1

DESCENTRALIZATION AND HEALTH POLICY IN SPAIN Antón Losada

Paper for ECPR 2001 Grenoble Departamento de CC Política e da Administración

Facultade de Ciencias Políticas

Campus Universitario Sur

15782. Santiago de Compostela

Spain-España

teléfono 34 981 56 31 00

Fax 34 981 59 69 51

alosi@usc.es

Health policy has been highly decentralised in Spain during the last 15 years. Today

Andalusia, Catalonia, Galicia and the Bask country have their own regional health systems.

These regional services have implemented very different strategies and policies for

reforming the management of the health system. New instruments and solutions have been

implemented: the split between providers and buyers, introduction of internal markets,

implementation of new forms of organizations like foundations, private management of

public hospitals and so on.

These new policies and solutions have produced new models, ideas and solutions for

the public debate over health policy in Spain. Also, the decentralization process has

produced some kind of competition for resources and results between the regional

governments. Other important impact has been the creation of models for a demand for

change in the Spanish health system, in order to get the results and improvings apparently

provided by these new regional systems and policies.

The paper will evaluate if there are real differences of results and real differences in

terms of change and policies between this new regional services. Also the paper will assess

their impact and the real degree of improvement from the point of view of the consumers.

Also, the paper will consider the impact of this process of decentralization upon the specific

results and the concrete policies implemented by the different administrations. The paper

will try to get some answers for two very specific questions:

1. Are consumers better off after a process of intense decentralization of health policy?

2. Competition for resources and implementation of new policies are inherent

consequences of this process of decentralization of decision and management?

Health policies in Spain have experimented a period of rapid change and

transformation between 1980 and 2000. The main concern of this paper is to make a

description of such a process. We will try to explain it considering two main variables:

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a) Intentions, priorities and strategies of three main actors: professional, bureaucrats

and politicians wanted and fight for a change and for this concrete type of change.

b) The developing and consolidation of a totally new institutional setting. The Estado

de las Autonomías has created the opportunity for this change and, also, has had a

significant impact upon the type, timing and directions of changes.

1. PUBLIC HEALTH IN SPAIN: POLICIES AND ACTORS TROUGH TIME

A series of social security laws introduced, between 1962 and 1972, three main

changes in the very limited and residual public coverage of individual health care initiated

in 1940s, after the civil war:

1. Inclusion of health care in the social security system.

2. A significant increase in terms of public coverage.

3. The creation of a large network of public hospitals committed to provide public

heath care.

Health bureaucracy and professional mainly supported these changes. Economic

expansion and the need of Franco's regime to produce some kind of answer to the

increasing opposition create the opportunity to change traditional policies (Rico 1996).

The process of democratisation in Spain is also the process of extension and

consolidation of health as a universal right and as a public service. In 1978 four

administrative organizations are created in order to develop and extend a variety of health

and social service:

- INSS: to manage and develop a universal Social security system.

- INSALUD: to manage health services

- INEM: To manage and develop employment policies

- INSERSO: to manage and develop specific policies for old people.

These four organizations, heavily centralised and bureaucratised are responsible for the

massive extension and consolidation of the very limited social and health policies

developed till then by the Spanish state.

Following strategies and models taken for the British NHS, this four organizations

developed between 1980 and 1990 very big budgets and ambitious policies all over the

country and for all Spanish people: Nowadays the health coverage ratio is 99.79, but just in

1945, the heath coverage ratio was 22.06% of the population. In 1989 the right to have

health assistance become a universal right protected by law.

The following tables show some data about the actual state of health policy in Spain.

Specially referring to finance, resources and objectives.

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Table 1: HEALTH IN SPAIN: SOME INDICATORS (Source: MSC 1995)

LIFE EXPECTANCY INFANT MORTALITY

ANDALUCIA 76.0 7.7

CANARIAS 76.0 5.6

CATALUNYA 77.3 6.4

GALICIA 76.6 8.9

NAVARRA 78.1 8.1

BASK COUNTRY 77.2 6.7

VALENCIA 76.3 7.2

ESPAÑA 76.9 7.1

Table 2: HEALTH ASSISTANCE COVERAGE IN SPAIN (Source: ENS 1993)

Social security 94.7

Social security and Mutuas 2.4

Private insurance and Mutuas 2.1

Private insurance 6.3

Working Insurance 1.3

Charity 0.2

Private professionals 0.4

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Table 3: HEALTH FINANCING IN SPAIN (Source: Gest 1997)

YEAR STATE % SOCIAL SECURITY % OTHERS %

1986 23.8 74.3 1.9

1988 25.2 69.6 5.2

1990 68.8 27.2 4.0

1992 69.0 27.2 3.8

1994 70.2 27.1 2.7

1996 82.8 15.1 2.1

1997 91.9 6.0 2.1

Table 4: HEALTH SPENDING DISTRIBUTION IN SPAIN 1982-1995 (Source: Oficina de economía de las salud 1995)

YEAR GENERAL MEDICINE

AND PHARMACY

SPECIALISED

MEDICICE

OTHERS

1982 40.7 54.8 4.5

1985 39.6 55.5 4.9

1990 35.6 61.0 3.4

1994 33.2 61.7 5.1

1995 34.8 6.0 5.2

In 1981 health policies are split from working and labour policies. During its first years

in office, the socialist government begun a process of health care reform with five main

objectives:

1. The separation of heath care form social security

2. Financing of health services trough general taxation

3. Introduction of universal health coverage

4. Unification of the confuse network of public providers and regulation of the private

sector

5. Enactment of the basic state regulation and the institutional framework for

decentralization.

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In 1986 Spanish parliament passes the Health General Law. This law was the result of a

very hard process of negotiation and conflict between those who wanted to universalise

heath right as faster as possible -left wing parties, trade unions, left wing of Socialist

government, professionals- and those who were more concern with the cost of such a

process -right wing parties, nationalist parties, right wing of socialist government, health

bureaucracies-.

The main consequence of such a conflict was a very incremental and adaptative process

of implementation of health policies. In fact, 1986 can be considered the beginning of the

implementation of the health care reform. In a context of economic expansion and public

expenditure growth, significant progress was made in terms of

- Finance through general taxation

- Recreation and modernization of public hospitals and new health facilities

- Decentralization

During this decade begun a process of progressive decentralization of Health services

and management from the central state to the most significant regions:

- 1984: transfer of health policy and management to Andalusia

- 1987: transfer to health policy and management Bask country and Valencia

- 1990: transfer to health policy and management Navarre and Galicia

The timing of this process must be explained in term of two key variables:

1. Political factors: some regions like Andalusia wanted the decentralization process

done as soon as possible as a part of a global strategy in order to solve some

problems of identity or public perceptions about its utility as institutions.

2. Policy factors: other regions like Catalonia, bask Country or Galicia do not have

such a problem of identity or public perception. They prefer to negotiate carefully

the exact terms and conditions of the process, specially the financial aspects.

The beginning of 1990´s was also the beginning of a new wave of reforms. In a new

context of economic crises and public expenditure control and under a clear influence by

the models and ideas introduced by the Catalan Law of heath care Reform (1990), the main

objectives of this reform were:

1. Introduction of internal markets and new management

2. Separation of financing and provision through contract-programme

3. A more relevant and complementary role for private provision

4. Control of public expenditure

In 1996 the Spanish major right wing party, PP, won general elections with a

programme of reforms based on the ideas of liberalization, privatisation, reductions of

public spending and bureaucracy.

This political fact and the pressure put upon Spanish economy and Spanish public

sector by the European Union to meet the requirements economic integration have put even

more pressure upon this process of reforms, mainly in terms of:

- Privatisation of public facilities.

- Introduction of new management formula like contracting out, co-production and

co-payment of individual health care services.

The following table summarised this process of change and transformation. The table

tries to show which was the reference paradigm at every time, the type of policy

implemented and who were the main actors, -supporters and opposers-.

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Table 5 EVOLUTION OF PUBLIC HEALTH AS A PUBLIC PROBLEM IN SPAIN (Source: author)

Transition to

democracy

(1974-1982)

Socialist Decade

First half

(1982-1986)

Socialist Decade

Second half

(1987-1995)

First Popular

Government

(1996-2000)

Dominant

Paradigm

Universal right

Public provision

(NHS)

Universal right

Public provision

(NHS)

Vs.

Tachterisme

Mixed provision

Introduction of

internal markets

Management

Mixed provision

Introduction of

internal markets

Management

Privatisation

Supporters

Health

Bureaucracy

Health

Professionals

Health

Bureaucracy

Health

Professionals

Public opinion

Professionals

Moderate

nationalists

(CIU, PNV)

Private providers

Regional policy

communities

Moderate

nationalists

(CIU, PNV)

Private providers

Opposition

- conservative

parties

- left parties

-trade unions

-conservative

parties

-medical elites

-Private providers

relative:

-conservative

parties

-health bureaucracy

Strong

- Trade unions

-public opinion

Relative:

-left parties

- Trade unions

-public opinion

Position

of the party in

office

UCD:

Internal

fragmentation

PSOE

Tension between

economic and

health responsables

PSOE

Political

turbulences

Increasing claim

for reform

PP

Internal Tension

liberals/

reformers/

conservatives

Degree of

decentralization

Low High

Strong influence of

Catalan nationalist

party (CIU)

High

Strong regional

regulation activity

Catalan Law

High

Strong regional

innovation

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Resoults No reform

Health policy as a

autonomous policy

Universal right

Financing trough

taxes

Decentralization

Partial reform:

Abril report

Introduction of

personal payment

"Contrato-

programa"

Internal markets

Co-payment

More private

providers

Changing policies

2. A NEW INSTITUTIONAL SETTING: EL ESTADO DE LAS AUTONOMÍAS.

The so call “Estado de las Autonomías” is based on the idea of “Autonomy” as

regular form of relation between central Spanish government and the regions, but also as

“Autonomía” as a institutional setting for the regions to develop. The system implies very

important levels of self-government and decentralization. Main powers of autonomic

institutions (CCAA) and Central State are distributed into three different levels:

-Powers exclusive to the Autonomous Communities (AC): institutional

organization, territorial organization, urban policies, health, fishing in domestic waters,

education, culture, etc.

-Shared powers: the State determines the bases for these powers and the

Autonomous Communities then legislatively assume and execute them. I.e. development

and planning of economic activity, industry, agriculture, corporate credit institutions and

savings and loans (cajas de ahorros), etc.

-Powers expressly reserved for the central state: international relations, defence,

foreign commerce, the monetary system, etc.

The institutional model for Autonomous Communityi (A.C.) most extended is

composed of a Legislative Assembly that includes, a Governing Council that directs the

Administration, and a High Court of Justice integrated into the general organization of the

State Justice Administration. The Parliament selects from among its members the President

of the Community, who in turn names and presides over the Governing Council.

Bask Country and Navarra have significant differences with the rest of the Spanish

regions in terms of their relationship with central government. Both regions have the

maximum level of autonomy. The main difference is that both regions manage their own

fiscal system and fiscal administration.

From this institutional perspective, and after these first stages of development and

popular satisfaction for self-government recovery in regions like Galicia or Catalonia,

“Autonomía” face an increasing problem of public perception about levels of regional

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performance. A problem that it is a part of a major question: how to secure its institutional

consolidation?

There are few sources of information about levels of public satisfaction about

institutional performance. There are a lot of electoral surveys at the media, and also a lot of

public debate, but the real thing is an absence of enough information about what we call “El

Estado de las Autonomías”. Working from the perspective of Public Policy Analysis, we

note the work of a group of researchers from several Spanish universities (a team that it is

called ERA). First ERA report was published in 1997. Public perceptions about

“Autonomías” present the following main characteristics (ERA 1997):

The Autonomous Communities (AC) have became key actors in the Spanish

political life. One third of the Spanish GNP depends and relies on regional

decisions, regional politics and regional policies. AC are also key actor in terms of

management and implementation of public policies in Spain. Regional governments

and regional elites are relevant actors not only at regional levels. They also play a

very active role at Spanish and European levels. In other words, AC in Spain have

real power and real resources and they know how to use them. This does not mean

that public opinion must be unanimous about the level of success or failure of each

region or even the overall system.

The process of development and consolidation of the model of the Estado de las

Autonomías has not been an easy one. Conflicts and tensions between Spanish

governments, regional governments, local governments and Europe are frequent.

This type of conflicts can be considered a part, or even, a product of the system.

These conflicts have relevant effects on the ways public policies are formulated,

decided and implemented in Spain. These conflicts also have very significant

impacts on public perceptions about institutional performance and political

legitimacy of each of those levels of governance. These impacts are plural and have

several directions in each case, in each policy problem, in each moment of time and

in each region.

The Autonomous Communities are nowadays consolidated as institutions. There are

differences between regions, but in all of them, regional actors, elites, governments,

parliaments and administrations have become critical in terms of public policy

options and implementation, allocation of resources and economic, social and

political performance.

The Autonomous Communities have achieved a high degree of social acceptation

and legitimacy in terms of public perceptions. This very positive perception is also

true talking about the perceptions of social, economics or political elites. AC are

seen as good instruments for solving historical o identity problems, political

problems and policy problems. It is possible to talk about a general demand for even

more autonomy and decentralization in all regions. On the other side, there is also a

clear perception that El Estrada de lass Autonomies have created new problems and

challenges for the Spanish society.

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Autonomous Communities are also administration and organization. This is one of

the most controversial results of the decentralization process in Spain. On one side,

Autonomous administrations have provided better information and services for the

citizen. But on the other side, these regional administrations are seen or presented

frequently as symbols for all the problems of coordination, mismanagement,

increasing of public spending and inefficiency that the model has produced.

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3. REGIONAL HEALTH POLICIES IN SPAIN: A COMPARATIVE ANALYSIS

The Following tables 6-7 summarised two key elements of the new Spanish Health

system:

- Decentralization has provided a variety of administrative and organizative solutions.

- Competition for resources between regions has been a key variable in the expansion

of public health policies and also for the developing of new models of management

and administration inr order to:

o Maximimice efficiency and efficacy

o Improve institutional legitimacy.

Table 6 DESCENTRALIZATION OF HEALTH ADMINISTRATION IN SPAIN

(Source: author) MAME DIMENSION NATURE COMPETENCES

INSALUD National: Spain Public

Administration

Management of Social

Security

Design of health policies

and

management of Public

health services in regions

not decentralised

SAS Regional: Andalusia

Autonomous

administrative

organization

Health policy

Management of public

health services

SCS Regional: Canarias Autonomous

administrative

organization

Health policy

Management of public

health services

SCS Regional: Catalonia Public

Administration

Health policy

ICS Regional: Catalonia Autonomous

management

organization

Management of Public

health services

And

Social security

SERGAS Regional: Galicia Autonomous

administrative

organization

Health policy

Management of public

health services

OSASUNBIDEA Regional: Navarra Autonomous

administrative

organization

Health policy

Management of public

health services

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OSAKIDETZA Regional: Bask Country Private organization

under public control

Health policy

Management of public

health services

SVS Regional: Valencia Public

Administration

Health policy

Management of public

health services

Table 7 DISTRIBUTIONS OF RESOURCES BETWEEN REGIONS IN THE NEW

HEALTH FINNANCING MODEL (1998-2001)

Source: (Argenté y Alvarez 1998)

GENERAL

FUNDS %

ASSIGNED FUNDS

%

TOTAL

RESOURCES %

ANDALUCIA 18.07 18.04 18.07

CANARIAS 4.07 1.61 4.02

CATALUNYA 15.75 45.09 16.27

GALICIA 6.91 7.73 6.93

NAVARRA 1.34 1.42 1.35

BASK

COUNTRY

5.45 5.17 5.44

VALENCIA 10.23 4.85 10.13

Total Services

transferred

61.82 83.91 62.21

Rest of Spain

INSALUD

38.18 16.09 37.79

TOTAL NHS 100 100 100

Change and innovation have been intenser during the nineties. The descentralization

process, the increasing activity of regional health policy communities and the clear

perception between regional politicians about the importance of health policies for the

consolidation of regional governments have created the opportunity for it:

1. Regional governments have become key institutional actors in terms of legal control

of resources and political direction of health policies.

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2. Regional policy communities have developed new solutions and new policies for

regional politicians that needed them on order to prove (i) regional governments are

better managers than central governements, and (ii) health policies are improving

under regional direction. This new policies are very different from one region to

another, but there are some common basis:

a. Introduction of internal markets

b. Split between providers and buyers

c. Increasing spending in health policies, specially in terms of infrastructures

and human resources

d. Specif policies oriented to increase and improve the primary atention

system.

3. Health profesionals are playing a relevant role not only in terms of provision of

health services, but also in terms of management and political direction. It is not

unsual to find health profesionals managing hospitals, playing leading roles in

political parties or even as members of regional governments.

4. Private health systems and services are percieved by spanish people as a

complement of the public system. 80% of spanish health spending is public

spending and only 1.19% of GNP is devoted to private health.

The following table 8 and figure 1 show how the different health regional systems

are moving from the classic public, centralised model of public health provision and

financing towards other solutions and combinations with different degrees of itnroduction

of internal markets, split between providers an buyers or even the domminance of forms of

private provision as the final objective for the process of descentralziation and change in

some regions.

This process of change and innovation is not a homogeneous or pacific one. Many

times is nor easy to have reliable official data and many times is not easy to separate

information from propaganda, but two main characteristics seem to be present:

1. Try and experimentation seems to go faster for the provision question than for the

financing question

2. There is a common trend going from public provision solutions to private provision

solutions. There are differences in terms of intensity and speed but not in terms of

direction of change.

TABLE 8 CHARACTERISTICS OF REGIONAL HEALTH SYSTEMS IN SPAIN

(Source. Author)

REGION CHARACTERISTICS OF THE

SYSTEM

ANDALUSIA Public finance

Public provision

Central planning and systematic evaluation

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BASK COUNTRY Public finance

Evolution from public provision towards

New Public management

Split between providers and buyers

NAVARRA

Public finance

Public provision and New Public

Management

Transformation of traditional private

provider into public providers

Transformation of all workers in public

servants

GALICIA

Public finance

Public provision

New Public management

Evolution of public providers towards

private providers: foundations, MEDTEC

Creation of private providers

CATALUNYA

Public finance

Private providers

Introduction of internal markets

Split between planning and provision

VALENCIA

Public finance

Substitution of public providers Private

providers

"Renting" of public health services to

monopolistic private providers

Competition between public and private

providers

INSALUD

Public finance

Public provision

New Public Management

"Contrato Programa"

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Figure 1 HEALTH POLICIES IN SPAIN: A COMPARATION Source: author

PUBLIC Andalusia

FINANCE INSALUD

Galicia Euskadi Navarra

Catalonia

Valencia

PRIVATE

FINANCE

PRIVATE PUBLIC

PROVISION PROVISION

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As a concrete example of this variety of solutions between regional systems, the

following table 9 summarised how different regions organise the contracting of services

and how these different forms of contracting provide different combinations of public and

private management.

Table 9 MOST EXTENDED MODELS OF CONTRACTING IN SPANISH HEALTH

SYSTEM (Source: author, adapting Fernández 1996)

TYPE OF CONTRACT CARACTHERISTICS EXAMPLE

Contrato-programa -negotiation of objectives

for management and

financing

-results have impact on

managers continuity

INSALUD

Contrato-programa by

incentives

-negotiation of objectives

for management and

financing

-Incentives by results for

managers, professional,

workers..

SAS

Contrato-programa by

partial-risk

-Public finance

-negotiation of terms and

conditions for service,

labour, etc…

Contracting with Public

enterprises

Contracting out -agreement between parts Contracting of catering,

cleaning, etc.

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4. CONCLUSIONS

There have been three main trends all along the process of change in recent Spanish

health policies

1. A fast an extensive process of so called "health devolution" towards the regions

2. A transfer of increasing control of services to health professionals and managers,

but also more direct control by users and clients.

3. The search for new management, new resources for it and quality as an objective.

Table 10: HEALTH PUBLIC POLICY IN SPAIN: TRENDS OF CHANGE (source. Author)

BEFORE 1985 AFTER 1985

FINNANCE Public Public

Co-payment

PROVISION Public

National heath service

Public and contracting-out

Regional health services

Split between providers and

buyers

Internal markets

MANAGEMENT Public Introduction of private

management techniques

Private management

SERVICE PRIORITIES Specialized assistance

Quantity

Primary assistance

Quality

ROLE FOR PRIVATE

HEALTH

Marginal Complementary

MAIN ACTORS Professionals

Trade unions

Spanish politicians

Professionals

Regional politicians

Clients

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It is not easy to talk about results and even harder to evaluate them. Reliable data

are not enough. The decentralization process has been very Sometimes it is not easy to

separate real data and information from propaganda coming from regional governments.

But we can identify three main trends in terms of results

- Data of management and service quality are variable. There are

significant differences between regional systems, but also there are very

relevant differences inside each regional system. We can account for

relatively successful experiences of privatisation or introduction of internal

markets in Galicia, Catalonia or Euskadi, but also there are very relevant

failures of these solutions inside each of these regions. On the other side,

there are very successful experiences of totally public management in

Navarra or Andalusia.

- There are significant improving all over the country in terms of public

opinion and client's perception about quality and liability of public health

services in Spain (See table 10). This perception seems to be also true in

terms of quality measures of perceptions. In a much more recent study

(2000) made using a focus groups approach -distributed by- regions, there

was a general consensus that AC have contributed to improve the quality of

public services. Some data seem to be relevant referring to perceptions of

the people about the impact of decentralization for public health services:

i. There was a positive consensus in the groups from Andalusia,

Asturias, Canarias, Castilla-la Mancha, Extremadura, Navarra, Bask

Country; mainly regions where regions manage public health

services but they are doing so mainly through public provision

models.

ii. There was a negative consensus in the groups from Baleares,

Castilla-León, Aragón and specially Madrid; mainly regions where

Central State still manage public health services.

iii. There was no consensus about Health public services quality in

Catalonia, Valencia, Galicia; mainly regions where regions manage

public health services but they are doing so mainly through the

introductions of private management techniques, privatisations and

introductions of internal markets.

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Table 11 SATISFACTION WITH SPANISH HEALTH SYSTEM (Source: MSC 1994)

Positive

perception

Information

(1-7)

General

medicine

Specialised

medicine

Hospitals

Andalusia 44.9 3.5 5.2 4.7 5.2

Aragon 68.6 4.3 5.7 5.2 5.5

Canarias 53.0 3.2 5.3 4.7 5.4

Castilla-

León

66.1 4.4 5.7 5.3 5.7

Catalonia 55.8 3.4 5.0 4.8 5.2

Galicia 47.1 3.6 5.3 4.7 5.5

Navarra 67.9 4.1 5.7 5.1 5.7

Bask

Country

69.0 4.1 5.5 5.1 5.4

Valencia 51.7 3.7 5.3 4.6 5.2

Spain 58.1 3.8 5.4 4.9 5.3

- Competition for resources between regions and political competition inside

regions are key variables for explaining this process. Public health improve

in Spain cannot be explained without this dynamics of regional

competition. Also this institutional dimension is a key variable to explain

the increasing level of resources assigned to health problems and policies

and to explain the increasing public relevant of public heath questions for

public policy debate and political competition.

- The plurality of models and solutions adopted by the different regional

services, along with what we can call “public health devolution” has been

a key element for a massive extension of advanced health services and

care all over Spain.

- Also there is possible to talk about some kind of a so call “Spanish public

health market” with high degrees of competition for resources, results

and satisfaction of clients between different regional services and

models. In fact a new phenomena is taking place more frequently: Spanish

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people vote with their feet wherever they can. They move from one regional

public health system to another, especially if they live along regional

borders. Some examples of these phenomena are the transfer of public health

clients from Aragón to Catalonia and Navarra, from Santander to the Bask

Country, from Murcia to Andalusia. These phenomena even take a European

dimension: it is also frequent some transfer of public health clients from the

north of Portugal to Galicia.

- Also it is possible to identify in the Spanish public opinion an increasing

use of information coming from the different experiences and solutions

implemented in the regions. In fact, it is very common to use ideas, models

and solutions developed in other region as referents, demands or threats for

the health debate of another region. In other words, the people of one region

take advantage and knowledge from the experiences of other regions. This

knowledge comes from official results and data, but also -even mainly- from

other more informal sources like personal or experiences.

In other words. After decentralization of public health policies and services, Spanish

people know, care and demand much more. Results in terms of efficiency, efficacy and

quality are still open questions. Regional Governments say they are on the way, people are

not so confident.

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i For a more detailed explanation of the institutional model of Galicia and its functioning,

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Xerais, Vigo. 1994.