The effects of Fiscal Decentralisation on access to care and healthcare disparities: International evidence and the Italian experience

Lead Research Organisation: Queen Mary, University of London
Department Name: Blizard Institute of Cell and Molecular

Abstract

Introduction
Fiscal decentralisation consists in the transfer of pooling and spending responsibilities from the central government to lower levels of governance within a country. Health sector fiscal decentralisation (FDH) has been central in the health policy debate as an option to achieve national cost-efficiency. However, its effects on access to care and healthcare disparities remain largely unexplored.
Methods
This research employs a mixed methods approach consisting of a systematic literature review, a thematic policy analysis, and a panel data analysis. The aim is to evaluate the effect of FDH in diverse country contexts; to explore FDH policy process in Italy and to estimate its impact on multiple dimensions of access to care - i.e. availability, accessibility, and utilisation of care - and on healthcare inequities in Italian regions.
Results and discussion
Overall, the implementation of FDH has a detrimental effect on the quality and provision of care, as well as on pre-existing disparities in health and access. In Italy, FDH policies gradually replaced central pooling of revenues with local earmarked taxes to fund regional healthcare services. The shift is correlated to cuts on the supply side and to reduced utilisation of care at local levels. Additionally, FDH decreased accessibility to local healthcare services and expanded regional medical tourism, the effect being stronger for patients residing in poorer areas. Results suggest that in Italy FDH has facilitated national cost control strategies at the expenses of reduced access to care at local levels. The effect perpetuates existing inequities between northern and southern regions of the country.

Publications

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Studentship Projects

Project Reference Relationship Related To Start End Student Name
ES/P000703/1 01/10/2017 30/09/2027
1917473 Studentship ES/P000703/1 01/10/2017 30/06/2021 Arianna Rotulo
 
Description Fiscal Decentralisation is a vague term in the health policy literature. indeed there is no consensus regarding the pertinent financial responsibilities (pooling and/or spending) nor an agreement on their implication.

conceptual findings:
Fiscal decentralisation is a situation in which the responsibility for pooling healthcare revenues (that could be taxation or social insurance contributions) and the responsibility for spending healthcare resources are shifted from the central government to lower levels within a country. It is opposed to fiscal federalism, where only expenditure responsibilities are shifted to local authorities. To explain, the UK has implemented over years Fiscal Federalism, while Italy has implemented Fiscal Decentralisation.
A manuscript highlighting relevant findings is under review at the International Journal of Health Services.

Empirical findings #1
We carried out a systematic literature review of papers focusing on fiscal decentralisation in healthcare. As of today, a literature review on fiscal decentralisation in healthcare has never been performed. Our hypothesis is that fiscal decentralisation widens spatial health and healthcare inequities within a country.

1. We uncovered that the impact of fiscal decentralisation is mainly measured on infant mortality rate.
2. infant mortality rate, in most of the studies decreases at the national level
3. fiscal decentralisation widens the inequality gap between rich and poor regions: rich regions have better health outcomes related to fiscal decentralisation compared to poor regions. in some cases, fiscal decentralisation in poor regions has a negative or no effect on infant mortality rate.
the findings are in line with our hypothesis, suggesting that fiscal decentralisation as a policy option in healthcare services may be a regressive choice, as it widens the inequality gap between wealthier and poorer areas.

empirical findings #2

we are currently running a panel data analysis of 21 Italian regions to assess the impact of fiscal decentralisation policies (enacted in 2001) on access to healthcare services in Italy. our findings are as follows:
1. Italy has a strong north-south division in terms of per-capita GDP, the north being far more richer than the south
2. fiscal decentralisation policies have decreased the number of healthcare staff in the public sector but has increased the number of staff in the private sector;
3. overall, the number of doctors has increased. however, when we look at doctors in the public and private sector, we notice that the density of doctors employed by the public sector has decreased with fiscal decentralisation.
4. the total number of nurses has also decreased. however the number of nurses employed in the private sector has increased.
5. the number of technical resources (such as MRI machines, CT scanners, operating tables, etc.) has increased
6. the number of hospital beds both in the public and private sector, both ordinary and acute have significantly decreased with the implementation of fiscal decentralisation
7. the overall use of public health services (measured through discharge rates) has dropped with the introduction of fiscal decentralisation
8. increased patients' mobility: patients move to other regions to seek care
overall, our statistical analysis confirms that fiscal decentralisation is a cost-containing measure. Under such policy, public services invest in long-term resources - such as scans and operating tables - but cut their cost through a reduction of Human Resources. This translates into a situation in which hospitals lack the capacity to use their technical equipment, severely limiting access to certain types of services. Furthermore, under fiscal decentralisation hospitals tend to reduce the number of their beds, creating a long-lasting situation in which facilities always run at their full capacity. This in turn may limit the efficacy and quality of healthcare services, as well as the availability of services. finally, the increased rate of patients mobility towards richer regions suggests that fiscal decentralisation has created a two-tiered health system, creating geographical barriers to access for some of the Italian population.
Exploitation Route Fiscal Decentralisation is a topical policy option and a well-sought alternative to community empowerment. Health systems of many countries are increasingly adopting fiscal decentralisation reforms for their purported benefits in terms of efficiency. Little to nothing has been said about the effects of fiscal decentralisation on healthcare inequalities and inequities between richer and poorer areas of a country. The outcomes of this study aim to inform policy-makers about the potentially harming effects of fiscal decentralisation in healthcare. Having also in mind that healthcare decentralisation is gradually becoming a prominent topic in the curricula of global public health and policy-training programs we sincerely hope that our work is a timely and useful tool for public health students, researchers and policymakers.
Sectors Communities and Social Services/Policy,Education,Healthcare,Government, Democracy and Justice

 
Description present research is informing the debate and public opinion on healthcare decentralisation in Italy and UK.
First Year Of Impact 2019
Sector Communities and Social Services/Policy,Healthcare
Impact Types Societal,Economic,Policy & public services