This reform faced the challenge of converting a centrally planned hospital sector, where payments had been made through global budgets based on negotiations
and hospital size to a per-case payment system. If prices do not reflect actual costs and public health objectives are not taken into consideration in pricing health services, a range of undesired consequences may result. Providers may charge informal payments to compensate for inadequate formal payments,or they may avoid treating sicker patients.Services provided may be of suboptimal quality. Inappropriate referral patterns may develop between different levels or sites of service.