The Ownership Form of Hospitals from the Viewpoints of Economic Theory...

The marketization of public services, among them health care service aims at a continuous increase in public expenditure efficiency, continual improvements in public services quality, the implementation of the professional management tools in the public sector and developing the plurality system of ownership forms in public service delivering – privatization in public services. Redefinition of the roles of the state and private providers, privatization in health care became a central theme of recent health care reforms in Slovakia. The debate about the pros and cons of privatization in health care is very intensive, though mainly at the political level. Some opponents still regard privatization as a policy simply advocated to cut back the role of the public sector in health care. But advocates of privatization believe it can raise effectiveness and quality. Our article analyses the problem of Slovak hospital ownership. It begins with a brief theoretical overview of the key aspects of privatisation: predominantly from the viewpoint of neoclassical public economics. The analytical part was intended provide a comparative analysis of performance of different types of Slovak hospitals. But the lack of publicly available data limits the scope and depth of our analysis. Despite these limitations our article argues that ownership form is not the main determinant of hospital performance. We base this argument on both theoretical grounds and on our empirical evidence from Slovakia. In the light of this argument, we propose that decisions about hospital privatisation and its form, in spite of their dominantly political character, should respect concrete conditions and the specific environment. A public-private-civil sector ownership mix seems to be the most appropriate current response for Slovakia. This work was supported by the Slovak Research and Development Agency under the contract No. APVV-0267-07.