The Russian Federation has undergone a process of major constitutional change in the post-communist period, as a strong central government has ceded extensive powers to the regions. This has important implications for the organization of the health care system which, as with other elements of the Soviet system, had previously been highly centralized. Although it is now well-recognized that the powers of the Federal Health Ministry have weakened considerably, the precise scale and nature of the process of decentralization remain imperfectly understood. This paper provides new evidence on the nature of decentralization in the Russian Federation since the breakdown of the USSR, reporting the results of case studies undertaken in six regions of Russia (Samara, Tver, Tula, Chelyabinsk, Sverdlovsk and Moscow oblasts) to describe the organization of health care financing, regulation and delivery. It shows that while there is a common model of health system (with the exception of Samara, where an innovative model was implemented), there are many minor variations. The study confirms the limited scope for action by Federal authorities, but also shows that the power vested in the regional governments is more limited than was previously thought. Instead, the municipalities (rayons) emerge as important bodies, as they own the facilities in which much of the routine health care is delivered and, both directly and indirectly, by virtue of their contributions of insurance premiums for the non-working, provide a substantial amount of health care financing. The study demonstrates the complexity of the Russian health care system and identifies the widespread absence of mechanisms that might be used to bring about much needed change.
China's transition into a market economy has exerted some influence on the health sector in terms of a significant growth of facilities, but it has also produced a range of destabilizing social costs. \n \n \n \nThis thesis analyzes the relations between healthcare pricing and payment reforms and the different delivery aspects such as the exemption program for the poor, public health programs for tuberculosis control and the provision of hospital services. A health economics and systems conceptual framework is used for analyzing aspects of the health systems in terms of market failures and the institutional response from governments and regulators. \n \n \n \nIn study I, the exemption programs for hospitals where the poor are relieved of paying the price or user charges are analyzed. The study is a case study where patient records from nine hospitals were reviewed, together with interviews with key informants and community representatives. The study showed that the discount offered was limited, where only a minority of indigents received discounts and the hospitals lacked incentives for efficiently carrying out the programs. \n \n \n \nStudy II investigates the effect of the new urban health insurance system on hospital charges. The study uses two tracers, acute appendicitis and normal childbirth, at six hospitals from two cities with different insurance systems. The result showed a lower rate of increase in hospitals charges in the city implementing the urban health insurance reform. Regression analysis showed contracting mechanisms and length of stay to be the main determinants for hospital charges. \n \n \n \nStudy III analyzes the operation of TB control programs in a decentralized financial system. A case study was conducted in four counties with different economic developments in the Shandong province. Data was collected from a review of documents and interviews with patients and key informants. The study showed weak government support to the TB control program and less developed DOT (directly observed therapy) programs in the poorer counties. TB patients suffered heavy financial burdens. The decentralized financing system had negatively affected the provision of public health programs such as TB control programs. \n \n \n \nIn study IV, the impact of retail price control of drugs on hospital drug expenditures was examined. The study is a case study at two hospitals. Total drug expenditures were analyzed based on financial records and a tracer, cerebral infarction, was used for an in-depth examination of prices, volume, expenditures and rationality of drug use. Findings showed that after the implementation of the drug pricing policy, total drug expenditures increased as rapidly as before. Drug expenditure per patient for cerebral infarction showed indistinct results, indicating that the regulation was not effective. Utilization rather than price was more determinative for drug expenditures. \n \n \n \nStudy V investigates the development of revenues, costs and performance in the hospital sector. In a sample of 41 hospitals in two cities, the use of inputs, investments and productivity was estimated. The findings showed that hospitals had expanded their staff and invested in new medical equipment. The corresponding change of outputs in terms of outpatient and inpatient performance showed a slower increasing rate, resulting in a diminishing productivity rate over time. \n \n \n \nThe market-oriented health care system in China is faced with different 'market failures' problems such as limited access to health services for the poor and the inaccuracy in relying on market mechanisms for services characterized by positive externalities, such as the public health programs. Financial autonomy has given health providers the incentives to maximize revenues. Government interventions to contain costs and improve efficiency show that a sole reliance on the price mechanism is insufficient and must be combined with other tools set by regulators and insurers.
This chapter provides an overview of the key issues in public economics arising from the process of territorial decentralization that has taken place in Spain since the restoration of democracy and ratification of the Constitution of 1978, which resulted in the emergence of the “ Autonomic State ”. The first section of this chapter focuses on the assignment of competencies between central and regional levels of government and explains in detail the methodology used to quantify the “effective cost” of the services devolved to the Autonomous Communities (hereinafter ACs). We have paid special attention to health services, which are the most significant item for regional budgets in quantitative terms. The second section deals with revenue assignment and describes the two systems established to finance regional expenditures. These two systems are the “ordinary system” (régimen común), which is applied in the majority of the ACs, and the “charter system” (régimen foral), which is based on the historical rights accorded to the Basque Country and Navarre . The last section gives an appraisal of the decentralization process and notes some emerging issues of debate.
This article reviews changes in the organization, delivery and financing of health care and old age services in the UK and Sweden over the past 25 years. User autonomy has become a more important policy objective than equity of access or equality of opportunity, with a greater reliance on market mechanisms for delivering services. The public and politicians seem to be prepared to accept that competition, choice and decentralization may result in a widening of regional and geographical inequalities, and the erosion of the universal character of the welfare state. These developments reflect broader normative shifts in both societies, and are likely to continue and become more widespread in the future, as they will be strongly influenced by demographic and social factors, fiscal constraints and the policies of supranational bodies such as the European Union.
In order to understand the impact of specific maternal health interventions, it is necessary to understand the likely effect of the health system structure. An important aspect of this structure is the organizational culture. Many systems in low-income countries have been based on a centrally planned and financed system. In recent years a series of organizational changes have been introduced into many systems and these substantially alter the way in which the system operates and impacts on reproductive health care provision. The main changes reviewed in this paper are: (i) decentralization, (ii) privatization and (iii) integration and sector wide approaches. Each of these changes is seen to have important implications for reproductive health. In each case it is clear that the nature of the impact depends crucially on the way it is implemented. Quantifying the impact of these changes remains extremely difficult given the many different ways they can be introduced and the many confounding factors that affect the overall impact. The literature does, however, point to a number of key issues that impinge on the way in which change is likely to affect reproductive health initiatives.
This chapter provides an overview of the key issues in public economics arising from the process of territorial decentralisation that has taken place in Spain since the restoration of democracy and the Constitution of 1978, and which resulted in the emergence of the “Autonomic State”. The first section focuses on the assignment of competencies between central and regional levels of government and explains in some detail the methodology used to quantify the “effective cost” of the services devolved to the Autonomous Communities (hereinafter ACs). We have paid special attention to health services, which is the most significant item for regional budgets in quantitative terms. The second section deals with revenue assignment, transfers and borrowing, and describes the two systems established to finance regional expenditure. These are the “common system” (régimen común) applied in the majority of the ACs and the “charter system” (régimen foral), which is based on the historical rights accorded to the Basque Country and Navarre. The last section appraises the decentralisation process and notes some emerging issues of debate.
India has set out ambitious goals for itself in the health sector in its Tenth Five Year Plan (2002-07). It is also a signatory to the United Nations Millennium Development Goals. Attainment of these goals which are time-bound will require a massive scaling up of investment in health, especially in public primary health care. We argue for a ‘Health for All’ initiative on the part of the government akin to the ‘Education for All’ scheme which was launched nation-wide in 2001. The large amount of resources required for scaling up public investment in primary health need not be the constraint it is purported to be. We discuss several options that are available to the government for generating the necessary funds. Among the options that can generate resources domestically are reform of the government’s subsidies regime including implementing life-line tariffs, ear-marking taxes and disinvestment of loss-making public sector units. Health for All can also be financed by raising more resources via external assistance. Official development assistance to India at present is rather low given India’s per capita income and the scale of its needs in human development terms. The scale of official development aid to India should increase several folds and committed use of funds should be made by the government in health and other priority sectors. With the 73rd and 74th amendments to the Indian Constitution which created a third tier of government comprising of elected local bodies at the village and town ward levels, a decentralized system of service delivery will eventually become a reality in India and needs to be a part of any debate on the means and modes of improving human development outcomes in India. The current system of planning and allocation of funds at the sub-national level however needs to be over-hauled if fiscal decentralization is also to become a reality.
Bunnan Men, John Grundy, Jeff Cane, Lon Chan Rasmey · 10 authors
The following study was conducted as part of a review of management systems at a Provincial Health Department (Kampong Cham Province) and a National Health Programme (National Immunization Program) in 2002-2003 in Cambodia. The aim of this paper is to identify, analyse and recommend those management system factors that are critical to the success of health management performance, with a particular focus on provincial management. The review has identified critical success factors associated with health management performance at the sub-national level that include a stronger role for effective human resource management in health sector reform, elevation of the status of planning in senior level management, and the development of a more comprehensive and transparent finance system. These success factors will position the provincial level of health management to respond more effectively to the reform challenges of administrative de-concentration and political decentralization that are currently underway across a range of government sectors in Cambodia.
The Danish health care system has undergone gradual changes, but not radical reforms, from 1970 until 2004. Theoretically, the development can be viewed from the perspective of fiscal federalism, decentralization, and incentives embodied in reimbursement systems. Furthermore, path dependence and incrementalism have characterized the system. The Danish health care system is decentralized politically, financially, and operationally. The counties are responsible for health care, and finance it out of county income and property taxes along with block grants from the state. Hospitals are publicly owned while general practitioners are private entrepreneurs working on contract with the counties. Hospital services and GP and specialist services are free, while there are co-payments for drugs, adult dental care, physiotherapy and the like. Co-payments make up close to 19% of total health expenditures. The system has been characterized by expenditure control, reasonable positive development in productivity, and a high degree of patient and citizen satisfaction despite waiting lists. Free choice of hospital was introduced more than 10 years ago. It has recently been expanded so that after waiting 2 months for treatments like elective surgery at public hospitals, citizens can choose either private hospitals or go abroad with full payment from public funds. The thinking behind decentralization gradually has been eroded for a number of reasons. This has led to a reform that will be effective as of January 2007. The number of counties will be reduced, but the new regions retain responsibility for health care. A national earmarked health tax will be introduced so that the regions will receive revenues from state block grants and municipal co-payment, for instance an amount per hospitalization.
One of the limitations of cross-country health expenditure analysis refers to the fact that the financing, the internal organization and political restraints of health care decision-making are country-specific and heterogeneous. Yet, a way through is to examine the influence of such effects in those countries that have undertaken decentralization processes. In such a setting, it is possible to examine potential expenditure spillovers across the geography of a country as well as the influence of the political ideology of regional incumbents and institutional factors on public health expenditure. This paper examines the determinants of public health expenditure within Spanish region-states (Autonomous Communities, ACs), most of them subject to similar financing structures although exhibiting significant heterogeneity as a result of the increasing decentralization, region-specific political factors along with different use of health care inputs, economic dimension and spatial interactions.
Samuel S. Lieberman, Joseph J. Capuno, Hoàng Văn Minh
This paper examines decentralization experiences in Indonesia, the Philippines and Vietnam during the last 18 years (1985-2003). The analysis suggests that decentralization dividends so far have been modest and concentrated in some areas in the country. This is partly macroeconomic and political context in which decentralization was introduced. More importantly, however, current arrangements within the health sector have not worked well as hoped, including ensuring access for the poor to quality health services. To improve the gains, a stewardship role for the MOH is suggested. In this role, the MOH would focus on critical health functions, namely: communicable disease surveillance and control; standard setting and quality assurance for devolved health services; and pharmaceuticals; ensuring access of the poor to health services; and, sustaining health financing.
The severe acute respiratory syndrome (SARS) crisis in China revealed not only the failures of the Chinese health-care system but also some fundamental structural deficiencies. A decentralized and fragmented health system, such as the one found in China, is not well-suited to making a rapid and coordinated response to public health emergencies. The commercial orientation of the health sector on the supply-side and lack of health insurance coverage on the demand-side further exacerbate the problems of the under-provision of public services, such as health surveillance and preventive care. For the past 25 years, the Chinese Government has kept economic development at the top of the policy agenda at the expense of public health, especially in terms of access to health care for the 800 million people living in rural areas. A significant increase in government investment in the public health infrastructure, though long overdue, is not sufficient to solve the problems of the health-care system. China needs to reorganize its public health system by strengthening both the vertical and horizontal connections between its various public health organizations. China's recent policy of establishing a matching-fund financed rural health insurance system presents an exciting opportunity to improve people's access to health care.
ABSTRACT - The Portuguese National Health Service (SNS), a universal, centralized and public owned health care system, exhibits an extraordinary record of equalization in the access to health care and health gains in the late thirty years. However, the most recent history of the Portuguese health reform is pervaded by the influence of decentralization and privatization. Decentralization has been present in the system design since the 1976 Constitution, at least in theory. Private ownership of health care suppliers and out-ofpocket expenditures, on the financing side, both have a long tradition of relevance in the NHS mix of services. The initial aim of this study was to demonstrate expected parallelism between health reforms and public administration reforms, where a common pattern of joint decentralization and privatization was observed in many countries. Observers would be tempted to consider these two movements as common signs of new public management (NPM) developments. They have common objectives, are established around the core concepts of gains in effectiveness, efficiency, equity and quality of public services, through improved accountability. However, in practice, in Portugal, each movement was developed in a totally separated way. Besides those rooted in the NPM theory, there are few visible signs of association between decentralization and privatization. Decentralization, in the Portuguese SNS, was never intended to be followed by a privatization movement; it was seen merely as a public administration tool. Private management of health services, as stated in the most recent SNS legislation, was never intended to have decentralization as a condition or as a consequence. Paradoxically, in the Portuguese context, it has led invariably to centralized control. While presented as separate instruments for a common purpose, the association between decentralization and privatization still lacks a convincing demonstration. Many common health care management stereotypes remain to be checked out if we want to look for eventual associations between these two organizational tools.
The government dominates health care in Britain, France and Germany, but there are a number of significant differences between the three countries. In Britain, health care is financed by general taxation, whereas the French and German systems are both insurance-based. Spending on health is higher, and the health systems are more decentralized, in France and Germany than in Britain. These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.
ABSTRACT - The Portuguese National Health Service (SNS), a universal, centralized and public owned health care system, exhibits an extraordinary record of equalization in the access to health care and health gains in the late thirty years. However, the most recent history of the Portuguese health reform is pervaded by the influence of decentralization and privatization. Decentralization has been present in the system design since the 1976 Constitution, at least in theory. Private ownership of health care suppliers and out-ofpocket expenditures, on the financing side, both have a long tradition of relevance in the NHS mix of services. The initial aim of this study was to demonstrate expected parallelism between health reforms and public administration reforms, where a common pattern of joint decentralization and privatization was observed in many countries. Observers would be tempted to consider these two movements as common signs of new public management (NPM) developments. They have common objectives, are established around the core concepts of gains in effectiveness, efficiency, equity and quality of public services, through improved accountability. However, in practice, in Portugal, each movement was developed in a totally separated way. Besides those rooted in the NPM theory, there are few visible signs of association between decentralization and privatization. Decentralization, in the Portuguese SNS, was never intended to be followed by a privatization movement; it was seen merely as a public administration tool. Private management of health services, as stated in the most recent SNS legislation, was never intended to have decentralization as a condition or as a consequence. Paradoxically, in the Portuguese context, it has led invariably to centralized control. While presented as separate instruments for a common purpose, the association between decentralization and privatization still lacks a convincing demonstration. Many common health care management stereotypes remain to be checked out if we want to look for eventual associations between these two organizational tools.
Fiji is currently implementing health care reforms with the first phase of reforms focusing on decentralization of the health system. Part of this effort focuses on looking at financing options. Some options for financing health care include private health insurance, social insurance, community financing, user-pays system (out-of-pocket), health savings accounts, government taxation and subsidies, and overseas loans and aid funding. This paper addresses all these options in detail and provides an analysis into each of these options relevance to Fiji and in some instances to other nations in the South Pacific region. Given the relative small populations of Fiji and its neighbouring nations, a regional approach to financing could prove more viable in the longer-term, however political, social, economic, legal and cultural issues will need to seriously explored.
John Grundy, Valentine Healy, L Gorgolon, E Sandig
INTRODUCTION: In 1991 the Philippines Government introduced a major devolution of national government services, which included the first wave of health sector reform, through the introduction of the Local Government Code of 1991. The Code devolved basic services for agriculture extension, forest management, health services, barangay (township) roads and social welfare to Local Government Units. In 1992, the Philippines Government devolved the management and delivery of health services from the National Department of Health to locally elected provincial, city and municipal governments. AIM: The aim of this review is to (i) Provide a background to the introduction of devolution to the health system in the Philippines and to (ii) describe the impact of devolution on the structure and functioning of the health system in defined locations. METHOD: International literature was reviewed on the subjects of decentralization. Rapid appraisals of health management systems were conducted in both provinces. Additional data were accessed from the rural health information system and previous consultant reports. RESULTS: Subsequent to the introduction of devolution, quality and coverage of health services declined in some locations, particularly in rural and remote areas. It was found that in 1992-1997, system effects included a breakdown in management systems between levels of government, declining utilization particularly in the hospital sector, poor staff morale, a decline in maintenance of infrastructure and under financing of operational costs of services. CONCLUSION: The aim of decentralization is to widen decision-making space of middle level managers, enhance resource allocations from central to peripheral areas and to improve the efficiency and effectiveness of health services management. The findings of the historical review of devolution in the Philippines reveals some consistencies with the international literature, which describe some negative effects of decentralization, and provide a rationale for the Philippines in undertaking a second wave of reform in order to 'make devolution work'.
Nazmul Chaudhury, Jeffrey S. Hammer, Edmundo Murrugarra
This study examines the impact of a fee-waiver program for basic medical services on health care utilization in Armenia. Due to the reduction in public financing of health services and decentralization and increased privatization of health care provision, private out-of-pocket contributions are increasingly becoming a significant component of health costs in Armenia. To help poor families cope with this constraint, the Government of Armenia provided a free-of-charge basic package service to eligible individuals in vulnerable groups, such as the disabled and children from single parent households. Drawing upon the 1996 and 1998/99 Armenia Integrated Survey of Living Standards (AISLS), which allows the identification of eligible individuals under this program, we estimate the impact of the fee-waiver program on utilization of health services, particularly among the poor. Across the two survey rounds utilization rates have indeed declined despite comparable levels of income, and this decline has occurred among both the poor and the rich, with average utilization falling by 12 percent between the two surveys. However, families with four or more children, the largest beneficiary group under the "Vulnerable Population" program, have decreased their usage of health care services in a disproportionate manner -- 21 percent reduction in usage between the two survey rounds. This precipitous drop in health care usage by this vulnerable group despite being eligible for free medical services, suggests that the program just by itself was inadequate in stemming the decline in the usage of health services. We furthermore present evidence to suggest that the free-of-charge eligibility program is acting more like an income transfer mechanism, particularly to disabled individuals. Contents...
District health systems, comprising primary health care and first referral hospitals, are key to the delivery of basic health services in developing countries. They should be prioritized in resource allocation and in the building of management and service capacity. The relegation in the World Health Report 2000 of primary health care to a 'second generation' reform--to be superseded by third generation reforms with a market orientation--flows from an analysis that is historically flawed and ideologically biased. Primary health care has struggled against economic crisis and adjustment and a neoliberal ideology often averse to its principles. To ascribe failures of primary health care to a weakness in policy design, when the political economy has starved it of resources, is to blame the victim. Improvement in the working and living conditions of health workers is a precondition for the effective delivery of public health services. A multidimensional programme of health worker rehabilitation should be developed as the foundation for health service recovery. District health systems can and should be financed (at least mainly) from public funds. Although in certain situations user fees have improved the quality and increased the utilization of primary care services, direct charges deter health care use by the poor and can result in further impoverishment. Direct user fees should be replaced progressively by increased public finance and, where possible, by prepayment schemes based on principles of social health insurance with public subsidization. Priority setting should be driven mainly by the objective to achieve equity in health and wellbeing outcomes. Cost effectiveness should enter into the selection of treatments for people (productive efficiency), but not into the selection of people for treatment (allocative efficiency). Decentralization is likely to be advantageous in most health systems, although the exact form(s) should be selected with care and implementation should be phased in after adequate preparation. The public health service should usually play the lead provider role in district health systems, but non-government providers can be contracted if needed. There is little or no evidence to support proactive privatization, marketization or provider competition. Democratization of political and popular involvement in health enhances the benefits of decentralization and community participation. Integrated district health systems are the means by which specific health programmes can best be delivered in the context of overall health care needs. International assistance should address communicable disease control priorities in ways that strengthen local health systems and do not undermine them. The Global Fund to Fight AIDS, Tuberculosis and Malaria should not repeat the mistakes of the mass campaigns of past decades. In particular, it should not set programme targets that are driven by an international agenda and which are achievable only at the cost of an adverse impact on sustainable health systems. Above all the targets must not retard the development of the district health systems so badly needed by the rural poor.
Open access
Healthcare Policy and Management
Health Systems, Economic Evaluations, Quality of Life