The World Health Organization (WHO) Department of Health Systems Governance and Financing and ThinkWell established a study agreement in 2019 to see the link between decentralization, public financial management (PFM), and healthcare, which aimed to:

  1. analyze the impact of the fragmentation of health spending, and focus on government spending on health; and
  2. to explore how globalization has influenced PFM’s health outcomes and to identify the challenges posed by globalization and PFM reforms.

The agreement provided a survey of seven countries – Burkina Faso, Indonesia, Kenya, Mozambique, Nigeria, the Philippines, and Uganda – and two joint reports on national cases and other publications.

The first report summarizes the impact of the division on health care funding, with a particular focus on health spending on small groups. These findings suggest that local governments have always relied heavily on transfers from central governments to provide their own funding. Central governments may need to boost government spending on health care as part of UHC strategies. The division of resources facilitates the division of collective work, creating barriers to the efficient distribution of resources into sub-sectors. For this reason, there is a great need for similar financial systems, which should be considered with a number of requirements. Finally, there is a limited potential for local governments to operate as health care consumers. Improving health care costs and care services can help reduce duplication and division as well as better procurement activities. The report outlines the policy options in detail as well as future research areas.

The second report outlines how regional divisions have changed PFM’s approach to health, highlights the serious problems that have arisen as a result of the conflict between governmental divisions and PFM reforms, and provides lessons on addressing those barriers. The international divide has disrupted the health budget. Budget variations undermine cooperation in all states, resulting in inconsistent or uniform policies and declining health budgets. Dividing communities does not mean being independent of managers or spending money on providers. Although small corporations have new powers to make decisions and manage finances, these have not been systematically extended to providers alone, and often offices may not respond appropriately to the need for change. Due to the delay in the reform of the PFM, the division of states has not been achieved by fulfilling its promise of transparency and accountability to the economy which the government is wasting. The persistence of budget plans in small areas also encourages accountability for inputs rather than outputs or outcomes.

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