Public Sector and Management Reform and Future Development of Health Insurance in Thailand:
Hospital Autonomy and Devolution
The Thai health system is dominated by the public sector and therefore any
changes in the public sector will have quite a significant impact on the system as a
whole. The Thai government has initiated the public sector reform movement aimed
mostly at downsizing the public sector for more than 10 years. In 1998, the cabinet
drew up a plan for systematic reform of the public sector with five components,
redefining the roles of various public agencies, reforming human resources, the
financing and budgeting system, the rules and regulations including legislative reform
and organization cultural reform (1). They have set up plans to restructure as
well as re-orientate the various roles and functions and public service provision of
certain government agencies. The Ministry of Commerce and the Ministry of
Finance are the target ministries from the economic development perspectives. The
Ministry of Education and the Ministry of Public Health (MoPH) deal directly with
social services.
MoPH initially focused on redefining the roles of various departments in the
ministry aiming at downsizing the workforce and reorganizing them into autonomous
government agencies without taking into consideration the overall needs of the
health systems. The strategies for the reform then were to identify possible actors in
the system who could perform various roles and functions of the targeted ministries.
These include the private sector, local governments and other closely related government
units. MoPH’s proposal for reform was approved by the cabinet but was not
seriously implemented (2).
With two important developments in late 1998 and late 1999, the whole reform
movement of the MoPH changed dramatically. Due to the economic crisis, the Thai
government asked for a loan on Social Sector Reform from the Asian Development
Bank in 1998, which called for various social sector reform efforts including the
corporatization of public hospitals (3). In November 1999 the House of Parliament
passed the legislation on the Operationalization of Decentralization to the Local
Administration Units (4). This required various ministries, including the MoPH, to
devolve their functions as well as facilities and manpower to the local administration
within the following 10 years.