Central reservation? Drawbacks of healthcare decentralisation in China

Does decentralisation improve public health services? Does devolution of power allow for effective mobilisation of community resources to meet local needs? Researchers from the UK's Institute of Development Studies and Liverpool School of Tropical Medicine studied the effects of health reform in a poor rural county in China.

They discovered that decentralisation has reduced funding levels and service quality and increased the use of non-medical personnel at township health centres. What implications does this have for other regions affected by the recent wave of decentralisation in healthcare?

The transition to a market economy in China has involved widespread decentralisation of government functions. There have been major changes in the organisation and financing of rural health services. Co-operative medical schemes have collapsed and many village health workers now operate as private practitioners. In poorer areas, the impact of under-funding and loss of skilled health professionals has been severe.

Health sector devolution was expected to improve funding for township health facilities. Health centres now receive their funding from township governments rather than county health bureaux, and townships are also responsible for the recruitment of health personnel.

The researchers conducted an in-depth case study of Donglan County, Guangxi Autonomous Region to discover the consequences of reform for township health centres. The main research findings were:

• Townships fail to invest in health services and have a restricted capacity to raise such funds through local taxation.
• The percentage of employees with health-related training fell from 78 percent in 1981 to 56 percent in 1994.
• There is a lack of skilled health sector managers at the township level.
• The county health bureau has lost the power to re-deploy personnel to redress local imbalances of skills.
• The number of outpatient visits per doctor and per staff member fell significantly in all facilities between 1986 and 1994.
• User groups complain of a decline in the quality of healthcare and a lack of 'good doctors'. Many patients turn to other health providers or visit pharmacies to buy medicines directly, rather than using local health centres.
• Health centre equipment and buildings are poorly maintained, reducing the ability to provide effective diagnosis and treatment.

The lessons for health policy-makers from this case study are:

• Local realities must be taken into account when developing decentralisation policies.
• Devolution of control is of questionable value if the local authority has restricted ability to generate revenue through taxation.
• Rapid decentralisation is likely to fail if weaknesses in the management capacity of local government are not addressed.

Source(s):
'Decentralising rural health services: a case study in China' by Shenglan Tang and Gerald Bloom, International Journal of Health Planning and Management 15 (2000)

Funded by: World Bank; International Development Research Centre (IDRC), Canada; UK Department for International Development

id21 Research Highlight: 1 June 2001

Further Information:
Shenglan Tang
International Health Division
Liverpool School of Tropical Medicine
Pembroke Place
Liverpool L3 5QA
UK

Tel: +44 (0)151 708 9393
Fax: +44 (0)151 708 8733
Contact the contributor: stang@liv.ac.uk

Liverpool School of Tropical Medicine (LSTM), UK

Gerald Bloom
Institute of Development Studies
at the University of Sussex
Brighton
BN1 9RE
UK

Tel: +44 (0)1273 606261
Fax: +44 (0)1273 621202
Contact the contributor: g.bloom@ids.ac.uk

Institute of Development Studies (IDS), UK

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Look at the Management Systems for Health new electronic resource centre.

See this issue of the Bulletin of the WHO on health systems.