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REGIONAL DECENTRALIZATION AND HEALTH CARE REFORM IN SPAIN (1975-1995)

ANA RICO

The article analizes the evolution during the last twenty years of two important policy changes which involve major re-structuring

of political institutions in Spain: regional decentralization and health care reform. The main empirical puzzles that the article tries to

explain are the following: 1) the deep political decentralization of health care policy in Spain; 2) the processes of formulation and

implementation of the NHS model , initiated in 1975 and nearly completed in the late 1980's; 3) the ´reform of the reform’

experimented by the Spanish public health care system in the 1990's. The main explanatory conclusions are that major policy

reforms are not easy to made, specially when they involve substantial transfers of powers to sub-national governments or private

agents. For this reason they are fairly demanding in that the concurrence of several factors acting in the same direction is required

for their successful completion. In particular, those ambitious reforms seem to require the combination of political elites’ intense

preferences and citizens’ extensive preferences for the reform model. Generally, the historical coincidence of intense and extensive

political preferences might depend on the existence of a common cultural heritage about the way different institutions work.

Published in South European Politics

INTRODUCTION

The goal of this paper is to analyze the determinants and consequences of the process of regional

health care decentralization in Spain. Regional decentralization of public health services in Spain is a result

of two related institutional changes of the Spanish state: the reform of the public health care sector and the

territorial decentralization of state structures. Both institutional reforms take place in a context of general

re-structuring of political institutions that presided over the emergence of a new democratic regime. In this

vein, the main analytical claim of this paper is that in order to understand why health care is decentralized

in Spain we must first comprehend the determinants of those broader process of institutional reform.

I am grateful to the European University Institute and the Mission Researche Experimentation (MIRE) for supporting an

earlier version of this article, presented in the Conference on Comparing Social Welfare Systems in Southern Europe,

Firenze (Italy), 22-4 February 1996.

In fact, health care decentralization constitutes an specially interesting case study precisely because

it is placed in the intersection of two key institutional changes of the democratic period starting in the mid

70's. On the one hand, health care decentralization is part of a wider process of territorial re-structuring of

the Spanish state, traditionally centralized. In this sense, the model of Estado de las Autonomías designed

by the 1978 Constitution involves the introduction of some important features of the federal model. In

addition, it responds to the long-standing self-government aspirations of traditionally nationalistic regions,

such as Catalonia and the Basque Country.

On the other hand, the process of decentralization constitutes a central element of the health care

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reform initiated in the second half of the 70's and culminating in 1986 with the enactment of the General

Health Law. The socialist 1986 health care reform also involves an important institutional change

originated by the shift from the Social Security model to the National Health Service one. In this sense, a

fact that enhances the relevance of health care reform is that neither universal coverage nor regional

decentralization were undertaken in other welfare policies such as retirement pensions or unemployment

benefits (Guillén, 1994). For comparative purposes, it is also interesting to note that the nature and content

of the legislative powers devolved to the regional tier of government is a unique characteristic of the

Spanish case which is not shared by the rest of Southern European countries, with the partial exception of

Italy.

The paper is divided in six sections. The first one reviews some recent research on the

determinants of institutional change and tries to develop a tentative theoretical framework to account for

the process of health care decentralization in Spain. The second and third sections are dedicated to describe

the processes of formulation of the regional decentralization and health care reform policies, which take

place between 1976 and 1986. The fourth section explores the impact of regional decentralization on the

policy-making process from 1986 to 1996, emphasizing the prominent role played by regional political

authorities in the formulation and implementation of central health care policy. The fifth part applies the

theoretical framework developed in the first section to analyze the determinants of policy formulation and

implementation. Finally, the last section presents some conclusions from a comparative point of view,

placing the Spanish case in the context of other Southern European countries.

NEW APPROACHES TO THE DETERMINANTS OF INSTITUTIONAL CHANGE

The debate on the determinants of institutional change has experimented promising developments

during the present decade. In particular, the longstanding analytical emphasis on state institutions and

political elites has been recently complemented with an increasing attention to the role of culture, public

preferences and the mass public in policy-making processes leading to major institutional change. The

present analysis draws on three of those recent contributions of particular relevance for the case study: the

'meaning centred' approach developed by Lawrence Jacobs (1991) to explain mayor institutional changes in

the health care sector; the article by Sidney Tarrow (1995) on the role of social movements in the broader

re-structuring of political institutions which takes place during the transition to a democratic regime; and

Peter Hall's (1990) analysis of the determinants of major shifts in policy paradigms.

Explaining institutional change in the health care sector: public preferences, culture and national

experiences with institutions

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The article by Lawrence Jacobs (1991) tries to account for the process of formulation of health

care policy leading to institutional change in the United Kingdom (National Health Service Act of 1946)

and the United States (Medicare Act, 1965). The approach emphasizes the important role of public

preferences in policy-making processes. Public preferences are conceived here as an expression of

enduring cultural shared meanings and understandings evolving from the national historical experience

with the operation of different state and societal institutions in each particular sphere of state action. In this

respect, Jacob's approach connects with recent neo-institutionalist approaches.

Culture in turn is thought to influence institutional change in two ways: by affecting the content of

policy options change, and by acting as an important constraint on elite negotiating patterns. On the one

hand, it affects the content of policy options through two different mechanisms. First, it determines the

specific preferences of the mass public with respect to particular policy options, thus indirectly affecting

the strategic calculations of elected government officials. Second, it helps to conform the content of policy

alternatives of political elites even when such strategic calculations do not apply. In other words:

Because culture is all-encompassing -controlling the conceptual tools and emotional

repertories of all members of society- socially constructed values and assumptions even

'seep' into policy deliberations that are dominated by elites and seemingly insulated from

the mass public (Jacobs, 1991: 189).

The influence of culture on the relations between government officials and pressure groups, on the

other hand, depends on the specific national configuration and strength of those shared ideas.

Unambiguous and widely shared public preferences which overlap with government policy options

reinforce the position of state authorities vis-a-vis pressure groups, helps to neutralize political opposition,

and facilitate mayor institutional change. The opposite effect can follow, however, when public opinion is

either divided or differs from the projected government reforms.

The impact of social movements on institutional change during processes of democratization

Tarrow (1995) analyzes a second mechanism through which public preferences can influence

political and institutional outcomes in periods of high political uncertainty, namely the emergence of broad

social movements. Mass mobilization episodes arise in situations of major political instability and change,

characterized by increased access to the polity, formation of new collective identities and shifting alliances

and cleavages. Transitions from an authoritarian to a democratic regime constitute a paradigmatic example

of such changes in the political opportunity structure which facilitate the entrance of the mass public into

the political sphere.

The impact of mass movements, however, is contingent on the historical and national relationship

between elites and masses, and on how collective action is organized. Tarrow defends that social

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movements tend to facilitate the process of institutional change when responding to loose and informally

organized coalitions between elite and mass actors with overlapping claims which are widely shared by the

public. In addition, the success of mass pressures for institutional change is seen as dependent on the

specific form of collective action in which they engage. Peaceful, moderate and predictable mobilizations

are not perceived as a threat for the established political order and thus have more chances of facilitating its

reform, while violent and radical action can result in undesired blockage or inversion of the process of

institutional change.

The determinants of territorial decentralization in Western Europe: the emphasis on organizations, states

and elites

The two approaches described share a common concern about widening the range of

explanatory factors considered by previous studies, while firmly placing them in particular historical and

national contexts. In fact, both exemplify a more general reaction against the predominant modes of

explanation in their particular research fields. Jacobs is mainly reacting against the specific analysis of

institutions associated with the work of Theda Skocpol, which constitutes a very influential paradigm

within research on the institutional emergence of the Welfare State.

This already popular theory stresses the centrality of state capacity and autonomy as the main

determinants of major institutional re-structuring. In particular, the objective assessment of the

administrative capacity of the state by elected politicians, bureaucrats, and policy experts is considered to

explain the magnitude of future institutional change by reinforcing or weakening the autonomy of state

actors. Similarly, Tarrow's approach represents a reaction against the dominant explanation of institutional

change in democratic transitions, which tends to emphasize the role of moderate and consensual elite

negotiating patterns.

In contrast, some of the prevailing analyses of the processes of territorial decentralization that have

taken place in Europe during the second half of this century concentrate on explanatory factors such as

state structures and elite negotiation patterns. A significant work in this respect is the one by Kjellberg and

Dente (1988) which tries to explain the wave of local/regional decentralization of Western welfare states

during the 60's and 70's in the following terms:

It is indeed obvious that the local government reorganization would hardly have taken

place without the dramatic expansion of the public sector in most advanced democracies

since the end of the Second World War. From this point of view local government

reorganization... appears everywhere as an attempt to solve the tension between the

organizational requirements the expansion has given rise and the existing institutional

arrangements (Kellberg and Dante, 1988:2)

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Organizational requirements endogenous to state structures are also seen as the fundamental source

of change by one of the most influential analytical approaches to policy-making in decentralized states,

namely interorganizational theory. Both the devolution of powers to regional and local authorities and the

entrance of interest groups and private associations in the sphere of the state are analyzed here as a

functional response of state elites to the increased complexity of extended economic and social policies

which overload state capacities (Hanf and O'Toole, 1992; Kauffman, 1985; Hanf, 1978; Sharpf, Reissert

and Schnabel, 1978).

Extensive/intense public preferences and the role of international policy paradigms

In this context, the main analytical concern of the paper is to complement functional explanations

of territorial decentralization by stressing the important role played by public preferences and broadly

shared cultural meanings. In this sense, my analytical approach will specially emphasize two elements that

have only been implicitly referred to in the above pages.

The first one points to the latent distinction between extensive/intense public preferences which

arises from Jacobs' and Tarrow's different understanding of the role of public preferences. Jacobs, on the

one hand, emphasizes the influential role of extensive, wide-spread, broadly shared, public preferences.

Tarrow, on the other, by stressing the impact of mass mobilization, is implicitly pointing to another

dimension of public preferences which make them politically influential: intensity. In this respect, I will

argue that the prominent influential role of social movements and mass mobilization derive from their

specific nature as expressions of specially intense political preferences. Moreover, my main claim in this

respect is that the simultaneous coincidence of intense and extensive political preferences greatly reinforces

their separate impact on policy and institutional change.

The intensity of political preferences as well as its connection to broadly shared public opinion

issues is the central explanatory factor which emerges from the empirical analysis carried out in the

following pages. This insight is scarcely new, but it is not usually explicitly emphasized as a crucial

determinant of political changes. The first and most important mention of this concept in political science

can be found in Dahl (1956: 50): 'The intensity of the desires of other people and the probable political

actions resulting from different degrees of intensity are among the factors that many individuals and,

certainly, many political leaders might take into account in deciding their own political preferences'. In

addition, a traditional distinction of social psychology (also present to varying degrees in political culture

analyses) emphasizes that only specially intense cognitive and value judgements translate into a disposition

to take subsequent action in defence of them. Finally, the relevance of intense individual preferences to

determine desirable collective choices is also emphasized within the field of welfare economics, although

problems of empirical measurement often curtail its incorporation into theoretical models (Sen, 1970: 19).

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The second explanatory element that I will emphasize is the impact on mass and elite preferences

of international ideas about, and experiences of, state and social institutions. In this respect, I contend

that cultural shared meanings about institutions evolve from the interaction between national experiences

and international ones. Jacobs tends to disregard this factor because his period of study (1945-65) is

characterized by the consensual predominance of the Keynesian model of state intervention in economic

and social policy. However, both health reform and decentralization have taken place in Spain during a

period of change in the dominant international paradigm on state intervention, which have shifted from

keynesianism to neoliberalism. This shift has influenced the model of health care reform finally adopted,

thus acting as an important constraint on policy formulation and implementation. An important

contribution here to understand the determinants of this important policy shift is that of Peter A. Hall

(1990), which explains how the process of policy learning involved in major policy shifts is affected by

broadly influential international policy paradigms such as keynesianism and neoliberalism.

Hall argues that policy change is initiated as a result of obvious policy failure with the old policy

paradigm; or, in other words, from negative national experiences of the working of past institutions and

policy. This involves shifts in the locus of technical authority upon policy within the framework of state

expert officials, as well as incremental changes in the particular instruments used to attain policy goals and

in their particular settings. Those incremental moves in policy instruments are introduced by expert

bureaucrats working in isolation from the broader political sphere. Major change in policy goals, however,

does not automatically follow from that process. In addition it is initiated by politicians rather than by civil

servants, opening a process of wider participation and conflict within the political system as a whole.

The success of the attempt at changing broad policy goals depends on two types of determinants.

First, the introduction of the new policy paradigm will be facilitated if its content is seen as broadly

compatible both with the general ideological standpoints of the party in office and its electoral strategic

calculations. The latter involves that the new paradigm 'could be presented in terms that had broader public

appeal as well' (Hall, 1990: 17). The conclusion from the analysis of these political requirements is that

'When policy paradigms become the object of open political contestation, the outcome depends on the

ability of each side to mobilize a sufficient electoral coalition behind its alternative in the political arena'

(Hall, 1990: 18).

Second, the nature and strength of the policy paradigm greatly influences the outcome of that

struggle between state actors, political parties and interest groups in the policy-making process; and,

ultimately, the direction of policy outcomes. In Hall's words:

Policy-makers are in a much stronger position to resist pressure from societal interests

when they are armed with a coherent policy paradigm. The paradigm often dictates an

optimal course for policy, and, even where it does not, it provides a set of criteria for

resisting some societal demands and accepting others (1990: 21)

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Although the detailed analysis of the case-study share many of Jacob's analytical standpoints,

Hall's final inferences tend to place the emphasis on political and societal elites rather than the general

public. His explanatory factors, however, can be re-formulated in the terms posed by the distinction

between intense/extensive public preferences. From this point of view, successful paradigm shift requires

the simultaneous concurrence of two necessary factors.

First, the compatibility of the new paradigm with broadly shared public understandings derived

from past experiences of national institutions, which enhances its electoral appeal. Second, the intensity of

political and societal leaders' preferences for the international policy paradigm, which might depend not

only on ideology and electoral calculations, but also on the strength of their international commitments.

The combined effect of those two broad factors would greatly facilitate change: the former would

guarantee a latent majority disposition to accept the new ideas, the latter sufficient electoral mobilization

capacities of political leaders to transform this latent acceptance into open public support.

Hall's analysis suggests that far-reaching change in policy goals will not be easy nor complete,

however, in countries or policy sectors that do not meet either one of those requirements or both. In fact, I

will suggest that the debate about social policy in Spain is a paradigmatic example of an incomplete and

partially failed paradigm shift, precisely due to the fact that neither of those two requirements was fully

met. In this respect, it will be interesting to compare Hall's case-study on macroeconomic policy change

with the parallel Conservative attempts at reform in the welfare sector, where major policy changes were

less easy and complete. The positive experiences with national institutions and the derived broad public

support they enjoyed are probably important determinants of the partial blockage of policy change.

What happens when international experiences with state institutions differ from national ones? The

answer is related to the dynamics of the process of diffusion of international policy paradigms. Pressures

for national policy convergence towards international ideas arise mainly from two sources. The first one are

national economic policy experts, both within and without the state, which are in a privileged informational

position to learn from foreign experiences as part of their professional training and socialization. The

second source of pressure are international binding compromises which can take the form of trade

agreements, common market regulations or international debt responsibilities; such compromises obviously

affect more directly state actors and business representatives.

Therefore, this implies that the impact of international ideas and experiences on the mass public is

always mediated by specific groups of elites, specially when their content is highly technical. In contrast,

policy learning from national institutions is broadly accessible to the mass public and to all political and

societal groups. Thus, when the broad cultural content of both sets of experiences, the national and the

international, differ, national ideas will have more a priori chances to predominate in the policy-making

process.

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A powerful mediating factor here is ideology. Its impact on public preferences for institutional

change is mainly derived from the fact that established scientific knowledge about the consequences of

most policy changes is too weak yet as to become an uncontestable source of policy decisions. As a

consequence, ideological values are still a powerful filter of experiences with institutions. Those values are

the result of previous socialization experiences and processes of learning from past institutional interactions

which differ among social groups. They provide individuals with a broad interpretative framework to judge

complex and sometimes contradictory institutional experiences. As a result, reform proposals compatible

with such a priori values would be more readily incorporated, while the enactment of policy models that

threaten ideological values deeply-rooted in a majority of citizens would be difficult and problematic.

In this context, the conflict between international and national experiences is likely to crystallize in

ideological and power struggles among political elites. The outcome of such ideological struggles will

depend on which set of policy orientation predominates: the desire to meet the preferences of their

constituencies or the urge to comply with international compromises. The later will have more chances of

success in countries with a higher dependence on external economic help. The most probable situation,

however, is one in which none of both orientations fully predominates. As a consecuence, policy changes

will only be partial, while major paradigm shift will not openly take place.

THE POLITICS OF TERRITORIAL DECENTRALIZATION IN SPAIN

The existence of language and ethnic communities in Spain with distinctive cultural identities and

nationalist claims is no doubt a well known fact within the field of political literature. The historical

emergence of the Spanish state in the sixteenth century as a union of kingdoms with different cultural

traditions and legal institutions should be remembered if we are to understand the co-existence of different

national identities in contemporary Spain. In particular, Basque and Catalan political groups hold

permanent and explicit self-government aspirations from the first quarter of the XX century.

Nationalist claims were fostered by the Spanish pattern of industrialization, which mainly

developed in those peripheral areas rather than in the political centre (de Esteban and López Guerra, 1977;

Tamames and Clegg, 1984; Díaz López, 1985; Pérez Díaz, 1987). As a consequence, the Bourbons'

attempts to centralize state institutions resulted in recurrent episodes of open confrontation between the

central state and nationalist communities. From then on, central authoritarian governments tended to

repress the political demands and national identities of those regions, a tendency that reached a historical

maximum during the dictatorship of General Franco (1939-1975).

The conflictive interactions that presided over the building of a centralized state determined the

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emergence of two sets of broad cultural meanings in Spain: the first defending centralism, and suspicious

of the separatist and belligerent attitudes of the nationalist regions; and the second claiming the democratic

legitimacy of devolving political rights to those regions, and suspicious of the traditional centralist

positions of central political authorities (Pérez Díaz, 1987). Moreover, the confrontation of both cultural

traditions proved specially disruptive during the Second Republic, contributing to the tragic episode of the

Spanish Civil War (1936-1939).

Regional decentralization and the constitution-making process (1975-1979).

The political solution given to the long-standing regional cleavage during the democratic transition

which started in 1975 was marked by the conflict between these two sets of shared meanings. At the

beginning of the transition, the general attitudes of central political leaders with respect to regional self-

government claims were divided and generally ambiguous and dubious. Moreover, the policy option of

regional decentralization might activate two important threats for the stability of democracy: the strong

opposition and animosity of the military towards any solution resembling federalism, and the possibility of

hidden hostile and separatist intentions of nationalist parties (Pérez Díaz, 1987).

Even so, the violent repression of regionalist feelings during the Francoist period was largely seen

as a negative object lesson, and inclined central political parties to consider such claims as politically

legitimate (Díaz López, 1985; Pérez Díaz, 1987). In this respect, it is interesting to note that political

demonstrations during the transition to democracy joint demands for democratic freedoms with demands

for regional self-government. This was the result of a broader strategic pact between leftist and nationalist

forces to fight together against the Francoist regime (Aguilar, 1996).

For similar reasons, a majority of the population tended to consider regional demands for political

participation as legitimate. For instance, in 1975, 60% of Spaniards were in favour of conceding more

freedom to the regions, and only 15% against it (De Esteban and López Guerra, 1977), while the debates in

the press between 1976 and 1978 also showed a general defense of the concession of broad political

autonomy to nationalist regions (Granja, 1981).

In addition, the intensity of nationalist feelings in Catalonia and the Basque Country became clear

after their explosion as organized political opposition movements at the beginning of the transition. In this

sense, the considerable mobilizing capacities of the regional political parties which emerged in those two

regions allowed them to exert effective pressure on central political leaders, facilitated by their generally

moderate and consensual attitudes. This capacities for political pressure were to a great extent based on the

intensity of political claims in Basque and Catalan communities. For instance, in 1976, around 65% of

Catalans and 75% of Basques agreed in the polls to give their approval to participation in political

demonstration in defense of regional political rights (Garcia Fernando, 1982: 373, 445). In such

circumstances, it was generally felt that the prospects of the central state and the democratic regime to

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attain legitimation without making some concessions to the peripheral political groups were low.

That specific historical constellation of determinants explains the consensual support eventually

given by the political elites in charge of the constitution-making process to regional claims for self-

government. The political solution given to the regional question consisted in the constitutional sanctioning

of a highly decentralized structure of the state to counterbalance the strong Basque and Catalan political

claims (Granja, 1981). This constitutional scheme allowed all the regions, which received the constitutional

term of 'Autonomous Communities' (Comunidades Autónomas, CCAA), to obtain substantial (though

varying) shares of political power. In this respect, the Constitution recognized two types of CCAA that

might be labelled 'special' (mainly those regions with intense majority claims to self-government) and

'standard, which were given different political rights with respect to both the range of powers that they

could assume and the time period in which they could get access to autonomy rights.

The constitutional decentralization formulae, however, was rather ambiguous and contradictory, as

a result of the unsolved differences between proposals of traditional state centralism (mainly on the right)

and the advocates of a solution resembling federalism (mainly on the left) (González Casanova, 1979;

Bonime-Blanc, 1977). The lack of agreement on the range of powers to be devolved, and on the degree of

hierarchical control to be retained by the central state introduced several functional problems in the

institutional model finally established. The first was the unclear distribution of competencies between the

central state and the CCAA, which rendered the implementation of the decentralization formula

problematic. The second functional problem concerns to the varying distribution of competencies between

special and standard CCAA, which allowed for the costly maintenance of central state bureaucracy, still in

charge of policy formulation and implementation in several policy sectors in the standard CCAA.

In the field of health care services, the constitutional differences in the distribution of powers

among special and standard CCAA are specially significant. The special regions with constitutional rights

to assume full political competencies in the field of health were four (out of seventeen): Andalusia, Basque

Country, Catalonia and Galisia; later on Navarre, Valencia and Canary Islands also obtained those rights by

delegation from the central government. Those political competencies include the legislative development

of central state basic laws, and full implementation competencies. Central health authorities, on the other

hand, retain exclusive powers on financing, territorial distribution, supervision, and coordination, as well as

on the definition of broad policy goals through basic state laws.

In addition, the central state exercises the important power of deciding when and how those

competencies were in practice to be transferred, given that the Constitution left those aspects undefined. In

this respect, the decentralization process was conducted with absolute political discretion by central state

authorities. In fact, the process of transference to the special CCAA was undertaken in different moments

depending on the difficulties affecting the negotiations between regional political authorities and the

central government. In fact, with the exception of Catalonia (that obtained health transfers in 1981, under

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UCD), the process of devolution to the 5 remaining regions (Andalusia, the Basque Country, Valensia,

Navarre and Canary Islands) was undertaken after the socialist party entered regional governments, either

alone or in coalition with regional parties. The opposite applies to Galisia, a region where government has

been in the hands of the central right-wing Popular Party, that only obtained health powers in 1990, after

long jurisdictional conflicts with the central government.

The ten standard regions do not have constitutional rights to exert competencies in the field of

health care services, but only in the complementary field of preventive care, public health and sanitation.

This means that, according to the constitutional framework, those ten communities would remain under the

legislative and administrative auspices of the central state agencies. It also implies that the size and power

of central bureaucratic institutions would not decrease, given that they are still in charge of health care in

the ten standard CCAA. For instance, in 1992, when about 60% of Spanish population is attended by the

special regions' health bureaucracy (Giron et al., 1988: 35), the number of health care bureaucrats in

Madrid remains the same than in 1982 (about 6000 civil servants) (EL PAIS, 22 Feb. 1992: 11). Moreover,

the heterogeneous distribution of powers between special and standard regions, together with the different

timing of health devolution to the former, inhibited any possibility of joint regional pressure on central

government, as it happened, for instance, in the German case (Sharpf, 1988).

The first democratic government and the process of decentralization (1979-1982).

The process of transferring of powers to the special CCAA with constitutional rights to rapid

access to autonomy began in 1979 and was far from problem free. Serious political and technical problems

threatened the peaceful development of the devolution process, and also questioned the capacity of the

central government to control the increasing level of demands posed by regionalist movements and the

complex and costly technical requisites derived from the building of 17 new political and administrative

organizations. Those problems fostered the suspicious attitude of the military towards the potential threat to

national unity posed by the regional experiment, contributing to provoke the attempted coup of February

1981 (Tamames and Clegg, 1984:45).

The central government leaded since 1977 by the Union of Democratic Centre (Unión de Centro

Democrático, UCD) responded to intensified nationalist demands by pacting with the opposition party, the

Spanish Socialist Workers Party (Partido Socialista Obrero Español, PSOE). The result of this alliance

were the Autonomic Pacts of April 1981, which served as the platform from which the government and

opposition parties elaborated a draft Law to coordinate the devolution process. The so-called Organic Law

for the Harmonization of the Devolution Process (from them on I will use the Spanish acronym, LOAPA)

was passed by Parliament in July 1982, and tried to reinforce central state hierarchical control upon the

special regions.

Regionalist groups interpreted that attempt as a reproduction of the historical tendency of the

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central state to repress regional political rights. As a consequence, Basque and Catalan political parties led

massive demonstrations in Barcelona and Bilbao, which were also followed in other Spanish cities. In fact,

between 1981 and 1982 a total of 48 demonstrations took place in support of regional autonomy (Aguilar,

1996). Those parties did also lodge appeals with the Constitutional Court, on the grounds that the LOAPA

violated the Catalan and Basque Statutes of Autonomy (Estatutos de Autonomía, equivalent of the

Constitution at the regional level), already approved by regional referendums and legally sanctioned in the

parliament (Tamames and Clegg, 1986).

The Constitutional Court declared part of the LOAPA unconstitutional, although objections mainly

referred to the legal instrument used (an harmonization law instead of an organic law), rather than to the

political goal of reinforcing central state control upon nationalist regions. This decision meant a partial

triumph of regional parties1, but simultaneously opened increased possibilities for central state authorities

to slow down the decentralization process and reinforce central legislative control in each policy sector.

THE POLITICS OF HEALTH CARE REFORM

The main characteristic of the history of health care reform in Spain since the XIX century is the

failure of the reiterated legislative attempts to re-structure public health services. After long processes of

preparation and debate, political and economic difficulties resulted in legislative blockage, and changes

were finally introduced through urgent decrees with a considerable delay (Muñoz Machado, 1975: 45). As

a consequence, Spanish public health structures were usually behind the times, while the implementation of

changes were rendered difficult by the emergence of institutional innovations and new models of state

intervention at the international level.

The transition to democracy (1975-1978)

The process of health care reform which started in 1975 fits in well with this historical trend.

Public coverage of individual health care needs in Spain was initiated in the forties but remained a mean-

tested and largely residual system until the beginning of the sixties. Between 1962 and 1972 a series of

lSocial Security laws introduced three important changes: the inclusion of health care within the Social

Security system, a remarkable increase of public coverage2, and the creation of a large network of Social

Security-owned hospitals in charge of public health care provision3.

However, those incremental moves did not respond to a parallel change in broader policy goals,

but rather evolved as a result of the combined influence of bureaucratic pressures, economic expansion and

mounting opposition to the authoritarian regime. In fact, the first official proposal of major policy change

was produced in November of 1975, a few weeks before Franco's death, and counted with the opposition of

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prominent Francoist politicians (Vila López, 1979). The recommendations of the official report included

reinforced state intervention in the health care sector together with unification and administrative

regionalization of overlapping public networks.

An important determinant of those changes was the emergence of several conflicts and strikes

within the public health care sector from 1971 on, led by groups of young doctors with communist and

socialist allegiances. Conflicts were initiated in peripheral regions and combined sectoral demands for

socialization of health care with political demands such as regional autonomy and political freedom (de

Miguel, 1980: 62; López Gandía, 1980: 255). Between 1976 and 1977, the critical years of the transition to

democracy, the process of reform continued open, in a context of wider involvement of political parties,

technical and corporate associations and the general public.

Official declarations about the imminent reform abounded during these years, and several official

proposals and studies came out. In addition, the communist and socialist opposition parties launched their

programs of reform, which defended the adoption of the British model of a National Health Service and a

major managerial decentralization of implementation powers to the regions. Most of the opposition

programs were initially launched in Catalonia, were there is a long-standing historical tradition of social

medicine and prominent public health reformers (de Miguel, 1980: 73; López Gandía, 1980: 259; Campos

y de Miguel, 1981: 137; Coll, 1981: 307).

Moreover, the Catalan and Basque autonomous governments were established in 1977 and 1978

respectively, while the first health competencies were not transferred until 1979-1981 (DGAIRET, 1989).

This implies that regional administrative institutions and policy experts had more than two years to prepare

reform and planning programs, thus promoting their prominent role at introducing policy innovations

within the Spanish health policy arena (Moragas, 1982: 202; Campos y de Miguel, 1981: 73; Coll, 1981:

307). This also explains the important role that Catalan communist politicians and policy experts (in office

in Catalonia between 1977 and 1980) played all along the process of health care reform, both in Catalonia

(Cernadas, 1994) and in the central Spanish state4.

The first democratic government and the frustrated attempt at health care reform (1979-1982)

During the first democratic government after the approval of the Constitution (April 1979-

September 1982), two important attempts were made to carry out health care reform. The first

(unsuccessful) attempt was initiated in October 1979 responding to repeated pressures from communist and

socialist representatives at the Parliament (BOCG, 1979, 1980: no. 169, 179 y 180; DSCD, 1979, no.

11:481-497). Instead of launching the long expected legislative reform, the UCD presents a non-binding

document, the Resolution on Health Care Reform, which was passed by the Parliament on May the seventh

(BOCG, 1979-1980, serie G, no.3-I; DSCD, 1980 no.86 and 87). The Resolution was approved by 53%

affirmative votes, 44% negative ones and 3% abstentions (DSDC, no. 87: 5783), what reflects the

14

opposition of socialist and communist parties to the delay of the reform that the document represented.

The Resolution contained the major policy goals of the projected reform and established an eight

years period to launch it, justifying the delay by referring to the financial problems affecting the Social

Security system (BOCG, no.3-II: 691-700). In fact, the impact of the economic crisis and parallel national

socioeconomic changes had dramatic consequences upon the Spanish Social Security System between

1975 and 1982. Global social expenditure increased 39,7% in real terms between 1975 and 1982, and from

9,9% to 15,5% as a percentage of the GNP between 1975 and 1980 (Maravall, 1992: 8, 36, 38). Also

between 1975 and 1982, the number of pensioners rose 31,6% (Guillén, 1995: 7) and public expenditure in

pensions increased in real terms by 29,3% (Maravall, 1992: 39); unemployment rates escalated from 3,1%

to 16,3% (Maravall, 1992: 52), while expenditure in real terms multiplied by 13 between 1974 and 1981

(Guillén, 1995: 8). In contrast, health care expenditures had a modest increase of 8,3% in real terms

(Maravall, 1992: 39). According to the declarations of the UCD Minister of Health, Manuel Núñez, this

relative modest increase was mainly due to the fact that the health care sector was considered as subsidiary

with respect to income transfers (DSCD, 7 November 1985, no.246: 11102).

The second attempt was made in the context of the National Agreement on Employment (Acuerdo

Nacional de Empleo, ANE) signed in July 1981 by UCD, the employers association and the two main trade

unions. In 1982, during the negotiations to implement the agreement, the former proposal of health care

reform was further developed and a calendar fixed to execute it. However, and again according to the

declarations of the UCD Minister of Health (DSCD, 7 November 1985, no.246: 11101), the combined

effect of financial problems, policy disagreements between the UCD and prominent socialist leaders

(participating through the socialist trade union), and regions/centre disputes in the Constitutional Court

block the attempt once more.

With respect to health care decentralization, the interactions between regional and central

authorities were fairly similar in their conflictive nature during this period to those affecting the central

state attempts at general coordination of the decentralization process through the LOAPA5. The process of

devolution of health care powers to the regions was initiated in December 1980 with the agreement

between the UCD and the Catalan CiU to transfer competences to Catalonia (Arqués i Serra, 1989: 72). In

July 1981, the first Decree initiating the devolution of health care powers to Catalonia was passed

(DGAIRET, 1989). Four months later, the UCD government initiated conflicts by launching the Royal

Decree 2824/1981, aimed at reinforcing central state authority, widely known as the 'health care LOAPA'.

Also in this case, Basque and Catalan governments simultaneously lodged appeals with the Constitutional

Court, which were not resolved until May 1983, when the Court declared the Decree unconstitutional6.

Although no objections were posed by the Court to the content of the Decree, it was considered that such

important moves should be approved by law and not by decree.

15

The first socialist government and the enactment of the General Health Law (1982-1986)

Thus, in May 1983, a few moths after the first socialist health Minister, Ernst Lluch, was

appointed, the sentences of the Constitutional Court had resolved up most of the constitutional ambiguities

with regard to the distribution of powers between levels of government, which helped to loosen the

previous blockage of central health care reform. In this respect, the Court guidelines favoured the attempts

of the central government to impose hierarchical coordination on decentralized regions7. In addition, the

need to pass a basic state law was also made urgent by the enactment in 1983 of important Basque and

Catalan regional health care laws under conditions of almost complete discretion8. Later on, in February

1984, the second Decree devolving health care powers to Andalusia was passed, reinforcing the need for a

general, basic central legislative framework to coordinate regional health policy-making9.

This was the particular political context when the new socialist Health Minister decided to initiate

the public discussion of the first draft of the General Health Law in December 1983 (EL PAIS, 28 Dec.

1983: 19). The reform had 4 broad political goals, which had been stake in the political debate since 1975:

(1) the separation of the health care services from the system of Social Security, with the central aim of

financing the services through general taxation; (2) the introduction of universal health care coverage for

all Spanish citizens; (3) the unification of the fragmented, overlapping networks of public providers, and

the clarification of the future role of the sizeable sector of (mostly) non-profit-making private providers

contracted out by the public system; (4) the enactment of the basic state legislation and the institutional

framework structuring regional decentralization.

The initial socialist reform model, inspired in the British National Health Service, provided clear,

well-known answers for the four dilemmas: universal, free access to a health care system formally

separated from the Social Security, financed by the public budget and delivered mostly by public providers,

that entails the nationalization of the voluntary sector; centralization of legislative, planning and financial

responsibilities, combined with a profound administrative decentralization to all the regions. Those were

exactly the proposals defended by the socialists until 1985, and also shared by the communist throughout

the policy-making process.

The labourist model of NHS counted with the support of international health care institutions such

as the WHO and was perfectly compatible with the social-democratic ideology of the party in office. In

addition, with the exception of the public/private mix in health care provision, the other major policy goals

(that is, points (1), (2) and (4)) were generally shared by all the central political parties. A partial exception

to this general agreement was the right wing Popular Party (Partido Popular, PP), which defended the

introduction of a scheme of user co-payments as a complementary source of public financing.

Disagreements between the socialist party and the centre-right Basque and Catalan regional

parties, on the other hand, mainly focused on the institutional model of decentralization. In this respect, it is

important to note that two-thirds of the amendments posed by Basque and Catalan political parties in the

16

parliamentary debate of the General Health Law referred to the territorial distribution of power. However,

there were also a minor disagreement between the Catalan parties and the socialists about the role of not-

for-private providers, that will be mentioned in more detail below.

Finally, the broad agreement among the central political parties on universal, free of charge access,

finance by the public budget and regional decentralization was also shared by the general public and, to

some extent, by the medical profession. Data in this respect was available since the second half of the 70's,

when massive public opinion surveys were conducted as part of the preparatory studies for the health care

reform. The surveys showed that in 1975, 96,6% of the population defended that the state should provide

health care for all (INP, 1977: 756); while roughly two thirds of the medical profession was in favour of

socialized medicine in 1978 (González, 1979: 150). In addition, also in 1978, two thirds of the population

thought that employers paid too much under the Social Security system, while almost 80% supported that

the state should pay the bulk of health care instead (Servicio de Estudios Sociológicos del IESS, 1979: 25).

Finally, two thirds of the medical profession were in favour of a health care organization regionally

decentralized, while the same option was supported by more than one half of the population (Servicio de

Estudios Sociológicos del IESS, 1979: 130).

However, the issue of public/private provision was far more controversial. On the one hand, the

main right-wing parties, UCD and PP, exerted considerable parliamentary pressure on the socialist to

include private hospitals within the National Health Services, yet preserving property rights and regulatory

discretion. In fact, almost 60% of the UCD and PP amendments to the General Health Law focused on the

role of the private sector. However, the centre-right party UCD was eager to accept increased government

regulation of private hospitals in exchange, while it put more emphasis on not-for-profit hospitals and less

on professional power of the medical class than the right-wing UCD.

In addition, both the medical profession and the general public were fairly divided on that issue,

although they generally favoured mixed public/private provision. In this respect, 70% of the medical

profession and 40% of the public opinion was favourable to the maintenance of some private provision

(Servicio de Estudios Sociológicos del IESS, 1979: 130), while the quality of private provision was

considered higher by 40% of doctors and almost 60% of the public opinion (INP, 1977: 789).

Finally, the distribution of support for the broad policy model among pressure and societal groups

was described by the communist parliamentary spokesman as follows (DSCD, no.216: 9889):

Trade unions, social organizations and a large part of the political representatives of the

Spanish people have favoured a model of health care reform involving the creation of a

public health care service along the lines of the National Health Service. The only ones

that are against this alternative are the elites of the Medical College Organization,

employers associations of private providers, a section of the pharmaceutical business

association and financial sectors interested in launching complementary health insurance

schemes

17

The positions of all the actors were emerging along the process of health care reform, which started

in December 1983 and ended up in April 1986 with the enactment of the General Health Law. The draft of

the law, however, remained unchanged until October 1984, when a meeting of the Council of Ministers

uncovered the existence of substantial divergences among the socialists with regard to the capacity of the

state to finance the reform (EL PAIS, 25 October 1984: 26; EL PAIS, 27 October 1984: 23; EL PAIS: 12

December 1985: 22, 14 December 1985: 25). In particular, the main issues at stake were four key aspects

of the draft: the shift from Social Security funds to general taxation, the free-of-charge access to the public

system of those high income groups still uncovered, the role of private providers contracted out with the

public system, and the scope of regional decentralization.

The first three issues involved a confrontation between the Ministry of Finance and the Ministry of

Social Security, on the one hand, and the Ministry of Health, on the other. The former defended the need to

control public expenditure and stressed the incapacity of state structures to undertake a policy shift as

ambitious as the building of a National Health System. This position was congruent with the dominant

neoliberal positions of the socialists regarding economic policy as well as with the international

compromises derived from the integration of Spain in the European Community, which was negotiated

during the same time period as the health care reform (Maravall, 1992: 19). Such international

commitments were widely supported by the public opinion, as two third of Spaniards supported EC

membership in 1986 (Maravall, 1991: 19).

The blockage of the process of reform caused by those financial conflicts began to weaken in

February 1985, while a final agreement was reached in the Council of Ministers of April the 2rd, a couple

of days before the initiation of the parliamentary discussion of the law10. As a result, both the financing by

the public budget and the extension of public provision were to be pursued through a gradual process,

while the pace of change was subordinated to the economic circumstances of the country. In addition, the

access to the system by high income groups was guaranteed, but was to be paid by them at market prices.

The fourth issue at stake, namely the scope of regional decentralization, was the one more radically

transformed during the policy-making process. In this respect, the initial idea of administrative

decentralization combined with reinforced central control was soon abandoned by the socialists. This was

the result of the extensive, influential intervention of regional political parties during the policy-making

process, and specially during the period of parliamentary debates. The internal divisions among the

socialists, which combined ideological and financial problems were in this case successfully exploited by

the Catalan and Basque nationalist parties. Ideological disagreements relate to the conflict between

traditional centralist standings and pro-nationalist attitudes within the socialist party, partly explained by

the federation of the central socialist party with the Basque and Catalan socialist parties11.

On the other hand, financial divisions derive from fears that extensive decentralization might

18

increase public debt and undermine central control of public expenditure. Such fears were widely shared by

the public opinion (Moragas, 1982: 214), and were specially influential during the policy-making process.

In particular, the conflictive negotiations between central and Catalan authorities to solve the problem of

the Catalan public deficits in the field of health, which took place between 1984 and 1985, made specially

visible this issue. In turn, the agreement reached in June 1985 in that matter did considerably help a

subsequent compromise between the Catalan party and the socialists on the health care reform.

As a result of nationalist pressures and internal division within the government, most of Catalan

and Basque amendments were introduced by the socialists, and the final version of the law did recognize

almost full legislative and planning powers to the special regions as well as important financial and self-

organization discretion. It is interesting to note that the prominent intervention of regional political parties

in the making of the General Health Law, and the audience given by the socialists to their claims was not

extended to other affected social groups (Rodríguez and de Miguel, 1990: 110), nor to the rest of the

political parties in the opposition (DSCD, 11 June 1985 no.215: 9856, 9876, 9879).

Finally, it is important to remark that the changes introduced in the model of regional

decentralization had significant consequences on the institutional reform model, as it entailed the

incomplete adoption of the National Health Service model. As it was stated by the Minister of Health in the

Parliament:

We can not establish a NHS in Spain, because the Spanish system is not only

administratively decentralized, but also a system which involves the devolution of

political autonomy to the regions. For this reasons, the Services have to be constituted at

the regional level, while at the central level there only can exist a National System

articulating the different Regional Services... (DSCD, no.215: 9854, 11 June 1985)

DOES DECENTRALIZATION MATTER?: CENTRAL HEALTH CARE POLICY AFTER THE

REFORM AND THE IMPACT OF REGIONAL POLICIES (1986-1996)

The implementation of the health care reform (1986-1990)

The implementation of the 1986 reform was initiated by the second socialist government in 1987,

in a context of economic expansion and public expenditure growth. In the second half of the 1980's, the

average annual growth rate of the GNP was higher than 4%. Moreover, the tax reforms of the UCD and

PSOE governments, undertaken during the first half of the 1980's, brought about a considerable increase of

the fiscal capacity of the state, favouring the implementation of the health care reform. In fact, tax revenues

increased 6.6 percentual points of the GNP between 1982 and 1990, while more than 2 million of new tax-

payers were emerging between 1982 and 1987 as a result of the fight of socialist governments against tax

19

evasion (Maravall, 1992: 36-7).

In 1987, a new Minister of Health was appointed and a corporate body to coordinate

central/regional policy-making created, namely the Interterritorial Council of the National Health System.

In 1989, 70% of public health care expenditure started to be financed by the public budget, a percentage

that reached more than 80% by the mid 1990's. In addition, the process of decentralization was extended to

five additional regions: the Basque Country and Valencia in 1987, Galisia and Navarre in 1990, and

Canary Islands in 1994. As a consequence, regional political authorities direct the implementation of the

reform in a territory comprising 60% of the Spanish population.

The new health care authorities soon proved their ability to respond quickly to the implementation

challenge as well as their capacity to introduce policy innovations at a faster rhythm than the central state.

A significant example is the Basque 26/1988 Decree of February the 16th, enacted six weeks after the

devolution of health care powers, which extended universal coverage to all the inhabitants of the Basque

Country (Freire, 1993: 75). The Basque initiative was followed by Valencia, in June 1989 (Decree

88/1989), and finally, after some resistance, by the central state in September 1989 (Royal Decree

1088/1989).

However, the crucial paradox dominating the implementation of health care reform in Spain since

1990 is that the policy paradigm which is on the basis of the reform, namely the British NHS model, starts

to be questioned in Europe precisely at the time that the implementation process in Spain was launched.

The new policy paradigm develops along the principles of managed competence proposed by Alan

Enthoven in the mid 80's, and introduced by British government from 1989 onwards under the label of

internal market reforms. The core of the proposals, which involve a major policy shift in the health care

sector, is to maintain public financing and universal access, but splitting up financing, purchasing and

provision of health care services, fostering competence among providers and recognizing a new extended

role for private providers and managerial techniques within the public health care system. As a result of the

international paradigm shift, the early 1990's represents to some extent a turning point for Spanish health

policy.

The second wave of reforms in the Spanish Health Care System (1990-1995)

As the new ideas are progressively adopted in Europe, the Parliament of Catalonia passes the

Catalan Law of Health Care Reform (Ley the Ordenación Sanitaria de Catalunya, LOSC) in May of 1990,

roughly a month later that a similar reform, the quasi-market reforms, began to be applied in the British

NHS. The law tries to make compatible the principles of the 1986 General Health Law with the new

reform proposals. Those proposals include strategic measures such as the splitting up of financing (in the

hands of the Department of Health), purchasing (managed by the newly created Servei Catalá de la Salut),

and provision functions. With respect to the provision of services, the reform involves a public/private mix,

20

so that public provision is to be shared by private (mostly not-profit-making) hospitals contracted out with

the public system and by the public hospitals and primary health care centres managed by the Institut

Catalá de la Salut.

The reform also involved some operational measures such as reinforced competition among public

providers supported by new evaluation systems of economic and clinical outputs; regulation by private law

of the top public institutions responsible for policy formation and direction, what involves that top

managers voluntarily renounce to their civil servants status to adopt an standard labour contract; the

decentralization of planning and priority setting to the local level and to the health care centres; and,

finally, the introduction of management and organizational innovations characteristic of the private sector.

This latter measure also involves a public/private mix in the management of health care centres, although

the public control in such managerial joint-ventures is guaranteed.

Several singular features account for the change of policy paradigm in Catalonia. In the first place,

the unique institutional features of the Catalan health care sector, in which private non-profit-making

hospitals provide two thirds of public hospital care (Coll, 1981:308). In this respect, the explicit legal

legitimation of the public/private mix in health care provision is specially significant given that the General

Health Law prescribes that private provision should be gradually substituted by public centres. The

predominance of private, not-profit-making hospitals within the Catalan public system is the result of a

historical tradition of flourishing private investment in health care which determines positive national

experiences of the working of private health care institutions. Although there is not data available about

Catalan public opinion on that issue, the unanimous consensus (involving employers association, trade

unions, the medical professions, and all political parties in the opposition, including the communists)

achieved by the Catalan government to pass the 1990 law is illustrative of the widely shared positive

experiences of private health care institutions in Catalonia (Cernadas, 1994).

In the second place, the new international paradigm was broadly compatible with the ideology and

electoral program of the centre-right party in office, CiU. In fact, the desire to preserve the sizeable private

sector contracted out with the public system is reflected both in regional policy making since the early 80's

(Cernadas, 1994) and in the Catalan amendments to the General Health Law. Overarching shift in policy

goals, which contradicts the basic central legislation approved in 1986, was facilitated in the late 80's by

two set of factors. On the one hand, the emergence of a coherent policy paradigm at the international level

reinforces the long-standing Catalan reform goals. On the other hand, the opposition of central state

authorities to the projected Catalan reform began to weaken in March 1990, when the third socialist

Minister of Health was appointed, who favoured the need of a 'reform of the reform' partly based on the

managed competition proposals.

The Catalan reform would prove highly influential for regional and central policy-making during

the first part of the 1990's. With respect to central health care policy, the 1990 Catalan law was often

21

quoted during 1990 and 1991 by central health authorities and the press as the model to follow in the rest

of Spain. In a highly sensitive political atmosphere, the Parliament appointed a committee of experts in

January 1991 on the initiative of new Health Minister, with the objective of evaluating the performance of

the National Health System, and designing the subsequent 'reform of the reform'. The Committee of

Analysis and Evaluation of the National Health System (Comisión de análisis y evaluación del Sistema

Nacional de Salud, 1991), reported in July 1991.

The report recommended a deep structural reform along the lines of the managed competition

proposals as well as the introduction of some unpopular measures such as user co-payment schemes, while

it opened a process of wide public debate and contestation. In contrast with the broad social and political

consensus achieved in Catalonia on the new policy paradigm, the committee recommendations faced strong

opposition from Trade Unions, professional associations, interest groups, the public opinion, the press, and

the parties on the left (including a significant sector of the Socialist Party). In this sense, the

recommendations of the Committee were interpreted by most of these groups as entailing an over-

whelming privatization of the health care service, and subsequently, they were rejected on ideological

grounds. The debate ended up with the open renounce of the socialist government to introduce the reform

proposals and with the dismissal of the socialist Minister of Health, which favoured most of those

proposals (EL PAIS, 27 September 1992: 22)12.

However, although major shift in policy goals was blocked, the new reform proposals introduced

significant changes in the policy instruments and their concrete settings in the health care sector. This

implies that the emphasis on public sector expansion and patients rights presiding over the 1980's health

care policy is displaced by a new emphasis on cost containment and efficiency during the 1990's. An

interesting example at the central level is the introduction of a new policy instrument, namely an explicit,

detailed contract with public and non-profit-making hospitals responsible for public provision as a pilot

experiment in 1992, which is generally launched in two thirds of the regions by central government in

1993. The contract involves a limited managerial decentralization to health care centres, while it specifies

the expected levels of hospital activity (and, for this reason, it is called contract-program) as well as the

expected costs for each case-mix category. A related instrumental aim is to introduce prospective funding

of hospital provision to replace the previous system of retrospective re-funding of the total expenditures

incurred by hospitals (González et al., 1995).

A curious feature of the Royal Decree 858/1992 that launched the contract-program is that it

silently introduced significant strategic changes, some of them included within the formerly rejected reform

proposals. The central policy goals of the contract-program, as stated in the Decree, are to promote the

separation of financing and provision functions and to foster competition among providers in the medium

term. In this respect, the Decree involves the explicit legitimation of the role of private, specially not-for-

profit providers within the public sector, what contradicts the formal content of the General Health Law. In

22

fact, only a 15% of public central health care expenditure flowed through private centres in 1975; this

percentage mounted to 22% in 1980 (Coll, 1980), while it had went down to 15% at the end of the 1980's,

remaining at that level until 1993 (López Casasnovas, 1993: 19). Both those figures as well as a detailed

analysis of the parliamentary debate on the General Health Law suggest that there was not a firm

commitment to implement the gradual substitution of private provision formally stated in the law. In this

context, what the Decree intended was to legally enforce the maintenance of the role and size of the private

sector, rather than its expansion.

Coming back to the operational changes included in the Decree, both the contract and the system

of prospective funding were first launched by Catalonia in the second half of the 1980's, and subsequently

adopted by several autonomous regions from 1991 on13, and in the central state from 1992 on. In addition,

the 1990 Catalan law had a remarkable impact at the regional level. The regulation of some of the activities

of the Catalan Health Care Service through private instead of administrative law is adopted by several

regions between 1992 and 1994 (Viñas, 1993). In addition, the Basque centre-right party launched a

programmatic document (Estrategias para la Sanidad vasca, Strategies for Basque Health Care) aimed at

guiding the subsequent 'reform of the reform', which was passed by the Basque Parliament in June of 1993.

It also entails the progressive separation of financing, purchasing and provision functions, the regulation of

government institutions and health care centres by private law, and the contracting out of services to the

private non-profit-sector (Fernández, 1993; Villar, 1994). The programmatic document set the basis for a

new law which will be discussed in the Basque Parliament in the last months of 1996.

Finally, three innovative measures, which fall within the category of policy instruments, are

launched in Andalusia during those years, under the government of the socialist party. The first one

consists of contracting out the full Andalusian emergency services to the private sector, a reform proposal

that is rejected by the Andalusian parliament in 1992; instead, a management company with public status is

created in 1993. It is interesting to note that the blockage of such proposal was mainly due to the strong

opposition of the communist party, the Trade Unions and professional association, while the Catalan

reform, much more ambitious, was passed with their explicit agreement. The second operational reform

measure is similar: a hospital of mixed public-private status is created as a pilot experiment, which includes

the most recently developed techniques of private management. In addition, a third reform measure

includes the introduction of an innovative system of performance related pay to hospital (1991) and

primary care managers (1992). The new system of incentives to managers was evaluated in 1994, and

showed excellent results (Martín, 1993).

Recent trends and future reforms in the National Health System (1995-)

The second half of the 1990's is characterized in Spain by the opening of several parallel debates

on the role of the private sector and the introduction of innovative organizational measures. In this respect,

23

the first measure enacted is the reform of the Catalan 1990 Law, which is passed by the Catalan Parliament

in September 1995. The most interesting measure included in that reform is the possibility of contracting

out public primary care with cooperatives of General Practitioners, a change which is currently being

discussed in the Basque Country as well.

The second measure adopted is the contracting out of hospital care to a private company in a

couple of Valencian counties, a reform undertaken by the new Valencian government, under the Popular

Party since the regional elections of 1995. Such company will enjoy monopoly rights during twenty years

to provide hospital care in such counties. This measure attracted strong opposition and rapid mobilization

by Trade Unions, user associations and the socialist and communist parties. The previous attempt of the

Valencian government to open top management positions to open competition in the private managerial

labour market was considered unconstitutional by the Courts (EL PAIS, 1 February 1996: 26; EL PAIS, 2

February 1996: 30).

Both measures acquired special significance when the PP speak person on health care matters at

the central level announced in February 1996 that the Valencian model was going to be applied to the rest

of Spain if the Popular Party won the national elections, to be held in March 1996. Actually, several reform

proposals in this line were included in the electoral program of the Popular Party. In the first place, a

programmatic goal is to contract-out public health care to all the Spanish private centres, while the

percentage of them currently contracted out is only 10%. The second proposal is to adopt the Netherlands’

model of competence between public insurance companies, although maintaining full public financing of

health care.

The first months of government of the Popular Party suggest, however, that those programmatic

goals will not be enacted in the short term, partly due to the strong social and political opposition to them.

Only two limited attempts were made, and both of them have been frustrated up to now. In the first place,

the Royal Decree 10/1996 is passed in June the 7th, which allows the management of public health care

centres through private law formulas. The original text of the Decree is modified two days later to eliminate

the explicit mention to private companies, as a result of the fierce opposition of the Parliament.

In addition, the Minister gives new proofs of moderation by declaring to the Congress in June the 28th that

the management of centres will be kept under public ownership, and that the content of the Decree will be

included in a Law draft in order to allow its open discussion in the Parliament.

In the second place, the Popular Party opened a public discussion in September 1996 on two

schemes of user co-payments proposed by the Catalan party CiU. Those proposals attracted strong political

and social opposition as well, while two thirds of Spaniards were against them according to the public

opinion polls released in the press. In this sense, those two moves suggest that any reform proposal that

goes beyond the measures already approved in the first half of the 1990's will require the formal

modification in the Parliament of the General Health Law, while it would encounter important political

24

obstacles and endanger the narrow electoral support enjoyed by the Popular Party.

DETERMINANTS AND CONSEQUENCES OF INSTITUTIONAL CHANGE: SOME

EXPLANATORY FACTORS OF HEALTH CARE DECENTRALIZATION AND REFORM IN SPAIN

The main explanatory factors that can be drawn from the empirical evidence on the process of

health care decentralization are as follows. In the first place, major institutional change seems to require the

simultaneous existence of intense and extensive public preferences favouring reform. The national

configuration of those preferences seems to depend on the interplay between national and international

experiences with institutions. Such historical experiences determine the emergence of different sets of

cultural meanings and understandings which affect the policy preferences maintained by both the general

public and political elites. The existence of a common cultural heritage in a particular policy field, reflected

in broadly shared, extensive public preferences for a particular policy option will greatly facilitate change.

However, extensive public preferences will only lead to overwhelming change in policy goals as a result of

the existence of political or societal organizations as well as social movements capable of undertaking

political action, that is, of defending such preferences with an specific intensity.

In the first place, and with respect to regional decentralization of state structures, the cases of the

LOAPA and the General Health Law show that the power of regional political representatives to effectively

block central attempts at imposing hierarchical control was mainly derived from the readiness of their

constituencies to mobilize in defence of their interests, and to obtain support for their claims among the

general public. This contention stands in evident contradiction with the assumption of interorganizational

theory that the power of regional governments to resist central commands is mainly a functional outcome

of their information and implementation resources. Although the latter obviously play a part, functional

explanations leave a good deal of important factors out of the analysis.

Nor can the great high influence obtained by regional parties all throughout the policy-making

process be explained by their weight as political parties, since this did not surpass the 5% of the national

turnout in the general elections of 1982. In addition, the socialists obtained an overwhelming majority of

the votes in those elections so they did not need to reinforce or legitimate their legislative power by co-

opting the support of other political parties.

Moreover, the constitutional rules favoured the position of the central state in the

intergovernmental distribution of power, while the doctrine of the Constitutional Court further enhanced its

legitimate power to impose hierarchical control from above. Besides that, the institutional framework

designed by the 1986 General Health Law to structure central/regional interactions did not solve the

disfunctionalities created by the 1978 Constitution, namely the ambiguity of the distribution of

competencies between the centre and the regions, and the heterogeneous powers conceded to the regions14.

25

This fact partly undermines the functional explanation of the entrance of new organizations in the

state domain of power, which would rather predict the triumph of central attempts to impose control from

above as well as a homogeneous decentralization to all regions together with an increased functionality of

the new institutional framework. An interesting piece of evidence to support that argument can be found in

the study of John A. Agnew (1990) of the causes of political decentralization in Italy. Parting from fairly

different premises, Agnew arrive at similar explanatory factors to account for the entrance of new regional

organizations in the central state's domain of power, also rejecting, with similar arguments, functionalist

explanations.

In this respect, the influence of Spanish regional political parties in the policy process can be

plausibly explained by the same factors accounting for the constitutional decentralization of the state: the

existence of intense, distinctive identity and preferences in nationalist communities, which were eager to

undertake political mobilization in the defence of their nationalist claims; the emergence of political

organizations able to exert active pressure upon the centre in defence of their constituencies' distinctive

interests; and finally, the fact that a majority of the general public, and an important part of central political

elites, tended to consider those intense distinctive preferences as politically legitimate due to the historical

coincidence of repressive centralism with authoritarian governments, and regional decentralization with

democratic regimes.

In this respect, it is important to note the problematic nature of devolutions of central state power

to other political organizations pressing to enter the state domain, derived from the legitimation

requirements of political representation in democratic societies. Neocorporatist writers have rightly

remarked that the reasons why their entrance is problematic lay in that it threatens two fundamental

'normative complexes' of western societies: (i) ‘the normative basis of state authority’, that is, ‘the

universality of its legal order’, or in other words, ‘its pretence to the universalistic, legal-rational treatment

of citizens’ (Schmitter, 1986: 44, 61); and (ii) the normative basis of political democracy, which entail that

any departure from majority rule (i.e., the entrance of new political organizations in the sphere of the state)

should be ‘compatible with existing citizens expectations, or...potentially capable of altering those

expectations to their favour’ (Schmitter, 1986: 62).

In other words, the fundamental normative principles underlying political representation in

democratic societies imply that the legitimate power to enact public policy is in the hands of elected

political representatives backed with a majority of the votes. Such a distribution of legitimate power is

based on a theory of democracy which defends the existence of a national general interest likely to favour

social welfare for all citizens. But from the historical emergence of democratic regimes, the central problem

of that theory of democracy is the fact that those more or less nation-wide interests do not reflect all the

plurality of interests of the electorate. Or, in other words, that the existence of central representative

institutions at the national level is not sufficient for democratic representation, because it seems likely to

26

keep a wide range of plural social interest outside the political sphere (Pitkin, 1985).

In sum, the imperatives of maintaining the legitimation of both the state authority and the

democratic regime will render problematic any delegation of such monopoly representation rights conceded

by the majority rule, which will not occur spontaneously nor as a response to functional policy requisites.

Rather, changes in the institutional distribution of legitimate power are likely to be the result of the

existence within nation-states of broad social groups with distinctive identities and preferences, and with an

ability to defend them with a specific intensity against the legitimate power of majority rule. The existence

of such groups will threaten in itself the legitimation of the state as the guarantor of the general interest,

and ultimately, the legitimacy of the democratic regime.

However, although the existence of such groups is a necessary condition to open the domain of

power of central state, it is not sufficient. In the first place, those distinctive, intense preferences have to be

articulated in political organizations that represent them, and are able to exert pressure upon the central

state in order to make both factible their institutional access to the state domain, and visible the potential

legitimation losses of their exclusion. Furthermore, and in accordance with Jacobs claims, the access of

those interests to the state sphere of power will only be guaranteed if the majority of the general public

consider their access as legitimate, thus reinforcing, instead of threatening the normative bases of state

authorities and the democratic regime.

In the second place, the dynamics of health care reform in Spain contributes to clarify the role of

intense political preferences as powerful determinants of institutional change. Firstly, the failure of health

care reform during the period 1976-1983 illustrates that the extensive national and international

preferences for increased intervention of the state in the health care sector were not sufficient to foster

policy change. Such preferences were not defended with sufficient intensity by the centre-right party in

office, UCD, mainly for two reasons.

First, because positive national and international experiences with public institutions were not fully

compatible with the ideology of the centre-right governing party, which tended to favour the role of the

private sector. Second, the economic crisis and the parallel fiscal crisis of the Social Security system

weakened the capacity of the state to undertake major institutional reforms, specially in a context in which

all the efforts were focused on the building of democratic institutions, which was understably considered as

the political priority of the period.

The same negative evaluation of the financial and institutional capabilities of the state to launch

major institutional reform in the health care sector was present in the first socialist government, so

explaining the limited version of the initial NHS model introduced in the General Health Law. In this case,

however, financial considerations did not fully block the reform due to the intensity of preferences of a

significant section of central health care authorities, derived from the compatibility of both public

preferences and the dominant international policy paradigm with their own ideological positions.

27

The contrast between the socialist period and the UCD one emphasizes that broadly similar state

capacities are subject to fairly different subjective interpretations depending on ideology and political

priorities of state actors. Therefore, subjective evaluation seems to weigh more than objective assessment

of state capacities in the explanation of institutional change. In addition, contextual factors such as the

economic cycle and international commitments seem to be more influential determinants of institutional

reform than the factual organizational or fiscal capacities of state structures. In addition, the success of the

Catalan health care reform illustrates that major institutional reform does not automatically follow from

strong state structures. Rather, positive national experiences with private institutions, combined with the

existence of a coherent and widely shared international paradigm stressing the role of the private sector can

also lead to major institutional change. In other words, it is precisely the weakness of state structures, rather

than their strength, what facilitates institutional reform.

Moreover, the Catalan case also illustrates the role of ideology in facilitating a major shift in policy

goals. In this respect, the centre-right ideology of the party in office facilitated the early enactment of the

internal market paradigm, while the social democratic positions of the socialists, together with positive

national experiences with state institutions, contributed to block central attempts at reform during the 90's.

Furthermore, the success of the Catalan reform, in contrast with the failure of UCD's attempts, emphasizes

that the availability of a coherent international paradigm compatible with the ideology of the party in office

facilitates institutional change. In this respect, the lack of a consistent, suitable paradigm in the early 80's

contributed to block the UCD goals of reform while delaying the Catalan reform until the end of the 80's.

Finally, the recent failure of the Popular Party’s attempts at reform further suggests that intense

government preferences for institutional reform baked by a widely accepted international paradigm are not

sufficient to foster change in the absence of extensive public support for the new institutional model.

The dynamics of health care policy during the 90's also allow to draw some conclusions on the

consequences of regional decentralization upon efficiency and equity in health care policy. With respect to

efficiency, the empirical evidence on health care policies in Spain suggests that the regions seems to be

much more dynamic than the centre at reforming formerly inefficient services, at introducing policy

innovations and at promoting policy implementation15. As regards equity, and against pessimistic

expectations of increasing differences in policies and in the treatment of citizens across territorial

boundaries, the evidence underlines a process of diffusion of policy innovations, what in the last analysis

might involve a redistribution of knowledge and expertise from the richer regions to the poorer ones. Such

trends are not only perceptible in the field of health care, but also in the field of social services, both in

Spain and in Italy (see the contributions by Fargion, and by Aguilar and Laparra in this issue). Although

formal policy shifts may not affect equally all regional health care services because of varying political

circumstances, empirical evidence in Spain suggests that a substantial amount of convergence takes place

through informal processes such as intergovernmental cooperation, electoral pressures, professional

28

socialization, imitation of models of best practice, and sharing of experts across territorial administrations.

The relative influence of those factors remains an open question for future research.

CONCLUSIONS: THE SPANISH CASE IN COMPARATIVE PERSPECTIVE

An important question not answered in the above pages is whether the Spanish case shares some of

the specific traits of other Southern European welfare states. In a recent article, Ferrera proposed that a

common feature of the reform of health care systems in Greece, Italy, Portugal and Spain was the formal

commitment to the British NHS model, ‘characterized by open and free access to all residents, standardizes

rules and organization, tax financing’ (Ferrera, 1996). According to Ferrera, those institutional

developments were the result of the pressure exerted by strong communist and socialist parties, baked by

deep-rooted leftist sub-cultures. In this respect, the empirical analysis of the Spanish case clearly confirms

Ferrera’s insights. However, Spain seems to be distinctive in that both centre-right and right-wing parties

also supported the same objectives, although their intensity of preferences for the proposed institutional

reform was in general lower than in the case of leftist parties. An additional explanatory factor emerging

from empirical evidence in Spain is the wide opinion given by public opinion, the medical profession and

the trade unions to the reform proposals.

The second common characteristic of Southern European health care sectors is the implementation

gap derived from the lack of application of those formal commitments to institutional change. Ferrera

defends that in spite of the constitutional and legal measures enacted, the commitment of Southern

European governments to apply the reform in practice was only ‘half-hearted’, mainly due to the weakness

of state institutions, the absence of ‘an open, universalistic culture’, and the relative economic

underdevelopment of most of these countries. Although this may be generally plausible, the different

among countries seem to be marked in this respect. Universal access to health care was completed in Italy,

and nearly completed in Spain, while a dualist health care system seems to be still dominant in Portugal

and Greece (see the contributions by Symeonidou and Gubentief in this issue. Also, and at least in the case

of Spain, an important, successful effort to standardize the rules and organization of health care institutions

was made since the late 1980's, while the percentage of tax-financing rose from 25% to almost 80% as a

result of the implementation of the health care reform.

The analysis of the Spanish case also suggests that the crucial explanatory factors of the 'half-

hearted' approach to the implementation of institutional changes might have more to do with contextual

factors prevalent at the international level than with politico-institutional factors specific to the Southern

European countries. In particular, the change in the dominant policy paradigm at the international level

which takes place in the mid-eighties probably contributes to block the implementation of the reform in this

29

fourth countries, all of them 'late-comers' with respect to the adoption of the NHS model. The theoretical

framework developed in the above pages will suggest that the change in the dominant policy paradigm will

decrease the intensity of political leaders’ preferences for the institutional change, thus justifying the ‘half-

hearted’ approach to implementation discussed by Ferrera.

A second, related contextual factor which may explain the implementation failure seems to be the

change in the economic cycle. Usually, the enactment of reforms requires a favourable political context,

while their implementation requires favourable economic conditions. The expansion of the role of the state

in health care was launched in most Western European countries in a favourable political and economic

period. However, in Southern Europe, the implementation of the same reforms was initiated in a period of

economic recession, while their growing international compromises, linked to membership in the European

Community, set a clear political limit to expansive macroeconomic policies.

Those changes in the international context may also help to explain the maintenance of a sizeable

private health sector contracted-out with the public system in Southern European countries, in spite of the

formal NHS model adopted. In this respect, the Spanish case seems to be also a little bit different in that

only 15% of the public health care expenditure was channelled through private health care centres in the

1990's, while the equivalent figures in Portugal and Italy were 40% and 37,5% respectively. Also, the

percentage of total health care expenditure financed by the private budget was below near to 15% in Spain

in the late 1980's (Murillo et al., 1996), while the equivalent figure in Greece was higher than 40% (see

Symenonidou’s contribution in this issue). This unique feature might be due to the fact that the expansion

of the public network of health care centres took place in Spain during the 1960's and 1970's, in a context

of unprecedented economic growth and dominance of a policy paradigm which favour the expansion of

state institutions.

In the same vein, the Spanish case seems to be a little bit deviant regarding the most recent wave of

reforms experimented by Southern European health care systems. A remarkable feature shared by Italy,

Portugal and Greece is the rapid incorporation of some of the reform measures recently launched in most

Western welfare states, which tend to expand the role of private providers and financing within the health

care sector (see the contributions by Granaglia, Guibentif and Symeonidou in this issue). This rapid move

seems specially surprising given its role as late-comers with respect to the former policy paradigm. Again, a

potential explanation here might be the combination of political leaders’ intense preferences for the new

international model of institutional change, together with extensive public preferences for a deep reform

along the same lines, reflecting negative national experiences with the operation of public health care

institutions.

However, similar reform proposals have been blocked in Spain until now. In contrast, the line of

reforms predominant during the 1990's is much more moderate, and seem to be oriented to increase the

efficiency of the public sector rather than to decrease its size and role vis-a-vis the private sector.

30

According to the theoretical arguments developed in the above pages, a potential explanatory factor here

might be the higher preferences for public health care institutions showed by Spanish public opinion

compared with other Southern European countries. In this sense, in 1996 the percentage of citizens stating

that health care runs well or need only minor changes represents in Spain 47, 2% of the population, while

the equivalent figures in Italy, Portugal and Greece are 19,1%, 24,1% and 29,7% (Le Grand, 1996).

This might imply that the challenges that Southern European public health care systems will face

in the next future might also be a little bit different in Spain. In particular, the structural crisis of the

welfare state pointed out by Farrera might affect less strongly the Spanish health care sector than the rest of

Southern European countries. An additional factor that may soften the pressures to dismantle the public

health care system in Spain is its deep political decentralization to the regions. In fact, the empirical

evidence suggests a remarkable commitment of regional authorities to improve and expand public welfare

services, both in the field of health care and in the related field of social services and minimum income

programmes (see the contributions by Fargion, and by Aguilar and Laparra in this issue). This trend is

specially noticeable by way of contrast to recent central government policies, mainly focused on cost-

containment and cutting down of welfare services.

NOTES

31

32

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1. In fact, the success of Basque and Catalan political parties in blocking the LOAPA strengthened their leadership within their own

regions; the electoral share of the Catalan nationalist party (CIU) increased from the 23% obtained in the local elections held in the first

months of 1983 to the amazing percentage of 47% in the regional elections of 1984, while also the Basque nationalist party (PNV) increased

their share between the same electoral periods, although the increase was as modest as of two percentual points (EL PAIS: Anuario 1984).

2. Public coverage increases from 25% in the forties to 50% in 1965 (INP, 1977: 169). The changes introduced from 1962 on, which

involve the elimination of the condition of low-income to get access to the system and begin to be applied in 1967 (Guillén, 1995), expand

the percentage of the population covered by thirty percentual points, with public coverage rising to 80% in 1975 (INP, 1977: 169).

3. In this sense, the evolution is most remarkable. On the one hand, while in the forties only 3% of public health care was provided by state-

owned health care centers (de Miguel, 1979), in 1975 three fourths of the public health care budget were spent by public providers, and only

one fourth by private ones (INSALUD, 1978). This is a differential feature of the Spanish health care system, for Social Security systems do

36

not usually develop their own network of centers.

4. The Catalan communist party (PSUC) exerts a considerable pressure upon central government to launch the process of health care reform

in the Parliament; see, for instance Boletín Oficial de las Cortes Generales. Congreso de los Diputados (BOCG), 1978, 1980, no. 169 y

180 and Diario de Sesiones del Congreso de los Diputados (DSCD), 24 May 1979, no. 11: 481-497. In spite of the early alternation

between government and opposition in Catalonia, Catalan communist policy experts remain in their posts for a long while within the

Department of Health, due to the lack of expertise of the Catalan right-wing party in office, Convergence and Union (Convegencia i Unió,

CiU) (Cernadas, 1994). Finally, in 1983 a Catalan socialist Health Minister is appointed by the central socialist party, PSOE. During his

mandate, several communist and ex-communist occupy positions within the Ministry (Diario de Sesiones del Senado, DSS, 26 February

1986, no.149: 7000).

5. Those conflictive dynamics were predominant between 1981 and 1986, for the following reasons. On the one hand, the attempts made

by Basque and Catalan political representatives to increase their competencies at the expense of the center (taken advantage of the absence

of basic state law); on the other hand, the parallel central undertakings to hierarchically impose its coordination and planning prerogatives at

the expense of regional governments' autonomy. This attempts at increasing their respective share of power were made possible by the afore-

mentioned ambiguity characterizing the 1978 Constitution. In response to each other's belligerent undertakings, a total of 76 appeals to the

Constitutional Court were lodged with respect to health care matters between 1981 and 1986, out of which 43 were posed by the central

government, and the remaining 35 by the CAA, mainly by the Basque and Catalan political representatives (García Vargas, 1988: 57).

6. See Conflictos positivos de competencias nos. 92/1982 and 95/1982, promoted by Catalonia and the Basque Country respectively; and

Sentencias Tribunal Constitucional nos. 32/1983 (28 April) and 42/1983 (20 May).

7. However, the doctrine elaborated by the Constitutional Court also recommended the creation of corporate bodies and a greater central

audience to regional claims to favour coordination of central and regional political representatives. In this sense, it is important to remark

that the role played in the open central/regional confrontations by the Constitutional Court substantively contributed to promote the softening

of conflicts, and the possibilities of future understanding among central and regional authorities (De Carreras, 1992: 8; Terrón and Camara,

1990; Cruz, 1990; Salas, 1988).

8. See Ley 9/1983 (19 May) sobre el Servicio Vasco de Salud and Ley 12/1983 (14 June) de Administración Institucional de la Sanidad, la

Asistencia y los Servicios Sociales de Cataluña. Although the Basque Country will not obtain health care transfers until 1987, it was able to

enact the crucial regional health care law in 1983 thanks to the authorization of the central Ministry of Health, which also determines the

support given to the law by the Basque Socialist Party (see declarations of the socialist Minister Lluch in DSCD no.215, p.9873, 11 June

1985).

9. See Royal Decree 400/1984 (22 February). The combined effect of Basque and Catalan health care laws, and of the devolution to

Andalusia made 1984 the most conflictive year of the period 1980-1986: 33% of the total of constitutional appeals posed during this period

corresponds to 1984 (García Vargas, 1988: 58).

10. The best piece of evidence supporting that the introduction of changes in the final draft was made a few days before the parliamentary

process started is the economic report attached to the draft within the Parliamentary documentation (Expediente Ley General de Sanidad,

legajo 2766, carpeta 1)

11. The nature and extent of ideological differences is illustrated in by the declarations of Enrique Múgica, a prominent Basque socialist

leader: 'The autonomous communities are unstoppable and it is all about letting us who believe in the autonomous communities work,

because I am sure that jacobinism will not triumph in this country. The modernization of the state requires its non-uniformity. Nonetheless,

I am aware that my position is not majoritarian within the leadership of my own party, yet without the complete integration of the Basque

Country and Catalonia, we cannot talk seriously about the governability of

Spain' (DSCD, no.246: 11098, 7 November 1985).

12. The evidence about the frustrated reform of the reform comes from an exhaustive analysis of the press archives of the Ministry of

Health, which includes the main daily and weekly papers at the central and regional level. My own analysis of those archives covers from

December 1990 to September 1992. I am grateful to the Departament of Press of the Ministry for the support given to my research.

13. The contract is also introduced in Andalusia, the Basque Country and Galisia (González López-Valcárcel et al., 1995: 11), while the

system of prospective funding is introduced in those three regions plus Valencia (Martín, 1993). For a detailed analysis of the excellent

results achieved by the new system of prospective hospital funding introduced in Valencia en 1991 see Peiró (1992), quoted by Ortún, V.

(1993). For a comparison between the central contract and the regional ones see Puertas et al. (1995).

37

14. A remarkable change with respect to the constitutional framework refers to the extended participation of the 'standard' regions.

Although they do not get health care jurisdiction, the General Health Law guarantees their participation in the management of the regional

health care services through the creation of joint regional/central committees in each region.

15. In this respect, the results of a Delphi survey conducted among a small sample of health care experts in 1995 support the main

conclusions of the paper: 80% of the experts considered that health care transfers had positive effects, mainly in that it improved policy

innovation and dynamism as well as health care management (Herce et al., 1995: 3).