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Bankauskaite, V., & Saltman, R. B. (2007).Defining decentralization
Decentralization consists of four-part classification:
1. Delegation: transfer of responsibility to lower organizational level
2. De-concentration: transfer to lower administrative level (criticism: it does not require
decentralization of power, since it does not provide opportunity to exercise local discretion
in decision making, therefore it is not a form of decentralization)
3. Devolution: transfer authority to a lower political level (criticism: it implies divestment of
functions by central government and creation of units of governance not in direct control of
central authority, therefore devolution and decentralization different phenomena
devolution is inter-organization pattern while decentralization is intra-organizational pattern
of power relationships)
4. Privatization: transfer tasks from public into private ownership (criticism: different concepts
because decentralization describes transfer from core to periphery, while privatization
describes transfer from public to private sectors
Conceptual issues, not all are recognized; not clear when something is (not) decentralization
Decentralization is both a state and a process?
Measuring decentralization?
Challenges: 1) measuring as a state and process, 2) outcomes in HC 3) international comparisons
Politics, values and decentralization
- Political dimensions (structural issue + values = context for decentralization)
o Structural issue: how decentralization affects/affected by existing institutions of gov
o Social and cultural values: what values led to and sustain particular set of
governmental institutions
o Steering questions: involves areas like regulatory structure, framework laws, intra-
country negotiation procedures
Political dimensions come to bear on likely impact decentralization may have within a health
care system
Role of politics cannot be overestimated, importance of institutions and
political dimension
Political economy perspective/approach to decentralization, economy is
important driver behind decentralization
Public participation and decentralization: local responsiveness and allocative
efficiency, but limited representativeness due to weak formal structures
Migration, ‘people voting with their feet’ when unsatisfied with the way their
needs are addressed
Fundamental disagreement on values in health policy stakeholders and
decisionmakers
Subsidiarity principle not always effective: incentives local government not
always priority for central government
Accountability and transparency are necessary to monitor performance and
ensure equal standards, but subnational units are not enthusiastic about
accountability and transparency, complicating things for central government
Financing and decentralization (fiscal federalism)
“The division of taxing and expenditure functions among different levels of government”
Dilemmas of central government providing revenue for local authorities
1. Central contribution contradict notion of local accountability
, 2. High decentralization creates high levels of grant dependency, particularly when there are
unconditional grants from higher government levels that don’t limit discretion of lower levels
3. To ensure accountability, the purchasing and taxing authority should be in the same
institutional hands, making decentralization provision more expensive then centralized
Financial issues not only dependent on principles of public finance
- Context: what constitutes a high degree of decentralization? High number of responsibilities
or low grant dependence (raising most revenues from local sources) for local governments
- Cross-subsidies: low-revenue regions can get subsidized from high-revenue regions to reduce
poverty, but can lead to political tension between losers and winners
- EU’s solidarity: pushing responsibility of service provision to lowest level for participatory
democracy and efficiency gains (match service-citizen), leading to more responsibility for
subnational government, reinforcing need for fiscal decentralization to fund services
Outcomes and decentralization
Complex and ambiguous evidence regarding outcomes of decentralization
- Capacity to innovate within city councils
- Improved efficiency
- More patient-oriented system
- Enhanced cost-consciousness
- Higher regional and local authority accountability
- Stimulation of broader change regarding work organization and working time
- Better implementation of health care strategies based on need
- Inequity (most inequality and inequity in former communist countries)
Question of decentralized health care and newly emerging health care needs in Europe
- Long-term care: consolidation of administrative functions. Differences between NL and
Scandinavian countries in decentralization
- Integrated networks: decentralization is essential to development of effective integration of
different health systems, social and health care
- Improved access mental health services: community-based interventions decentralization
is useful for integration of health and social care services to address mental health issues
Pavolini, E., & Vicarelli, G. (2012).
Introduction
Global trend of decentralization in recent reforms in health care: Italian context
- Positive effects of decentralization on health care
- Cost containment: better knowledge of needs and supply system by local decisionmakers
- Allocation efficiency: matching needs and services by decentralized governments
- Higher level of participation by local communities/citizens in building their healthcare system
- Integration social- and healthcare services due to ageing population + rising chronic diseases
Risks of decentralization:
- Hidden retrenchment strategy: cutting social rights and increasing social inequalities
o Blame avoidance mechanism: increasing sub-national expenditure responsibilities
without corresponding increase in revenues, forcing local governments to enact cuts
- Potentially widens territorial health(care) inequalities
o Zero-sum game in which health-care related gains of strong regions might be
obtained at the expense of weaker regions
Changes taking place in context characterized by
- High debt and need to get into European Economic Area, respect SGP
- Relatively market territorial socioeconomic differences
, - Relationship between territorial inequalities and other inequalities among healthcare
(gender, race, ethnicity)
Is decentralization in effect a hidden retrenchment strategy?
Does it widen territorial healthcare inequalities?
And, what is its impact on healthcare gender inequalities?
The Italian model of healthcare decentralization in a comparative view
Transformation in the Italian NHS
- Phase 1. 1978-1992: decentralization starting, shift from health insurance-based system to
NSH (1978). Powers/responsibilities were shared ambiguously between state and local
government. Local gov. more responsible for implementing rather than planning HC
- Phase 2. 1992-2001: HC reform laws, organization and management of NHS transfer to 20
regions (unitary state model neo-regionalist model) with regional HC models emerging
- Phase 3. 2001-2011: federalist transition of NHS, stronger regionalization by amendments to
Italian constitution national policy making negotiated between gov. and regions
Overall, more autonomy for local NHS, but differences between territories:
1. Italy has great differences in capabilities of public bureaucracies to function efficiently
and effectively (South vs North)
2. Differences in performance are matched by equivalent economic development divide
Decentralization and institutional contexts: Italy in the European context
Comparison to other European countries’ healthcare systems
- Germany: federalism and corporatism. Federal gov. ensures common framework, decision-
making is delegated to complex set of public law institutions with SHI and ASHIP. Länder
responsible for maintaining hospital infrastructure and activities of prevention and public
health. Fragmentation of hospital and ambulatory care, strong medical power, State has
played a more interventionist role.
- France: double drive towards centralization in spending power, but decentralization in
territorial planning and service management. Since 90’s reforms promote model of
decentralization, but no change to unitary nature of the country. Most reforms transfer
competences from central state to peripheral bodies, no delegation of political/fiscal power.
Weakest process of decentralization compared to other EU countries.
- UK: two phases, first involving decisions by conservative gov. in 90’s, later phase involving
labour gov., with first reforms so radical it required resolution of paradox: internal market
model made local actors final decision makers, while it prevented some health authorities
from boycotting/limiting effects of reforms. Resulted in process that centralized NHS on
national level, to strengthen introduction of purchaser-provider split on local level.
Devolution policies were introduced in late 90’s, granting more autonomy to Whales,
Scotland and North Ireland, but fiscal and political decentralization was asymmetrical
between the 4 countries. Paradoxically, decentralization and centralization march occur
simultaneously the UK.
- Spain: characterized by a process of asymmetrical and incremental decentralization at 17
autonomous communities (CA). In 2002 healthcare management powers were shifted from
central gov. to all 10 CA’s. Fiscal autonomy of CA was expanded, CA’s health care systems are
funded by financial transfers from central government
Italy: characterized as the country that, while historically a unitary state, is driven towards
political-administrative decentralization process. Geographical differences and power and
capacities of local governments were not taken into account (unlike UK and Spain). Political-
administrative decentralization took place in Italy, which has the most problematic territorial
differences in economic development and administrative capabilities in West-EU.
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