1 / 26

The Changing Role of the State

The Changing Role of the State. Simon Blair 15 May 2001. Huge Variability in Degree of Private “ Invasion ”. 40%* of countries have > 50% of health costs met by non-government sources 0.9% 99.3% 5 < 10% ; 10 > 90% The ‘ ironic antithesis of expectation ’

maj
Download Presentation

The Changing Role of the State

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. The Changing Role of the State Simon Blair 15 May 2001

  2. Huge Variability in Degree of Private “Invasion” • 40%* of countries have > 50% of health costs met by non-government sources • 0.9% 99.3% • 5 < 10% ; 10 > 90% • The ‘ironic antithesis of expectation’ • Historical legacy, ideology, affordability, relative strengths of governments and markets, and consumer expectation as influencing factors • An observable, evolutionary path

  3. The Economic Arguments • For government involvement: Public goods / externalities Market failures re info asymmetry • Against government involvement: ‘Neo-classical’- private ownership, competition & efficiency Institutional – property rights & provider incentives

  4. And in real life …… • Overall a declining % of expenditure is state funded

  5. Public Share of Total Health Expenditure 100% 90% 80% 70% 60% 1977 Public as % total HE 50% 1987 1997 40% 30% 20% 10% 0% 0 10000 20000 30000 40000 50000 GNP per capita

  6. And in real life…… • Declining/flattening government %s • Emotion > evidence ; correlations not as many envisage • Both economic and empirical evidence suggest optimal results are derived from mixed systems • Policy issues vis a vis the role of the state are critical for low and middle income countries • ‘Externalities’ argument valid for public health, medical education, and R & D

  7. Vocal critics are becoming evermore ‘aggressive’… “political considerations not only strengthen the case for privatization, but actually are the crucial reason for it in the first place” Shleifer “government enterprises are far more likely to engage in wasteful, anti-competitive pricing than private ones” Lott

  8. Role ‘recalibration’ now has wider support “Active government involvement in providing universal health care has contributed to the great gains – but many governments have overextended themselves. Efforts to provide all services to all people have led to arbitrary rationing, inequities, non-responsiveness and inadequate finance for essential services.” WHO 1999

  9. Support for ‘recalibration’ (2) “Unfortunately weak institutional capacity to deal effectively with regulatory problems in the private sector often causes governments to become excessively involved in the direct provision of health services. Such over-involvement is typically associated with insufficient government involvement in: regulating the private sector; financing essential services and securing access to public goods with large externalities for the whole population.” WB 1998

  10. Support for ‘recalibration’ (3) • All State systems examined in a recent “Economist” report showed one or more of the following symptoms : • Shortages of funds • Inefficiency / lack of cost containment • Hospital overcapacity • Access inequities • Inappropriate hospitalization

  11. From “classical” to “new” universalism “The values of WHO when combined with the evidence …cannot lead to a form of public intervention that has governments attempting to provide and finance everything for everybody. This ‘classical’ universalism … fails to recognize both resource limits and the limits of government.” (1999)

  12. Government and Market Involvementin Health Systems Government ? Purchasing/ Contracting Revenue Collection Service Delivery ? Market Forces

  13. Role Of Government Steering P R Policy Regulations Contracts Subsidies Service Delivery Compliance C SD Rowing C SD Unbalanced - Government excessively involved in “Rowing Function” and not sufficiently involved in “Steering Functions” Balanced - Government activities concentrated on “Steering Functions”

  14. Government Roles in HNP Sector Distorted Roles C More Balanced Roles F P R F P I R I I Information R Regulation C Contracting F Financing P Provision C

  15. HOW ESSENTIAL IS PUBLIC SECTOR INVOLVEMENT IN HEALTH CARE? Stewardship Revenue collection Fund pooling Purchasing Provision Least essential Most essential

  16. The Nature of Health Care GoodsBased on Neo-Institutional Economics Medium Contestibility Low Contestibility High Contestibility Type III Type II Type I • Production • Pharmaceuticals • High Technology • Wholesale • Drugs • Medical Supplies • Other Goods • Retail of • Drugs • Medical Supplies • Other Goods High Measurability Type VI-A Type V-A Type IV - A • Management Services • Training • Routine Diagnostics • Hospital Support Services • High Tech Diagnostics • Research Low Measurability Asymmetry No Asymmetry Type IV-B Type VI-B Type V-B • General Hospitals • Public Health Services • Health Insurance • Policymaking • Monitoring/Evaluation • Ambulatory Clinical Care • Medical • Nursing • Dental

  17. Dealing with Low Contestibility and Information Asymmetry Medium Contestibility Low Contestibility High Contestibility High Measurability Information Disclosure Regulations and Contracting Low Measurability Asymmetry No Asymmetry Public Financing Production

  18. Shifting the Grid and Boundaries of Public Interventions High Contestibility Medium Contestibility Low Contestibility High Measurability Information Disclosure Regulations and Contracting Low Measurability Asymm No Asymm Public Financing Production

  19. The Dynamic Nature ofHealth Care Goods and Services Medium Contestibility Low Contestibility High Contestibility Type III Type II Type I ExpensiveEquipment and Drugs High Measurability Type VI-A Type V-A Type IV - A Low Measurability Asymmetry No Asymmetry University Hospitals Type IV-B Type VI-B Type V-B Ambulatory Care

  20. Why Private Sector Participation: Pragmatism • Affordability - efficiency, access to capital, cost-transfer (off balance sheet) • Lack of government ‘skill-superiority’- i.e. not all areas are ‘core-skill’ areas • Increases role clarity & specificity of deliverables • Risk transfer e.g. financial, industrial relations, facility,technological obsolescence and service delivery risk

  21. Hospital Privatization : the evidence • Limited, but passionate, non-evidence based articulation • Overall international findings: not for profit = for profit private > public competition = a positive • Kaiser: preservation of ‘public goods’

  22. Purchasing: Increasingly tomorrow’s focus • The arguable nature of government purchaser’s ‘market power’ • The political discomfort of service and/or access rationing • Product heterogeneity vis a vis government skill and knowledge deficiencies • Consumerism & choice

  23. Conclusions : • From ‘Bevanite’ to role for government to targeted role • focus on information provision, regulation and financing; on provision • Incremental > programmed privatization • Private sector = broad church & there is no single solution

  24. “The only reliable way to arrive at an appropriate solution is to rely on what has worked in the past and adjust it to meet the specifics of each new or changing situation.” Van der Gaag

  25. “It is not the strongest species that survive, nor the most intelligent, but the ones most responsive to change.” Charles Darwin

  26. The changing role of the state

More Related