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Organizational Barriers and Equity: Lessons from Decentralization in LAC. Daniel Maceira, Ph.D. [email protected] Center for the Studies of State and Society Buenos Aires, Argentina. LAC Context During the ’80s and ’90s. Highly Volatile Economies,

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organizational barriers and equity lessons from decentralization in lac

Organizational Barriers and Equity:Lessons from Decentralization in LAC

Daniel Maceira, Ph.D.

[email protected]

Center for the Studies of State and Society

Buenos Aires, Argentina

lac context during the 80s and 90s
LAC Context During the ’80s and ’90s
  • Highly Volatile Economies,
  • Profound Gaps in Income Distribution,
  • Implementation of Macroeconomic Adjustment Policies with Negative Effects on Social Sectors (Education and Health),
  • Social Sectors have been subject to a Series of Reforms. Goals: Achieve Social Objectives s.t. Financial Restrictions (WDR93).
political economy of health care reforms
Political Economy of Health Care Reforms

Political Level

Executive Power

  • Ministry of Health
  • Ministry of Finance

Congress

Local Governments

Multilateral Organizations

International Donors

Social Security Institutions

Private Health Care Plans

Health Providers´ Chambers

Physicians´ Prof. Organizations

Health Care Workers

Drugs & Input Producers

Patients

Consumers´ Associations

Goals

Strategies

Actions

Beliefs

International Level

Sectoral Level

framework organizational barriers
Framework: Organizational Barriers
  • Reforms trigger Changes in the Structure of the Sector.
  • Policy Markers should select clear Goals to contrast them against others´Action Plans, identifying potential Partners & designing Mechanisms to align Interests.
  • Decentralization requires:
    • Willingness to Distribute Political & Financial Power.
    • Strong Investments in Management and Social Control at the Local Level.
  • Any reform should forsee a complete Action Plan considering:
    • Spillovers over other sub-sectors (private, social insurance)
    • Cross subsidies to avoid increasing equity gaps.
  • History Matters (federalisms, socialisms, authoritarisms).
bolivia
Bolivia
  • Structural Reform + Health Care Strategy (Maternal&Child Insurance)
  • Law of Municipalities (´85)/ Popular Participation Law (´94):
    • Coparticipation Funds: New rules of Distribution, based on Population at Departament Level.
    • Popular Election of Municipal Authorities.
    • Decentralization of Resources (Broken production function).
    • Social Control (Popular M&E Commitees).
  • Actors:
    • “Neoliberal” reforms (Sanchez de Lozada)
    • New economic and political Stakeholders,
      • Municipalities vs. Departments (Santa Cruz – Tarija),
      • Declining Union´s Political Power (post 1985)
      • Strong influence of Intl. Donors and Multilateral Organizations.
  • Results:
    • HC Coverage Increased,
    • Strong non-planned Subsidies,
    • Empowerment of Local Leaders,
    • Weak effects on equity gap in resource allocation.
slide8

100%

90%

80%

70%

60%

%Population

%Co-participation, cumulated

50%

%Own Resources, cumulated

%Foreign Aid, cumulated

40%

30%

20%

10%

0%

1st

2nd

3rd

4th

5th

Distribution of Resources, by quintile of UBN

and by Source

decentralization in bolivia some conclusions
Decentralization in Bolivia: Some Conclusions
  • Administrative/Managerial expertise of major political parties are significant “Quality Shifters” in some Public Policy Outcomes.
  • Urbanity proves to be a relevant issue when planning Health Care Strategies.
  • Financial Resources, as proxy of Decentralization Commitment have a significant, positive and similar effect on Social Outcomes.
  • Local Managerial Capacity has significant and similar effect on Health and Education Outcomes.
  • Community-type variables do not show influence on Social Sectors´Results.
argentina
Argentina
  • Federalism + Decentralization (late ´80s).
  • Provintial Authorities kept ownership & control of Health Care Resources (human, fiscal, & infrastructure), defining own Public Health Strategies.
  • COFESA: Federal Health Council – Deliverative Body with no enforcement power.
  • 60% of Population covered by Transversal Social Health Insurance Plans.
    • Main Social Security Institution: PAMI (Public insurance for edlery),
    • Unions and Provintial Public Bureaucracies control circa 50% of formal health coverage, divided into 300 social funds:
      • Fragmentation of resources – weak risk pooling mechanisms.
      • Limited solidarity among funds.
      • Provision of care is mainly contracted to Private Providers (no VI financing-provision of care).
  • Therefore:
    • Limited capacity of National Ministry of Health to align interests,
    • Results:
      • Increasing financial gaps in HC among provinces,
      • Inefficiency in Resource Allocation,
      • Crisis 2002: Alignment of National and Provintial Goals helped to support partial reforms (Remediar, Law of Generics) .
out of pocket in health care by component in by household income quintiles indec egh98
Out-of-pocket in Health Care, by Component (in %), By Household Income Quintiles (Indec-EGH98)

Health Care Expenditures %

15

7.5

Total

Health Care Services +

Private Insurance

Pharmaceuticals

Q1

Q2

Q3

Q4

Q5

0

1794

190

3204

Household Income

general policy implementation issues
General Policy Implementation Issues
  • Scarce Empirical Literature on Decentralization in LAC.
  • Lack of M&E Mechanisms affects Documentation of Results.
  • Limited Institutional Capacity at Public Level provokes Organizational Constraints in Policy Implementation.
  • National Governments do not coordinate Health Care Strategies with Governors and Municipal Authorities.
  • Rules/Reforms´Main Actions are defined by Actors with strong bargaining power, implying:
    • Financial and Epidemiological Risk Transfers,
    • Poor Equity Indicators, leading to inefficient allocation of resources,
    • High Transaction (administrative, bargaining) Costs,
    • Poorly Effective Reforms,
    • Lack of Sustainable M&E Tools to improve feedback and Sound Advocacy Agenda.
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