On a hiding to nothing? Assessing the corporate governance of hospital and health services in New Zealand 1993-1998

Corporate governance in Czech hospitals after the transformation

BACKGROUND

This contribution is a response to the current issue of corporate governance in hospitals in the Czech Republic, which draw a significant portion of funds from public health insurance. This not only has a significant impact on the economic efficiency of hospitals, but ultimately affects the whole system of healthcare provision in the Czech Republic. Therefore, the effectiveness of the corporate governance of hospitals might affect the fiscal stability of the health system and, indirectly, health policy for the whole country.

OBJECTIVES

The main objective of this paper is to evaluate the success of the transformation in connection with the performance of corporate governance in hospitals in the Czech Republic. Specifically, there was an examination of the management differences in various types of hospitals, which differed in their ownership structure and legal form.

METHODOLOGY/APPROACH

A sample of 100 hospitals was investigated in 2009, i.e., immediately after the transformation had been completed, and then three years later in 2012. With regard to the different public support of individual hospitals, the operating subsidies were removed from the economic results of the corporations in the sample. The adjusted economic results were first of all examined in relationship to the type of hospital (according to owner and legal form), and then in relation to its size, the size of the supervisory board and the education level of the senior hospital manager. A multiple median regression was used for the evaluation.

FINDINGS

One of the basic findings was the fact that the hospital's legal form had no influence on economic results. Successful management in the form of adjusted economic results is only associated with the private type of facility ownership. From the perspective of our concept of corporate governance other factors were under observation: the size of the hospital, the size of the supervisory board and the medical qualifications of the senior manager had no statistically verifiable influence on the efficiency of the hospital management, though we did record certain developments as a result of the transformation process. The economic results that were reported were significantly distorted by the operating subsidies from the founder.

PRACTICAL IMPLICATIONS

The results can be used immediately on several practical levels: on the macro level as part of the state's formulation of health policy, particularly in the optimization of the structure of healthcare providers, as well as for the completion of reforms in legal forms and hospital founders, and on the micro level as part of the effective administration and governance of hospitals through corporate governance regardless of the form of ownership.

Review of the corporate and healthcare governance literature

The governance and effectiveness of the healthcare sector is paramount due to its impact on human well-being and the size of this sector of the economy. Astute governments and healthcare boards need to know how to improve the governance of the sector. Therefore, this review draws together the theoretical and empirical literature from both the corporate and healthcare governance literature to determine the state of knowledge that can confidently guide those who either perform board roles as directors or who create governance structures. It concludes by suggesting that further theoretical work and research are necessary, and that the focus of both needs to be broader to take into account the complexity of the sector.

Review of the corporate and healthcare governance literature

The governance and effectiveness of the healthcare sector is paramount due to its impact on human well-being and the size of this sector of the economy. Astute governments and healthcare boards need to know how to improve the governance of the sector. Therefore, this review draws together the theoretical and empirical literature from both the corporate and healthcare governance literature to determine the state of knowledge that can confidently guide those who either perform board roles as directors or who create governance structures. It concludes by suggesting that further theoretical work and research are necessary, and that the focus of both needs to be broader to take into account the complexity of the sector.

Decentralizing resource allocation: early experiences with district health boards in New Zealand

OBJECTIVES

In New Zealand in 2001, a system of purchasing health services by a centralized purchasing agency was replaced by 21 district health boards (DHBs) which are responsible for both providing health services directly and for purchasing services from non-government providers. This paper describes the processes associated with the allocation of health resources in the decentralized system and considers the extent to which four of the government's stated objectives are likely to be achieved.

METHODS

Two rounds of interviews with national stakeholders and senior DHB personnel plus case studies in five districts which included key informant interviews, observation at board meetings and document analysis.

RESULTS

The re-structuring of the health sector in New Zealand appears to have simultaneously enhanced and inhibited the achievement of government objectives. Local decision-making has encouraged greater local responsiveness and new funding arrangements have allayed concerns about inter-regional equity. The system is less commercially oriented than it was during the 1990s and collaboration between DHBs is improving. However, the combination of increased integration of purchasing and provision within DHBs and the focus on financial deficits in the early years appears to have inhibited the development of partnership relationships between DHBs and non-government providers, and of longer-term funding arrangements for high quality providers. Non-government providers perceive that DHBs have a tendency to favour their own providers when allocating contracts.

CONCLUSIONS

Decentralized decision-making is starting to make some inroads towards achieving some of the government's objectives with respect to resource allocation and purchasing.

Restructuring home care in the 1990s: geographical differentiation in Ontario, Canada

Through exploring the geographically differentiated effects of restructuring on the work of home care practitioners, labor process change is found to be spatially specific. It is through examining the spatiallity of labor process change that the differential impacts of health care restructuring on human health care resources can be determined. This has implications for human health care resource availability and service provision, which is particularly an issue for medically under-serviced regions. The restructuring approach, together with regulation theory, is used in this paper as tools for exploring the effects of health care reform on the local labor process. Both quantitative and qualitative data collected from home care practitioners in Ontario (Canada) show that the general trends in labor process change (work transfer down the home care hierarchy, increased time constraints, and enhanced job stress) are being similarly experienced, while shedding light on specific local differences. Findings show two working life factors to be differently experienced across the size of the place in which practitioners live and work. Two representative localities provide a closer examination of local differences in labor process change via the examination of local service cultures, local institutional practices, and local practitioner advocacy. The two sites are Sault Ste. Marie, located in northern Ontario's medically under-serviced northern health region, and Guelph, found in the province's well-serviced southern region.

An inquiry into good hospital governance: a New Zealand-Czech comparison

Background

This paper contributes to research in health systems literature by examining the role of health boards in hospital governance. Health care ranks among the largest public sectors in OECD countries. Efficient governance of hospitals requires the responsible and effective use of funds, professional management and competent governing structures. In this study hospital governance practice in two health care systems – Czech Republic and New Zealand – is compared and contrasted. These countries were chosen as both, even though they are geographically distant, have a universal right to 'free' health care provided by the state and each has experienced periods of political change and ensuing economic restructuring. Ongoing change has provided the impetus for policy reform in their public hospital governance systems.

Methods

Two comparative case studies are presented. They define key similarities and differences between the two countries' health care systems. Each public hospital governance system is critically analysed and discussed in light of D W Taylor's nine principles of 'good governance'.

Results

While some similarities were found to exist, the key difference between the two countries is that while many forms of 'ad hoc' hospital governance exist in Czech hospitals, public hospitals in New Zealand are governed in a 'collegiate' way by elected District Health Boards. These findings are discussed in relation to each of the suggested nine principles utilized by Taylor.

Conclusion

This comparative case analysis demonstrates that although the New Zealand and Czech Republic health systems appear to show a large degree of convergence, their approaches to public hospital governance differ on several counts. Some of the principles of 'good governance' existed in the Czech hospitals and many were practiced in New Zealand. It would appear that the governance styles have evolved from particular historical circumstances to meet each country's specific requirements. Whether or not current practice could be improved by paying closer attention to theoretical models of 'good governance' is debatable.

From Corporate Governance To Hospital Governance

As a result of multiple developments in health care and health care policy, hospital administrators, policy makers and researchers are increasingly challenged to reflect on the meaning of good hospital governance and how they can implement it in the hospital organisations. The question arises whether and to what extent governance models that have been developed within the corporate world can be valuable for these reflections. Due to the unique societal position of hospitals--which involves a large diversity of stakeholders--the claim for autonomy of various highly professional groups and the lack of clear business objectives, principles of corporate governance cannot be translated into the hospital sector without specific adjustments. However, irrespective of these contextual differences, corporate governance can provide for a comprehensive 'frame of reference', to which the hospital sector will have to give its own interpretation. A multidisciplinary research unit of the university of Leuven has taken the initiative to develop a governance model for Belgian hospitals. As part of the preliminary research work a survey has been performed among 82 hospitals of the Flemish Community on their governance structure, the composition of the governance entities, the partition of competencies and the relationship between management and medical staff.