My book, Banking on Health: The World Bank and Health Sector Reform in Latin America addresses the puzzle of why the World Bank was unable to effect sweeping neoliberal reforms in health in Latin America in the 1980s and beyond. Through the use of quantitative, regional data and case-study interview and archival data collected over a year of fieldwork in Argentina, Costa Rica, and Peru and the World Bank archives in Washington DC this book argues that the answer to this puzzle is twofold. First, the World Bank is not a uniformly neoliberal, monolithic hegemon in health, pushing markets and privatization on states. Second, countries’ autonomy and capacity in health—that is, whether a clear agenda for the national health system, and ability and resources to carry these plans out—shape how the World Bank is involved in health sector reform across countries. The book distinguishes between neoliberal ends and means, providing some analytic clarity for what neoliberalism means in health sector reform and how Banking on Health has changed over time. This book intervenes in current debates on global governance, international institutions, neoliberalism, and global health and should be of interest to sociologists, political scientists, health economists, Latin Americanists, and development, international studies and public health scholars.
Chapter 1, The World Bank, Development, and Health
This chapter presents the research questions and theoretical framework guiding the book’s analysis of the World Bank’s involvement in health sector reform in Latin America. This chapter introduces the central puzzle guiding the book: how is it that the World Bank, viewed as a neoliberal hegemon was unable to effect sweeping market-oriented reforms in the region mired by economic crisis and recession and needful of external funding? I set up the theoretical framework that guides the book, drawing from the literatures on global governance, neoliberalism and the Washington and possible post-Washington consensus, and health systems research. I introduce the concepts of state autonomy and capacity in health as well as the paradigmatic goals (equity and efficiency) and policy instruments (in particular, I examine 1. decentralization and deconcentration, 2. performance-based financing, 3. separation of functions across and within institutions, 4. targeting, 5. private sector involvement and 6. primary health care model) framework which guides my analysis. I discuss my research design, and provide historical background on the health sectors of Argentina, Costa Rica, and Peru’s in order to contextualize these countries’ different responses and episodes of health sector reform between 1980 and 2005, setting the stage for the developments discussed in the book.
Chapter 2, Neoliberalism and the World Bank’s Changing Approach to Health
The second chapter places the focus more fully on the World Bank and examines its changing approach to health. I trace the World Bank’s discussions of health in its policy documents, starting in 1980 when the World Bank formally committed to direct involvement in health projects and loans. I discuss criticisms of and the Bank’s response to these critiques of structural adjustment approaches that promote economic growth and often mandate cutbacks in public safety nets. I discuss the seminal 1993 World Development Report on health and the 2004 World Development report on improving services for poor people. I catalogue an increasing emphasis in the Bank on outcomes and systems. I trace both continuity and shifts in the World Bank’s work in health, a return to the lost focus on equity in the interest of poverty amelioration and economic growth via investments in human capital, an enduring concern with efficiency, and relatively stable financial commitments to health since the 1990s. This chapter concludes by discussing the Bank’s recent renewed discursive commitment to universalism in health, questioning how and whether it will play out in deed.
Chapter 3, The State of Health in Latin America: Trends and Correlates of Health Expenditures
Chapter three draws on quantitative data to examine the trends and correlates of health expenditure, including overall expenditure, the public-private mix of health expenditure, and public health expenditure compared to other public expenditures in Latin American countries. This chapter sets the stage for the three country case studies. The quantitative analysis reveal that overall, public health expenditure in Latin America has been on the rise, and that World Bank conditions attached to these loans do not have a statistically significant effect on health expenditure across a variety of measures in Latin America. Does this mean that the World Bank and other international financial institutions do not matter for health financing and health sector reform in Latin America and the Caribbean? The answer is more complicated. This chapter simultaneously contradicts some established notions of IFIs acting as neoliberal agents, driving down public expenditure and programs, and establishes the possibility of a non-unitary, contingent effect of World Bank work in health across countries, confirmed in the following country case-study chapters.
Chapter 4, Argentina: Mixed Outcomes While Coping with Crisis in a Planner State
Chapter four traces the process of health sector reform in Argentina between 1980 and 2005. The chapter interrogates how and why the World Bank became involved in health sector reform in Argentina, the country with which the Bank has had the most extensive, and many would argue successful, relationship in health in the region. In 1989, then Argentinean health minister, Aldo Neri, with support from the federal government, attempted to introduce a universal public health system. This reform failed, largely due to opposition by the trade-based insurance funds that dominate the Argentinean health market, the Obras Sociales. In this chapter I examine the reforms that the government pursued in the aftermath of this failed reform, and how World Bank’s involvement shaped the direction of future reform in the context of this health system and the broader political and macro-economic national realities. Drawing on World Bank project and loan documents on national health plans and documents together with over two dozen interviews with policy makers, civil society activists, World Bank personnel, and other experts I find that the World Bank advanced an agenda of targeted interventions in the context of a fragmented system. This chapter describes Argentina as a planner state: characterized by a capable technical expertise and an ambitious health reform plan, but an inability to carry out broad reforms because of divisions within the health system and powerful opposing actors. I conclude this chapter by discussing the implications of this case for our understanding of the ways in which high national autonomy and but weak state capacity in health (the case of Argentina) conditions how international financial institutions and other organizations can affect health sector reform.
Chapter 5, Peru: Slow, Steady Health Reform in a Weak State
Chapter five focuses on health sector reform in Peru, which is a prototypical “weak state” in health. It is characterized by weak autonomy – no clear health goals, and weak capacity – little infrastructural, technical, and other ability to carry out health reforms, programs and goals in the 1980s and beyond. Peru then, is the case in which we expect the sharpest neoliberal shift, as it is most vulnerable to international pressures and social program cutbacks. Surprisingly, this case displays the opposite trend: the expansion of public health financing, and coverage, though provision is sub-contracted, sometimes to private providers. This case spotlights the complexity of understanding what neoliberalism means for health. The relatively recent Seguro Integral de Salud (SIS) aims to create an overarching publicly regulated health insurance in Peru though many of the functions: provision, financing, and delivery are left to the private sector. Of the three cases, Peru also demonstrates most clearly the ways in which the logic of economic productivity and human capital are used to advance health. The World Bank, via its support of the precursors to the SIS—the maternal insurance and school children insurance instituted under Alberto Fujimori’s dictatorship—has played a key role in these reforms and seemingly supports the expansion of government provision of health insurance. The Peruvian case demonstrates that this extension is grounded in theories of human capital in the service of economic efficiency, and that it advances the government’s coordinating and regulatory role. This calls for a reconceptualization of neoliberal reforms that do not always reduce the role of the state, but rather transform it, together with the expansion of the role and presence of private providers. This chapter demonstrates, however, that even in a weak state movement towards universal care, albeit in a segmented way, is possible. Peru then embodies the paradox of the strength of weak states: the central apparatus cannot be entirely co-opted for neoliberal ends because it is too disorganized and segmented to co-opt, and shows the World Bank’s support of movements towards universal insurance, albeit in the context of fixing market inefficiencies.
Chapter 6, Costa Rica: The Challenges of Maintaining Universalism in a Strong State
Chapter six, the final country case-study chapter, focuses on Costa Rica, the quintessential “strong state” in health. Costa Rica distinguished itself from many other Latin American countries by being a leader in terms of both initiatives and outcomes in health and other social domains. Touted as a story of “health without wealth” it boasts life expectancies and an epidemiological profile more similar to those of advanced welfare states than its regional neighbors. However, it has faced difficulties in the continued financing of its universal system which draws from employer, employee, and government subsidies for the poor. Because of increasing costs associated with chronic illnesses and new medical technologies the Caja (Costa Rican Social Security agency) has found itself needing to readjust its structure because of budget deficits. The challenge for the Costa Rican health system is maintaining (rather than establishing) universal coverage and it has drawn on World Bank funds for some of its most important reforms, including the creation of primary health teams and centers (EBAIS) in the mid-1990s. This chapter demonstrates that even strong states in health—with high autonomy and capacity—face challenges, particularly budgetary constraints because of the changing landscape of diseases and health technology. Harkening to the theoretical framework of the book this chapter demonstrates that even in strong states, with solidary, redistributive health systems, the market can offer some solutions to inefficiencies. The World Bank and other international financial institutions can play helpful advisory and funding roles even in such strong states, given the reality of skyrocketing healthcare costs, extended life expectancies, and the increased prevalence of chronic diseases.
Chapter 7, Banking on Health: Variable Approaches and Contingent Outcomes
The final chapter synthesizes the information gleaned from quantitative, regional analyses, which do not indicate a downward effect on health expenditures by the World Bank in Latin America, and from qualitative, country case analyses, which reveal that the World Bank’s operates differently across countries, in interaction with national contexts. Health includes not just financial and monetary management but also stands at the core of citizen-state contracts, welfare politics, national and individual identities, and is therefore a more complex field of analysis. As such, our understanding of what neoliberalism in health means deserves important attention. All countries are looking for cost-cutting, efficiency enhancing measures with burgeoning healthcare costs and aging populations. The World Bank’s work in health utilizes what many consider neoliberal tools and instruments (e.g. targeting, decentralization) but sometimes in the interest of universalism and equity. I argue that state capacity and autonomy shape the World Bank’s interest in and the substance of its involvement in health across countries, sometimes in surprising ways. The chapter concludes by highlighting the book's contribution to our empirical, conceptual, and theoretical understandings of welfare state development, neoliberalism in health, the World Bank, and health sector reform.
Methodological Appendix, Comparative, Mixed Methods Research: Challenges, Opportunities, and Some Practical Tips
In the appendix I describe my data and methods. I provide information on the descriptive statistics and regression methods and robustness checks utilized in the analysis of quantitative data on health expenditures. I then discuss my case-selection strategy as well as how I gained access to my key informants and policy documents and their sources and how I gathered, and analyzed the country-case data. I provide details on my interview instrument. Specifically, I provide more information about access and confidentiality with government officials and other key informants, and the benefits of using a mixed-methods approach where qualitative and quantitative data provide a more complete examination than either separately. I also provide some practical tips for those hoping to undertake this type of research, outlining the rewards and challenges of mixed-methods, comparative, and in particular cross-national, research.
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