified staff at the risk of non-renewal of contract and bankruptcy;
7. Contract development & verification (CDV) agencies negotiate contracts and coach facility managers to use business plans and indices instruments; the subsidy payment may be done by a different organization.
8. Local community groups enhance patient interests;
9. Promote efficiency and cost containment by CDV agencies and government to pay cash payments or cash subsidies for results instead of inputs in kind and by facilities to have free choice to purchase their inputs from independent distributors operating in competition;
10. Seek economic multiplier effects to generate employment, economic growth and tax revenues by deliberately injecting cash into the local economy;
11. Extend the PBF system towards other sectors than health.