Report for the National Co-ordinating Centre for NHS Service Delivery and Organisation R & D (NCCSDO)

Transcription

1 Decentralisation, Centralisation and Devolution in publicly funded health services: decentralisation as an organisational model for health care in England Report for the National Co-ordinating Centre for NHS Service Delivery and Organisation R & D (NCCSDO) July 2005 prepared by Stephen Peckham* Mark Exworthy Martin Powell Ian Greener *Department of Sociology and Social Policy, Oxford Brookes University School of Management, Royal Holloway, University of London Department of Applied Social Studies, University of Bath Department of Management, University of York Address for correspondence Stephen Peckham, London School of Hygiene and Tropical Medicine, London Tel: ; stephen.peckham@lshtm.ac.uk

2 Executive Summary Background Current National Health Service (NHS) policy sets out a number of broad themes that include organisational freedom from central control, patient empowerment and clinical empowerment. These reflect many of the assumptions made in the literature about the benefits of decentralisation. In other sectors, as in the NHS, decentralisation is usually seen as a good thing because it: frees managers to manage enables more responsive public services, attuned to local needs contributes to economy by enabling organisations to shed unnecessary middle managers promotes efficiency by shortening previously long bureaucratic hierarchies produces contented and stimulated staff, with increased sense of room for manoeuvre makes politicians more responsive and accountable to the people. Aims of the study This review examines the nature and application of decentralisation as an organisational model for health care in England. The study reviews the relevant theoretical literature from a range of disciplines relating to different public- and private-sector contexts of decentralisation and centralisation. It examines empirical evidence about decentralisation and centralisation in public and private organisations and explores the relationship between decentralisation and different incentive structures, which, in turn affect organisational performance. Methods The review encompassed two main activities. The first was an analysis of the conceptual literature on decentralisation to clarify parameters that could be measured. Second we undertook a review of the extant literature: to map the available literature to provide a critical overview of existing work in relation to appropriate themes to identify areas where more research may be of use to consult with users to complement and enhance overall findings. NCCSDO

3 Findings It is clear that decentralisation in health policy is a problematic concept. First, there are significant problems of definition. The term decentralisation has been used in a number of disciplines, such as management, political science, development studies, geography and social policy, and appears in a number of conceptual literatures such as public choice theory, principal/agency theory, fiscal federalism and central local relations. It has links with many cognate terms such as autonomy and localism, which themselves are problematic. Other commentators tend to use different terms, such as agency central local relations, and national versus local. Whereas decentralisation and devolution tend to be the dominant terms, they are rarely defined or measured, or linked to the conceptual literature. Second, much of the literature refers to elected local government with revenue-raising powers or is related to changes in so-called developing or lower-income countries. Application to the English NHS, which is appointed and receives its revenue from central grants, is therefore problematic. The discussion in this report identifies three main problems associated with the analysis of decentralisation. These are as follows. There is a lack of clarity regarding the concepts, definitions and measures of decentralisation. The debate about decentralisation, and subsequent analyses of decentralisation, lack any maturity and sophistication. Assumptions about the effects of decentralisation on a range of issues, including organisational performance, are incorporated into policy without reference to whether evidence or theory supports such an approach. Clarity of the concept Previous studies have tended to treat decentralisation as a uni-dimensional concept defined by concepts that lacked conceptual clarity, such as power and autonomy. Little attention was paid in the literature to adequately defining and measuring the where and what of decentralisation. In addition, analyses of decentralisation pay little attention to clearly defining what is being decentralised and our new Arrows Framework (see overleaf) provides a useful way of conceptualising this aspect of the process. NCCSDO

4 The Arrows Framework Activity Tier Global Europe UK England/Scotland/Wales/ Northern Ireland Region, e.g. SHA Organisation, e.g. PCT Subunit, e.g. locality/practice Individual Inputs Process Outcomes Arrows indicate the direction of movement. PCT, primary care trust; SHA, strategic health authority. NCCSDO

5 Evidence on decentralisation and organisational performance Decentralisation is not a completely discrete area of research and more attention needs to be paid to how it is utilised as a concept in future practice, policy and research. The brief for this review identified two areas for analysis relating to relationships between organisations. In addition, the changing nature of the dynamics between parts of a system over time, resulting from the combination of multiple centres of direction and regulation (including financial, political and technical) and multiple strategies emerging among the regulated organisations (including collaboration, compliance and competition), was also identified as an area for investigation. There was little evidence in our review to be able to comment on these areas and further substantive reviews may be required. The key message from this review is that decentralisation is not a sufficiently strong individual factor to influence organisational performance as compared to other factors such as organisational culture, external environment, performance monitoring process, etc. Neither is there an optimal size/level that provides maximum organisational performance. Different functions and the achievement of different outcomes are related to different organisational sizes and levels. There are, therefore, trade-offs or compromises between different activities and outcomes; for example, different approaches to equity, responsiveness versus economies of scale and so forth. Key messages for policy and practice It is important that in making decisions policy-makers and managers recognise inter-relationships between inputs, processes and outcomes and levels in the sense that any organisation (or individual) can gain and lose. They also need to be aware that the evidence base for the impact of decentralisation on organisational performance is poor and that there is little substantive evidence to support the key assumptions made about decentralisation. It is also essential that decentralisation is seen as a process one of a number of factors that can be employed for achieving particular goals rather than as an end in its own right. This review has demonstrated that much discussion of decentralisation is based on assumptions that are not substantiated by theory or evidence. A key problem is that benefits in one context are incorporated into general assumptions and are often transferred to other contexts, despite the problems associated with doing this. Local and national health care organisations need to develop a more sophisticated understanding of decentralisation processes and learn that simple assumptions about the benefits, or otherwise, should be avoided. Health care managers and practitioners should therefore give more explicit recognition to the compromises/trade-offs between performance criteria (e.g. equity versus efficiency versus responsiveness, etc.) when developing strategies. Policymakers and managers also need to understand that decentralisation is not a NCCSDO

6 panacea it is a process which among other factors can have an impact on organisational performance but which should not be seen as an end in itself. Areas for further research We were asked to specifically examine gaps in the current literature and knowledge base. In general we recommend that consideration is given to research that addresses the issue of context with the use of good-quality case studies and also to research that takes a longer time span than the normal 3-year period, in order to capture change over a more realistic period. In addition, we believe that there is a need for research that examines specifically the relationships between and within levels by adopting studies that focus on health care economies rather than simply organisations. We suggest that in addition to these general comments future research is focused in two broad areas. Decentralisation as a concept Further research is needed on the development of conceptual models (and especially the Arrows Framework) for health services decentralisation and the way it is measured. The only dimension that is measured (albeit poorly) is fiscal decentralisation and further research is required to identify the key indicators for measuring decentralisation. Decentralisation and performance A relationship between decentralisation and organisational performance exists but it is often contextually specific or equivocal. Future research in this area should therefore incorporate decentralisation but should also address the different contexts of decentralisation. In particular, what function works best at what level and is there a specific receptive context for particular functions? In addition, research on decentralisation needs to move beyond a focus on single organisations to explore the extent to which local health economies or communities have autonomy. Particular areas of organisational performance might include exploring the relationships between decentralisation and accountability, human resources management and professional autonomy. NCCSDO

7 Disclaimer This report presents independent research commissioned by the National Institute for Health Research (NIHR). The views and opinions expressed therein are those of the authors and do not necessarily reflect those of the NHS, the NIHR, the SDO programme or the Department of Health Addendum This document was published by the National Coordinating Centre for the Service Delivery and Organisation (NCCSDO) research programme, managed by the London School of Hygiene and Tropical Medicine. The management of the Service Delivery and Organisation (SDO) programme has now transferred to the National Institute for Health Research Evaluations, Trials and Studies Coordinating Centre (NETSCC) based at the University of Southampton. Prior to April 2009, NETSCC had no involvement in the commissioning or production of this document and therefore we may not be able to comment on the background or technical detail of this document. Should you have any queries please contact