The study examined the effect of financial rewards on performance of health workers in Government Hospitals in Uganda. A case of Kiruddu hospital. The study was anchored on two specific objectives, namely: to examine the effect of direct financial rewards on the performance of health workers at Kiruddu hospital and to examine the effect of indirect financial rewards on the performance of health workers at Kiruddu hospital. A cross-sectional research design using a convergent parallel mixed methods approach was used to answer the study questions. A sample size of 169 respondents was considered for the study, 155 respondents participated, giving a response rate of 92%. The study established that financial reward practices (direct financial rewards and indirect financial rewards) have a statistically significant relationship and significantly positively affect performance of health workers at Kiruddu Hospital. The study found out salary at Kiruddu Hospital is paid promptly and on time and that Kiruddu Hospital offers a wide range of indirect financial rewards to health workers ranging from health insurance, housing and transport allowances. It was also revealed that health insurance is only given to few family members of health workers, leaving out majority of the family members from benefiting, paid training opportunities at Kiruddu hospital are discriminative hence not all staffs benefit from them. The study recommends that; Top leadership of Kiruddu Hospital and the Ministry of Health to review the existing direct financial reward systems by benchmarking with private hospitals and other Government Hospitals in the region, introduce performance based pay system that clearly and directly links direct financial rewards to performance, increase salaries of health workers annually, prioritize recruitment of more health workers and equip all Government hospital with all sorts of medicine so that patients are not asked to buy anything.