An Institutional Analysis of the Fiscal Autonomy of Public Hospitals in Vietnam

This paper explores the fiscal autonomy of Vietnam's public hospitals through analysing the formal autonomy rules and the actual autonomy practices among selected hospitals. We argue that Vietnam's autonomisation of public hospitals underpins the increasing switch of healthcare costs from the state onto society alongside the transition from the universal and free healthcare services to a mix of state subsidy and fees‐for‐services. Utilised as a strategic instrument, hospital autonomy is reinforced in service provision, capital mobilisation, and allocation of net revenues, leaving autonomy in other dimensions increase incrementally. Consequently, Vietnam's hospital autonomisation has occasioned various revenue‐maximising practices including the provision of “patient‐requested” services, provider‐induced supply of unnecessary services, excessive use of high‐tech diagnostic equipment, inappropriate prescription of drugs, increase in patients' length of stay, and receipt of informal payments. While discerning healthcare reform in a country context, this paper expects to offer lessons to policy‐makers in developing countries, which reform their healthcare services along the market principle