The Thai health-care system has long suffered from relatively high staffing levels
in the central region and the large urban centres. Historically, once a district was
designated a municipality, a provincial hospital was established no matter how
large the population it served. Many provinces in the central region thus have
more than one provincial hospital and human resource density favours this region
more than the peripheral rural areas.
The capitation allocation in the first year of the UCS (2002) included salaries and
meant financial deficits for provincial hospitals with a relatively high concentration
of staff, while those with fewer staff received surplus funding, although those
monies proved difficult to use to generate additional services. This led to much
controversy and, using its authority to manage the budget during the three-year
transitional period, the MOPH removed salaries from the capitation-based allocation
in the second year of implementation.