• Recommended reading

Recommended reading

This summary was produced by id21.

Under the command economy all government health workers in China earned similar salaries. Twenty years of transition to a socialist market economy, including liberalisation of the labour market, has led to growing income differences. An Institute of Development Studies working paper explores how this has affected health workers. The study suggests that the government needs to establish new payment systems and a regulatory framework that encourages health workers to provide effective and affordable health services while enabling them to earn a reasonable income.

China’s economic reforms have resulted in growing income differences between residents in rich and poor provinces, and between employees of profitable and unprofitable enterprises. Maintaining uniform pay levels for health workers, particularly in the face of radical devolution of its own financial management, has been almost impossible for the government. Individual facilities can pay bonuses from revenues generated from user charges and drug sales and so employees in more successful facilities earn far more than colleagues working in less well endowed facilities or in poorer regions. How should health workers be paid? How should their performance be measured? This paper explores these questions in the context of growing differences in earnings between China’s health workers, and increasing cost of medical care.

Research findings include:

• Personnel in successful medical facilities earn more than colleagues in the less well endowed facilities.
• Health facilities in poor localities often pay less than the basic government salary.
• Health workers increasingly resort to informal methods of earning an income - doctors commonly accept cash gifts from patients, although the government considers this to be unprofessional.
• Some doctors accept ‘kickbacks’ from drug suppliers or facilities seeking referral patients despite this practice being a criminal offence.
• The strategies that health facilities have employed to adjust to rapid economic and institutional changes have led them to shift from prevention to an increasingly costly style of medical care.

Policy implications include the need to:

• devise payment systems that permit health workers to earn a reasonable income, whilst encouraging them to provide effective and affordable health services
• establish a regulatory framework that gives clear guidance to health workers on what is considered to be ethical behaviour
• understand that relationships between health workers, governments, and CSOs are likely to change considerably in China and other low and middle-income countries over the next few years.

• Full text of document
• Publisher details
• Send to a friend