Consistent with the property rights theory of ownership incorporating soft budget constraints (SBCs), we find that controlling for SBCs, for-profit hospitals drop safety-net services more often and exhibit higher mortality rates, suggesting aggressive cost control that damages non-contractible quality.

According to hitherto available data, health expenditures in Pakistan are relatively low in international comparison. Data1F published by the World Health Organization (WHO) for the year 2005 shows a lack of Pakistani health expenditures in most indicators, compared to other low-income countries (LIC). To answer the question whether these results reflect the real situation in Pakistan or whether they exist due to statistical problems, Pakistan, for the first time, developed its National Health Accounts (NHA) in 2009. Only the availability of good estimates of health expenditures allows for evidence-based policymaking and therefore good governance.

The results clearly indicate that the situation in Pakistan is better than what was earlier estimated; however, the total health expenditure (THE) is still low compared to neighboring countries and other LIC. As a result, it is clear that the WHO health expenditure figures for Pakistan are understated, because they mainly comprise public and household out-of-pocket expenditures on health. Expenditures of many other entities, like military, cantonment boards, autonomous bodies, private hospitals, and so on, have not been taken into account in earlier estimations. Therefore, expenditure figures of NHA Pakistan are higher than those of WHO. Overall, the official NHA results show that THE is 27 percent higher than the WHO figure.

Furthermore, this paper cross-checks NHA results with other already available data sources on household expenditure. This comparison includes preliminary results of the Family Budget Survey (FBS), which also includes health items as well as National Accounts (NA) data. In line with this comparison, we calculate a raising factor that can be used for the adjustment of NHA results according to NA. The raised NHA result shows 102 percent higher out-of-pocket (OOP) spending on health; this would result in OOP health expenditures of $25.15 USD per capita (compared to only $12.45 USD per capita in the NHA estimation). This result, based on the NA figure with $33 USD THE per capita, leads to a different evaluation in international comparison, since it nearly reaches the level of India, with $37.5 USD and more than the average of all LIC with $27 USD.

Objective: To show the pattern of patient satisfaction with top-level delivery organizations (Level 2 and Level 3 hospitals), and using neo-institutionalism approach to explain the relatively low satisfaction and to explore the limitations with top providers, focusing on how to improve the competence of Level 2 and Level 3 hospitals at both the individual hospital level and the whole delivery system level.

Data Sources/Study Setting: The household survey by the National Bureau of Statistics in China in 2008; China Health Statistics Yearbooks.

Data Collection/Extraction Methods: The analysis uses a 2008 sample medical experiences of 5,036 residents from 17 provinces collected in a household survey by the National Bureau of Statistics in China. The linear regression model, the structural difference regression model, and the ordered probit model are used in our framework.

Principal Findings: The imbalance between the needs of patients and the limited competence of top-level providers, and the conflict between the business expansion and the limited competence of those providers are deeply and widely influenced by patterns of patient needs, the top providers’ expansion, and the institutional environment.

Conclusions: In order to effectively respond to patient needs, top and lower level providers need to set their own individual priorities. The government needs to improve institutional arrangements to respond to patient needs with the development of a fair and appropriate reimbursement and compensation pricing mechanism, and with further evaluation of top level providers’ advanced and limited health services.

Since 1978, China has been primarily market-focused in its provision of health care and social services. The market-driven health care system has been characterized by perverse incentives for individual providers, patients, and hospitals that are inducing improper provision of care: overprescription of pharmaceuticals and high-tech testing, lack of effective primary care and gatekeeping, and competition for patients instead of referral. The national health care reform document that was made public in April 2009 recognizes this failure of the market in health care in China. The document suggests potential policies for improvement on the current system that are focused primarily on a targeted increase in government funding and an increased, changing role for the government. We assess the potential of this national health care reform to achieve the stated goals, and conclude that the reform as designed is necessary but insufficient. For the reform to meet its goals, the promised increase in funding should be accompanied by improved data collection, regional piloting, and a strong regulatory and purchasing role for the government in aligning incentives for individual and institutional payers, providers, and patients.