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Relationship Between Fiscal Decentralization and Health Care Financing in Uasin Gishu County, Kenya

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ABSTRACT

This study examined the relationship between fiscal decentralization and health care financing in Uasin Gishu County Kenya, the researcher sought to answer the following research questions; To what extend does the adequacy of decentralized funds influence health care financing in Uasin Gishu County Kenya? How effective was health management team in influencing health care financing in Uasin Gishu County Kenya? How does budgeting and allocation of decentralized funds affect health care financing in Uasin Gishu County Kenya? Lastly, what were the effects of decentralized fund expenditure on health care financing in Uasin Gishu County Kenya? The researcher used ex-post facto research design. Both stratified sampling and random sampling technique was used to select the respondents. The target population for the study was 98 employees working in health department with a sample size of 79 respondents whom comprised of permanent health workers working in the major hospitals in the county. Questionnaires were employed as the major data collection tools. Data were analysed through descriptive statistics and hypothesis is tested by use of chi square. The analysis of the data was done with Statistical package for social science (SPSS) version 20 and the data was presented though use of graphs and tables for clear understanding of the results. The findings from the study therefore rejected the null hypotheses and concluded that there exists statistically significant relationship between adequacy of decentralized funds, management effectiveness and budgetary mechanism and the level of health care financing. This means that whenever the health management team are effective in managing the decentralized funds well, there is an increase in the level of health care financing.

Keywords: Fiscal Decentralization and Healthcare financing

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Relationship Between Fiscal Decentralization and Health Care Financing in Uasin Gishu County, Kenya

  1. 1. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 Triple A Research Journal of Social Science and Humanity (ISSN: 2636-5472) Vol. 2(1): 001 - 014, June 2018 Available online: http://www.triplearesjournal.org/jssh Article Id: JSSH.2018.101 Copyright ©2018 Triple A Research Journal Full Length Research Paper Relationship Between Fiscal Decentralization and Health Care Financing in Uasin Gishu County, Kenya Dr. Gideon Omwono* and Alfred Kandie Keitany The Catholic University of Eastern Africa, Gaba Campus Eldoret, Kenya Corresponding Author *Dr. Gideon Omwono The Catholic University of Eastern Africa, Gaba Campus Eldoret, Kenya Email Address: gedion.impact@gmail.com ABSTRACT This study examined the relationship between fiscal decentralization and health care financing in Uasin Gishu County Kenya, the researcher sought to answer the following research questions; To what extend does the adequacy of decentralized funds influence health care financing in Uasin Gishu County Kenya? How effective was health management team in influencing health care financing in Uasin Gishu County Kenya? How does budgeting and allocation of decentralized funds affect health care financing in Uasin Gishu County Kenya? Lastly, what were the effects of decentralized fund expenditure on health care financing in Uasin Gishu County Kenya? The researcher used ex-post facto research design. Both stratified sampling and random sampling technique was used to select the respondents. The target population for the study was 98 employees working in health department with a sample size of 79 respondents whom comprised of permanent health workers working in the major hospitals in the county. Questionnaires were employed as the major data collection tools. Data were analysed through descriptive statistics and hypothesis is tested by use of chi square. The analysis of the data was done with Statistical package for social science (SPSS) version 20 and the data was presented though use of graphs and tables for clear understanding of the results. The findings from the study therefore rejected the null hypotheses and concluded that there exists statistically significant relationship between adequacy of decentralized funds, management effectiveness and budgetary mechanism and the level of health care financing. This means that whenever the health management team are effective in managing the decentralized funds well, there is an increase in the level of health care financing. Keywords: Fiscal Decentralization and Healthcare financing INTRODUCTION Background to the Problem Fiscal decentralization refers to the process of devolving responsibility to lower level of government in accordance with these local needs and preference used in decision- making. Vander Naald (2007) opines that decentralization is a mechanism to make policy more responsive to local needs and to improve populace in processes of democratic governance. A working definition of decentralization is that by Faguet (2004) who defines it as the devolution by central government of specific functions with all the administrative, political and economic attributes that these entail, to democratic local (for example municipal) governments which are independent of the centre. Fiscal decentralization has been an integral part of overall public-sector reform in many countries, both developed and developing, and consists primarily of reassigning expenditure functions and revenue sources to lower tiers of government. The view by policy makers is that fiscal decentralization will improves efficiency, reduces operational costs, and improved public-sector performance in service delivery. On the other hand, the pitfalls of decentralized provision and fiscal policy-making
  2. 2. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 Gideon and Alfred 002 consist, in general, of loss of control over sub-national finances and coordination failures in fiscal policy-making, often leading to pressures on sub-national finances and, ultimately, macroeconomic stability. Overall, the merits of fiscal decentralization have to be weighed against the risks involved in increasing sub-national spending power at the expense of higher levels of government (De Mello, 2000). Decentralization, involves a variety of mechanisms to transfer fiscal, administrative, ownership and political authority for health service delivery from the central Ministry of Health (MOH) to alternate institutions has been promoted as a key means of improving health sector performance. Due to decentralization, many sub national governments have become key public-sector actors. As such, their helps have grown and expectations placed on them have increased (World Bank, 2003). In most developed countries, health care is largely paid for by the government or an organization associated with it, using taxes collected as a “single payer” system in which the government pays directly for care. In France and Germany, the government collects taxes to fund part of the government healthcare system, and employers and individuals pays for the remainder of costs directly. Provision of health care services in Kenya is through the public and private sector, with the central government through the Ministry of Health being the largest provider (Nafula et al., 2004). The health service delivery function was formally transferred to counties on August 9, 2013, and one-third of the total devolved budget of Kenya Shillings 210 Billion was earmarked for health in the 2013/2014 budget following this transfer (Kenya Health Policy, 2014.) Proposed Kenya health Bill 2014, establishes a unified health system, to coordinate the inter-relationship between the national government and county government health systems, to provide for regulation of health care service and health care service providers, health products and health technologies and for connected purposes. However, the devolved governance structures in the county health governments have not managed in delivery and provision of health services (GoK, 2014). Statement of the Problem Fiscal decentralization on health care services was expected to bring in an improved a locative efficiency by allowing the mix of services and expenditure to be shaped by local user preference, also expected to improve technical efficiency through cost consciousness at the local level, and service delivery innovation through experimentation and adaptation of local conditions (World Bank, 2003). However, fiscal decentralization on health care financing has resulted into many challenges which has led to management dilemmas including; high turnover on health workers who join private hospitals, there is poor service delivery due to low quality of medical drugs being procured by the counties. There is poor budgeting and allocations of funds since priorities are not set right, there is slow procurement of commodities because of bureaucracy in procurement system and rampant health workers strikes Various studies have been done on fiscal decentralization in many countries in the world, many of which have used panel data as the research design. Study by Bossert et al., (2000), on applied research decentralization of health of Latin America case study of Colombia found that improved a locative efficiency, through permitting mix of services to be shaped by local preferences, improved production efficiency through greater cost consciousness at local level, and improved quality, transparency, accountability and legitimacy owing to user oversight and participation in decision making. Another study done by Jutting, & Hiroko (2007), on fiscal decentralization Chinese style: good for health outcome found that counties in more fiscally decentralized provinces have lower mortality rates than counties where the provincial governments remains spending authority if certain conditions are met. Therefore, fiscal decentralization can lead to efficient production of local public goods. However, Bodman et al., (2009) on the study of fiscal decentralization on macroeconomic conditions and economic growth in Australia found that important understanding was more than just the effect of decentralization on any facet of an economy. None of the study has been carried out in Uasin Gishu county Kenya. Therefore, this study investigated the relationship between fiscal decentralization and health care financing in Uasin Gishu county Kenya. Research Questions • To what extent does the adequacy of decentralized funds influence health care financing in Uasin Gishu county Kenya? • How effective is county management in influencing health care financing in Uasin Gishu county Kenya? • How does efficient Budgeting and allocation of decentralized funds affect health care financing in Uasin Gishu county Kenya? • What is the effect of decentralized funds expenditure on health care financing in Uasin Gishu county Kenya? Research Hypotheses H1: There is a relationship between adequacy of decentralized funds and the level of health care financing. H2: There is a relationship between effectiveness of management of decentralized funds and the level of health care financing. H3: There is a relationship between efficient budgeting and allocation of decentralized funds and the level of health care financing H4: There is a relationship between level of expenditure of decentralized funds and the level of health care financing. Significance of the Study This study was of great importance in Kenya as well as
  3. 3. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 003 Triple A Res. J. Soc. Sci. Human. . majority of African countries since they are still at early stages of fiscal decentralization despite notable progress regarding political decentralization. The county government are not yet ready to play a meaningful role in health care financing. The results of this study gave some clarity on management of decentralized funds as well as setting priorities right as expenditure of decentralized funds are concern. Finally, this study was important to fellow researchers in relevant fields to add the information to their body of work. Significance to the County Health Management Team (CHMTs) The research study will help the management of the health department to get more insights on how to manage health care services and involve all the health stakeholders in the budgeting process. It will give the management the right priorities when allocating resources to the various activities in the health department, the department of health under devolved system has recently been faced with a challenge where its medical staff leave their work and join the private sector. This research will assist to come up with causes of these turnovers which help the management come up with solutions to gap this scenario. Significance to the Health Workers The health workers are the major people who are affected with fiscal decentralization of health care services; this is because they are the one who are to offer the health services to the members of the public. The researcher would like to use this study to give some recommendation to the management of the health department to provide a good working condition to the health workers to retain them and to boost their morale in order to provide good services to the members of the public. Significance to the Members of the Public The main aim of fiscal decentralization is to provide efficiency and improved services to the members of the public, this can only be achieved through a good management of the decentralized funds, the researcher used this research to know what the members of the public need to improve the services of the department of health this was to ensure that the management involve the members of the public in decision making through public participation. Theoretical Framework The researcher employed the classical theory in this study whose proponents are Oates (1972) and Tiebout (1956) who stated that fiscal decentralization can guarantee an efficient provision of public goods simply because local preferences are better satisfied than in the case of centralization. Decentralization is also thought to increase the likelihood that governments respond to the demand of local public population by promoting competition among sub national governments (Tiebout,1956). The reason why the researcher chose this theory was that it had all the concepts which helped to promote the concepts of fiscal decentralization that are accountability, transparency and efficiency. This theory helped the researcher to make a comparison between fiscal decentralization and health care financing. Conceptual Framework Independent variables Fiscal decentralization Figure 1. Conceptual Framework LITERATURE REVIEW Review of Different Theories The Classical Theory of Fiscal Decentralization The theorem hinges on the crucial assumptions that governments operate to maximize social welfare and that in case of centralization there is a uniform provision of public goods. Under this approach central governments do not maximize social welfare and operate like monopolists to increase their control over the economy’s resources. Therefore, on the crucial assumption that households and firms are mobile, splitting the central government in many local governments and introducing fiscal competition among them through a decentralized fiscal system should produce the same effect of explicit Adequacy of decentralized funds • Availability of facilities & equipment • Level of public satisfactions Health care financing • Timely distribution of funds • Quantity of the money Effective Management of decentralized funds • Level of project completion • Planning techniques Expenditure of decentralized funds • Audit report • Internal control systems Budgeting and allocation of decentralized funds • Previous budgets • Budget proposals • Involvement of stakeholders • Partners Dependent variable
  4. 4. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 Gideon and Alfred 004 fiscal constraints on the central governments taxing power. Traditional Theory of Public Finance This case is based on an improved allocation of resources in the public sector. And it has four basic elements. First, regional or local governments are in position to adapt outputs of public services to the preferences and circumstances of their constituencies as compared to a central solution, which presumes that one size fits all. Secondly, in setting of mobile households, individuals can seek out jurisdictions that provide output well suited to their tastes, thereby increasing the potential gains from the decentralized provision of public services. Third, in contrast to the monopolist position of the central government, decentralized levels of government face competition from their neighbours, such competition constraints budgetary growth and provide pressures for the efficient provision of public services. Fourth decentralization may encourage experimentation and innovation as individual jurisdictions are free to adopt new approaches to public policy, in this way, decentralization can provide a valuable “laboratory” for fiscal experiments. Second- Generation Theory of Fiscal Decentralization In this framework decentralization can reduce the information asymmetry, generating yard stick and tax competition among sub national governments and in this way the electorate can increase their control over the politicians, to stimulate more electoral accountability that finally translate into a more efficient government activity, because we can observe less rent diversion and less influence by lobbies. Criticism of Classical Theory of Fiscal Decentralization The classical theory of fiscal decentralization states that decentralization will solve the problem of efficient provision of public goods. However, it should be noted that decentralization reveal its dark side, especially in practice. It should be noted that the county government do not always provide uniform provision of public goods. This theory is not practical in that there is nothing preventing central government from obtaining the needed information on local cost functions and preferences. Criticism of Second Generation Theory of Fiscal Decentralization This theory studies the trade-off between centralized and decentralized provision in principal agent model of electoral accountability, where the electorates are the principal and the politicians are the agent in this way the electorate can increase their control over the politicians. However, in practice it is impossible to limit the benefits of locally public goods provided the specified region. RESEARCH DESIGN AND METHODOLOGY Research Design The research design adopted for this study was ex post- facto research design. This research design was employed because it was not possible to ethically or physically control the variables and was also not possible to conduct an experimental design on this study. The design was used to ascertain the relationship between fiscal decentralization and health care financing. Target Population The study targeted 79 employees from four hospitals in Uasin Gishu county department of health. The target population was chosen because they were the major hospitals in the county and could give information, which guided the researcher in making informed conclusion on the relationship between fiscal decentralization and health care financing (table 1 below). Description of the Sample size and Sampling Procedures The sample was obtained from the target population by grouping the health workers in groups as per the four major hospitals in Uasin Gishu county this is by use of stratified sampling, then the health workers was then picked by use of simple random sampling by picking the respondents from each facility. The sample is obtained as in table 2 below. Description of Research Instrument Semi Structured Questionnaire Data was collected using questionnaire which were both closed ended and open ended with two parts part one has section A which contained background information such as age of respondent, gender, level of education and number of year of experience. Part two had section B to E which was based on research question. =1 to strongly agree=5 Validity of the Research Instrument Results To ensure validity of research instrument the researcher used expert judgment; this was by relying on groups of individuals with specialist skill set, training or experience in the subject matter relevant to the activity being performed. Reliability of the Research Instrument The researcher enhanced the reliability of the data collected by use of test-re-test method by ensuring that
  5. 5. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 005 Triple A Res. J. Soc. Sci. Human. . Table 1: Target Population Facility Population category Uasin Gishu County Hospital 31 Ziwa Sub County Hospital 27 Huruma Sub County Hospital 19 Burnt Forest Sub County Hospital 21 Total 98 Source; County database (2015) Table 2: Sample size Facility Target population Sample size Uasin Gishu County Hospital 31 26 Ziwa Sub County Hospital 27 22 Huruma Sub County Hospital 19 14 Burnt Forest Sub County Hospital 21 17 Total 98 79 Source: County database (2015) the instrument was administered twice to the same sample of 8 respondents who was not part of the sample. Description of Data Analysis Procedure Data was analysed with two analysis techniques namely; descriptive analysis and inferential statistics. Descriptive analysis is the elementary transformation of data in a way that describes the basic characteristics such as central tendency, distribution, and variability. Once the descriptive analysis was done, the information was presented through various ways such as tabular format, frequency tables and frequency distribution tables (Statistical Package for Social Sciences (SPSS) was used as a tool in analysis. Hypotheses were tested using chi square. RESULTS Response Rate The study targeted79 employees from four hospitals in Uasin Gishu County, department of health. From the study, 59 out of the 79 sampled respondents filled in and returned the questionnaire contributing to 75%. Demographic Characteristics of Respondents This section shows the demographic characteristics of the respondents including respondents’ gender, age and job experience. Respondent Gender Figure 2 below presents the gender of the respondents. The distribution of the respondents is almost fifty-fifty with the male comprising 53% (31) of the total and the rest 47% (28) being female. The figures indicate that the study captured more male respondents than were female one and in addition, the representativeness of the sample in the study was elicited. Age of the Respondents The age of the respondents is presented in figure 3. From the results in the figure, 37.3% of the respondents are in the age bracket of 26 to 35 years, 23.7% are in the age bracket of 36-45 years, 22% of them are between 18 to 25 years and 16.9% of the respondents are in the age bracket of 46 to 55 years. With more than 60% of the employees in the public health care sector in Uasin Gishu County falling in between 26 to 45 years of age, it implies that the county health care finance sector has experience and knowledgeable staff. Experience Figure 4 highlights the job experience of the respondents. From the figure, 54.2% of the respondents have worked for a period of 5 to 10 years, 22% of them for less than 5 years, 16.9% of them have worked for over 15 years and 6.8% of the respondents have worked for 10 to 15 years. With more than 50% of the staff having 10 years’ experience, the public health care finance sector has the sufficient and experience staff who can ensure organizational continuity. Influence of Adequacy of Decentralized Funds on health care financing The statistics in table 3 below show the perceptions of the respondents on the issues concerning the adequacy of the decentralized funds on healthcare financing. The results indicate that 78% of the respondents affirmed that the decentralized funds were inadequate in financing the provision of the healthcare services, while 22% affirmed that the funds were adequate. This implies that the decentralized funds were not sufficient in aiding the county in providing the needed healthcare service or that the demand for the healthcare services outstrips the required funding and thus the inadequacy in funding. More than 76% of the respondents affirmed that the county health care service provision is deficient in
  6. 6. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 Gideon and Alfred 006 Figure 2. Gender of the Respondents Figure 3. Age of the Respondents Figure 4. Job Experience equipment and facilities, while 12% confirmed that there is adequate equipment and facilities. This indicates that the health care services have a shortage of equipment and facilities, which may be attributable to increased demand for the use of facilities. The public are dissatisfied with the county health care system as affirmed by more than 63 per of the respondents, while 12% could neither affirm or disaffirm the levels of satisfaction with a further 26% confirming that the public were satisfied. This may be attributed to the lack of adequate financing and shortage of equipment and facilities that can aid in improving service delivery. The percentage of the funds is inadequate to fund the provision of health care services in the county. This was affirmed by 88% of the respondents and this implies that the funds allocated for the health care are not sufficient for the demands of the health care services. Effectiveness of County Management on Decentralized Funds on Health Care Financing The figures in table 4 relates to the perceptions of the respondents on the concerns touching on management of funds on health care financing.
  7. 7. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 007 Triple A Res. J. Soc. Sci. Human. Table 3: The Adequacy of Decentralized Funds on Health care financing VI I SWS A VA Mean (Std. Deviation) The decentralized funds are adequate for health care services Freq. 37 9 0 13 0 1.81 (1.224) % 62.7 15.3 0 22 0 There are enough equipment and health care facilities in your county Freq. 30 15 7 7 0 1.85 (1.047) % 50.8 25.4 11.9 11.9 0 The public are satisfied with the health care services offered in the county health facilities Freq. 13 24 7 8 7 2.53(1.305) % 22 40.7 11.9 13.6 11.9 The percentage of funds received at the health care facilities are adequate Freq. 33 19 7 0 0 1.56 (0.702) % 55.9 32.2 11.9 0 0 Table 4: Effective Management of Decentralized Funds on health care financing NA TVSE SWE TLE TVLE Mean (Std. Deviation) Health management team involve the health workers in planning for the decentralized funds Freq. 21 13 14 5 6 2.36 (1.323) % 35.6 22 23.7 8.5 10.2 The health management team are managing their decentralized funds well Freq. 17 22 7 13 0 2.27 (1.112) % 28.8 37.3 11.9 22 0 The implementation of fiscal decentralization in health department is at an advanced stage Freq. 19 9 17 7 7 2.56 (1.368) % 32.2 15.3 28.8 11.9 11.9 All the stakeholders are involved in management of the decentralized funds Freq. 35 4 14 6 0 1.85 (1.111) % 59.3 6.8 23.7 10.2 0 The members of the public are satisfied with the management of the decentralized funds Freq. 16 23 7 6 7 2.41 (1.315) % 27.1 39 11.9 10.2 11.9 Table 5: Allocation of Decentralized Funds NA TVSE SE TLE TVLE Mean (Std. Deviation) Allocation of the decentralized funds are prioritized well according to the urgency and needs of the clients Freq. 25 14 14 6 0 2.02 (1.042) % 42.4 23.7 23.7 10.2 0 The allocation of decentralized funds is done fairly among the various facilities in the county Freq. 25 21 0 6 7 2.14 (1.383) % 42.4 35.6 0 10.2 11.9 Amount allocated to the health department is adequate Freq. 27 19 7 6 0 1.86 (0.991) % 45.8 32.2 11.9 10.2 0 More than 58% of the respondents indicated that they were not involved in the planning of decentralized funds, 24% could not discern how financing was undertaken with a further 18% being involved in the planning. This implies that planning for the decentralized funds is done by few employees which might be the norm when it comes to the planning function. About 66% of the respondents affirmed that the decentralized funds are not managed well, 22% affirmed that the funds were managed well while 12% could not comment. This suggests that the decentralized funds are not managed well as per the statutory requirements. The implementation of the fiscal decentralization in health care department is not at advanced stage or closer to fruition as affirmed by 44% of the respondents, while being disavowed by 22%. Another 28% of the respondents could not discern the implementation stage. The results indicate that implementation of fiscal decentralization is at some stage but not closer to fruition.
  8. 8. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 Gideon and Alfred 008 Table 6: Budgeting of Decentralized Funds SD D U A SA Mean (Std. Deviation) Members of the public are involved in the budgeting process Freq. 18 6 11 18 6 2.12 (1.102) % 30.5 10.2 18.6 30.5 10.2 Budgets are done based on the needs of health care providers Freq. 10 29 13 7 0 3.01 (0.201) % 16.9 49.2 22 11.9 0 All stakeholders participate in budget preparation process Freq. 27 25 7 0 0 1.03 (1.108) % 45.8 42.4 11.9 0 0 Budgeted amount for the department is adequate for each financial year Freq. 24 24 11 0 0 1.31 (1.133) % 40.7 40.7 18.6 0 0 The time taken for payment process to be finalized in the county treasury is long Freq. 4 13 4 19 19 2.31 (1.149) % 6.8 22 6.8 32.2 32.2 Source: Research data, 2015 More than 66% of the respondents affirmed that not all stakeholders are involved in the management of the decentralized funds while 24% could not discern the involvement of the stakeholders. This suggests that either there are very few stakeholders involved in the management of the decentralized funds or many stakeholders do not participate in the management of the funds. Close to 66% of the respondents affirmed that the public are dissatisfied with the management of the decentralized funds, 22% confirmed that the public were satisfied while the remaining 12% choosing to not voice the level of public satisfaction with the management of decentralized funds. These figures indicate that majority of the public are dissatisfied with the management of the decentralized funds. Influence of Allocation and Budgeting of Decentralized Funds on Health care financing in county Government. The statistics in table 5 above shows that perceptions of the respondents on the matters relating to the allocation and budgeting of decentralized funds. The statistics indicate that 66% of the employees affirmed that the decentralized funds are not prioritized, while 24% could not discern the prioritization of the funds with a further 10% alluding to prioritization being used. This implies that either there is lack of prioritization in the allocation of the decentralized funds or there is a disconnect in the perceptions with regard to how to allocate funds. More than 78% of the respondents affirmed that there is unfairness in the allocation of decentralized funds to the various county health facilities, while 22% perceived fairness in the allocation of the funds. This suggests that allocation of funds could be done on request or on the needs of the facilities. The funds allocated to the health department is not adequate as affirmed by 78% of the respondents, while 10% affirmed the adequacy of the funds with a further 12% choosing not the comment on the adequacy. This indicates that the amounts allocated are not adequate as per the demands of the health department. Influence of Budgeting of Decentralized Funds on health care financing in county government The statistics in table 6 shows the perceptions of the respondents on matters relating to the budgeting of decentralized funds in the health department. The statistics show that 41% of the respondents affirming that members of the public were involved in the budgeting process with a similar percentage disavowing the notion while 18% not being able to discern the involvement of the public in the budgeting process. This implies that there is public involvement in the budgeting process as is stipulated in the law. The budgets are not based on the needs of the health care providers as affirmed by 66% of the respondents, 22% could not discern the needs of health care providers in the budgets, while 12% confirmed that the needs of the providers are catered for in the budgets. This suggests that budgeting is done as per the requirement but not as per the demands of the health care providers. Not all the stakeholders are involved in the budgeting process as affirmed by 88% of the employees which indicates that probably a good number of stakeholders participate in the budgeting process. About 81% of the respondents affirmed that amounts budgeted are inadequate in each financial year which suggest that the health care departmental needs surpass the budgetary allocation. About the payment process, 64% of the respondents affirmed that process takes long with a further 29% affirming that the process was shorter. These suggest
  9. 9. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 009 Triple A Res. J. Soc. Sci. Human. Table 7: Effect of Efficient Budgeting and Allocation of Decentralized Funds Level of health care financing Allocation and Budgeting of decentralized funds Pearson Chi-Square 162.811 Sig. 0.22 N 59 Table 8: Expenditure of Decentralized Funds SD D U A SA Mean (Std. Deviation) The county government has a proper control of decentralized funds for health department Freq. 32 14 0 13 0 2.9 (0.341) % 54.2 23.7 0 22 0 Department of health has a strong internal control system Freq. 20 19 7 13 0 2.22 (1.146) % 33.9 32.2 11.9 22 0 The department of health follows the budget in its expenditure Freq. 24 22 6 7 0 1.93 (0.998) % 40.7 37.3 10.2 11.9 0 Auditing for the decentralized funds are done regularly in the department of health Freq. 9 33 7 10 0 2.31 (0.933) % 15.3 55.9 11.9 16.9 0 There is a proper checks and balances for the decentralized funds Freq. 14 25 14 6 0 2.31 (1.149) % 23.7 42.4 23.7 10.2 0 The monies allocated to the health care facilities are all spent in any fiscal year Freq. 19 27 13 0 0 2.12 (1.1) % 32.2 45.8 22 0 0 that the payment procedures at the county treasury may be long and thus it takes some time before payments are processed. Effective Expenditure of Decentralized Funds on level of health care financing The statistics in table 7 shows the perceptions of the respondents on issues touching on the expenditures of decentralized funds. The statistics indicate that county lacks proper control of decentralized funds for the health department as is affirmed by 78% of the respondents while 22% confirmed the existence of control of decentralized funds. This implies that the county treasurer who may be subjected to political mechanisms controls the decentralized funds for the health department. The health department lacks strong internal control system as affirmed by 66% of the respondents while 22% affirmed that the department has strong internal controls. This indicates that the departmental internal controls may be wanting and thus the perception of the lack thereof. About 78% of the respondents affirmed that the departmental expenditure does not abide by the budget, while 12% avowed that there is strict adherence to budget guidelines. This suggest that departmental expenditures may sometimes be affected by other factors other than those considered during budgeting process. More than 71% of the respondents affirmed that auditing in the health department is done irregularly, 17% are done regularly. This indicates that the audits are not regular but they are done on as is basis. There are no proper checks and balances for decentralized funds as affirmed by 66% of the respondents, while 24% could not discern the checks and balances in the management of the decentralized funds. Not all the monies allocated to the health care facilities are spent as affirmed by 78% of the respondents, while a further 22% choose not to comment. This indicates that some facilities spent all their allocation while others may not be able to fully utilize their allocation. DISCUSSION Relationship between Adequacy of decentralized funds and health care financing The findings from the study indicate that there is relationship between the adequacy of fiscal decentralization and the level of health care financing in that the most respondents indicated that there are inadequate funds for the healthcare financing the percentage of those who responded that there are no enough funds for health care financing is 78%. The equipment which are used in health facilities are not sufficient this is indicated by the percentage of 76.2% of the respondents stating that there is lack of equipment in various facilities in the county. From the findings the public are not satisfied by the services which are provided by the county government because of decentralization of health care services this
  10. 10. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 Gideon and Alfred 010 can be clearly be illustrated by the number of respondents who agreed that they are satisfied which was 32.8% of all the sampled respondents. Lastly the county government have allocated inadequate funds for the health care services which total a percentage of 100% agreeing that there are inadequate funds for health care services. Effectiveness of County Management Decentralized Funds on Health Care Financing The effectiveness of county management on fiscal decentralized funds has relationship with the level of health care financing. This is clearly illustrated with the findings, which are as follows; the involvement of health workers in the management of decentralized funds is not so impressive since the percentage of those in agreement is 42.4% while those of the contrary opinion is 57.6%. While on the management of decentralized funds, it was of the opinion of most of the respondents that the management are not managing the decentralized funds well. The implementation of decentralized funds is almost at average level since 47.5% of the respondents which is almost an average agreed that implementation of fiscal decentralization is at an advanced stage. On the issue of involvement of the stakeholders on the management of the decentralized funds, it was of the opinion of the many that not all stakeholders were involved. The members of the public were not satisfied with management of decentralized funds with 66.1% not satisfied. Influence of Allocation and Budgeting of Decentralized Funds on Health care financing The allocation and budgeting of decentralized funds has a relationship with the level of health care financing, this is clearly shown by the following indicators; on whether the members of public are being involved on budgeting process 40.6% disagreed while 11% were undecided and 24% agreed with that therefore it can be concluded that members of the public are not involved on budgeting process of the decentralized funds for health care. On whether budgets are done based on the needs of health care providers 66.1% disagreed, 13% were undecided while 7% agreed therefore it can be concluded that budgets preparation were not prepared based on the needs of health care providers. The involvement of stakeholders in participation on budget preparation process, 78.2% disagreed while 11.9% agreed, therefore the stakeholders are not involved in preparation of budgets. The budgeted amount for the department of health is adequate for each financial year, 81.4% disagreed while 18.6% agreed therefore it is concluded that the budgeted amount is inadequate. Lastly the time taken for payment process to be finalized in the county treasury is long 28.8% strongly disagreed while 64.4% agreed therefore it is concluded that time taken to finalize a process of payment in the county treasury is long. Effective expenditure of decentralized funds on level of health care financing The county expenditure of decentralized funds has relationship with the level of health care financing in that on whether the department of health has any internal control of decentralized funds it was of the opinion of many that there is no strong internal control to safeguard on misuse of the county funds. Many of the respondents also disagreed that the county follows the county budgets on making expenditures in that 78% stated that the county is not following budget while making expenditures. The respondents also did not agree to the question that the county is doing a regular audit on its expenditure while 16% agreeing that the department of health is doing a regular audit on its expenditure. On the question on whether the department is spending all monies allocated in each fiscal year, 78% disagreed while 22% agreeing this clearly illustrate that the county is not spending amount allocated to each fiscal year. Relationship of fiscal decentralization on the level of healthcare financing There is a relationship between fiscal decentralization on the level of health care financing where in terms of hospital staff benefits and rewards, 37.5% were opinion that that they were not financed at all while 35.4% were satisfied on the way they were financed while37.3% claimed that they were fairly financed. On the availability of equipment and other amenities, it was opinion of 38.8% that the county has not financed it at all while 50% were fairly financed and 23.7% fully financed. The county government is also responsible for purchase of medicine and medical drugs. 20.4% stated that they were not financed at all while 55.9% stated that they are fairly financed while 23.7% stated that they were fully financed on the transportation allowances 11.9% stated that they were not fully financed while 71.2% agreed that they were financed and therefore it is concluded that the department of health provide for transport allowance for its health workers. Interpretation of the Findings Findings showed that experience as an employee has an influence on the execution of duties and how well the employees know the organization. The results show that majority of the employees have over 5 years of experience hence they had enough experience at their work stations to help them execute their duties satisfactorily. Also, they provided responses based on a wider knowledge base of the organizations’ operations. In terms of gender, there is almost equal representation of both male and female employees. There was therefore no bias in the study. Employees working in the health department are mainly those in the age bracket of 26 to 35 years, 36 to 45 years and 18 to 25 years. Employees that are
  11. 11. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 011 Triple A Res. J. Soc. Sci. Human. Table 9: Testing of Hypothesis Using Chi Square Level of health care financing Pearson Chi-Square df Asymp. Sig. (2-sided) Adequacy of decentralized funds 136.496 90 0.001 Management of decentralized funds 97.350 81 0.004 Allocation and Budgeting of decentralized funds 63.257 63 0.467 Expenditure of decentralized funds 104.095 90 0.047 between the age of 46 to 55 years were least represented in the study. Based on the age brackets represented, it is evident that they could make independent decisions. The employees also have hands- on experience in the health department. From the findings, fiscal decentralization has a relationship with level of healthcare financing; this can be explained by the adequacy of decentralized funds which clearly shows that the funding for health care is not enough to meet the needs of the public. The effective management of the department of health determines the level of healthcare financing, this can be noted by the level of projection completion and the techniques in which the county health management committee will use in planning for the allocated finances for the department. From the respondents it is reported that the level of project completion is still low which is illustrated by the lack of well-equipped health facilities. The efficient budgeting and allocation of decentralized funds have relationship with the level of health care financing. The county has failed to prioritise its needs according to the urgency, the allocation of the funds is also not done according to various facilities and amongst the various departments within the health system and lastly the amount allocated are not adequate. The effect of expenditure of decentralized funds on level of health care financing this is illustrated by the internal control system, regularly auditing for the decentralized funds, checks and balances and allocation of funds. Tests of Hypotheses The study used Pearson chi square to determine the relationship between the independent variables (adequacy of decentralized funds, management of decentralized funds, allocation budgeting of decentralized funds and expenditure of decentralized funds) and the dependent variable (level of health care financing), where it had two key properties of magnitude and direction. Table 9 indicated that adequacy of decentralized funds had significant and positive relationship with Level of health care financing (χ=136.496, p=0.001<0.05). Therefore, null hypothesis was rejected. This infers that increase in adequacy of decentralized funds will increase health care financing. Findings also showed that there was positive and significant association between management of decentralized funds and adequacy of decentralized funds (χ=97.350, p=0.004<0.05). Hence, null hypothesis 2 was rejected. This showed that better management of decentralized funds will result to health care financing. Results in table 11 revealed that allocation and budgeting of decentralized funds had no significant relationship with health care financing (χ=63.257, p=0.467>0.05), thus, null hypothesis was accepted. Finally, expenditure of decentralized funds had positive and significant relationship with health care financing (χ=104.095, p=0.047<0.05). Hypothesis 1 HO1: There is no significant relationship between adequacy of decentralized funds and the level of health care financing in Uasin Gishu County. Since P = 0.001< 0.05 the null hypothesis was rejected. Hypothesis 2 H02: There is no significant relationship between effective management of decentralized funds and the level of healthcare financing in Uasin Gishu County. Since P= 0.004< 0.05 the null hypothesis was rejected. Hypothesis 3 HO3: There is no significant relationship between the Allocation and Budgeting of decentralized funds and the level of healthcare financing in Uasin Gishu County. Since P=0.467>0.05 the null hypothesis was not rejected. Hypothesis 4 HO4: There is no relationship between expenditure of decentralized funds and level of health care financing in Uasin Gishu County. Since P= 0.047< 0.05 the hypothesis is rejected. SUMMARY The research aimed to answer the following research questions; • To what extend does the adequacy of decentralized funds influence health care financing in Uasin Gishu County Kenya? • How effective is county management in influencing health care financing in Uasin Gishu County Kenya? • How does efficient budgeting and allocation of decentralized funds affect health care financing in Uasin Gishu County Kenya? • What is the effect of decentralized funds expenditure on health care financing in Uasin Gishu County Kenya? The study employed ex- post facto research design since it was not possible to ethically or physically control the variables and not possible to conduct an experimental design on this study. The study targeted 79 employees
  12. 12. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 Gideon and Alfred 012 from four hospitals in the Uasin Gishu county department of health. Semi structured questionnaire was used as the main research instrument, the questionnaire was both closed ended and open ended with part one having part A which contain background information such as age of respondents, gender, level of education and number of years of experience while part two had two sections B to E which was based on research questions. The study used Pearson chi square to determine relationship between the independent variables (adequacy of decentralized funds, management of decentralized funds, allocation and budgeting of decentralized funds and expenditure of decentralized funds) and the dependent variable (level of health care financing). The following null hypothesis testing was made; • That adequacy of decentralized funds had significant and positive relationship with Level of health care financing; therefore, null hypothesis was rejected. This infers that increase in adequacy of decentralized funds will increase health care financing. • Findings also showed that there was positive and significant association between management of decentralized funds and adequacy of decentralized funds. Hence, null hypothesis 2 was rejected. This showed that better management of decentralized funds will result to health care financing. • Allocation and budgeting of decentralized funds had no significant relationship with health care financing thus, null hypothesis was accepted. Finally, expenditure of decentralized funds had positive and significant relationship with health care financing. • The findings of the study revealed that there is a significant relationship between the adequacy of the decentralized funds and the level of health care financing in that if the decentralized funds are to be increased there will be an improvement on the health care services provided and vice versa the null hypothesis was rejected. CONCLUSION Based on the findings of this study the following conclusions were made; Management of decentralized funds and allocation mechanisms have a positive and significant effect on the level of health care financing. Despite this, there is inadequacy of decentralized funds for health care. In most cases, medicine, facilities and equipment as well as research and development are poorly financed. Thus, at the county level of government, the benefits of decentralization of funds have not been reaped. It is also noted that, the county management team is not effective in the management of county resources due the fact that there is lack of public involvement in the planning and prioritizing of health care funds, lack of public participation delays the public to choose on their preference as far as utilization of health care funds is concern. There is also dissatisfaction among members of the public about the management of decentralized funds. This is because of mismanagement and lack of participation of the relevant stakeholders such as health workers in the planning and management of decentralized funds. Consequently, there is lack of prioritization on the urgency and needs of the clients during the allocation of decentralized funds, perhaps due to lack of involvement in planning and management of the funds. Expenditure of decentralized funds on health care financing is a key factor in success of provision of quality health care services in this study it is noted that there is lack of strong internal control system and good financial management techniques. In South Africa, budgets were not adhered to, making the budget information base inconsistent, lacking uniformity, and of poor quality. Delays by provinces in preparation and submission of financial statements exacerbated this problem (Momoniat, 2002). It is therefore much too simple to attribute any problems in fiscal decentralisation in South Africa to the poor design or lack of clarity in assignment of functions, or mismatch between revenue powers and expenditure responsibilities or to the rate or sequencing of the devolution of functions. It is too easy to blame problems on the lack of capacity or poor information. These are the everyday realities of a developing country, affecting every sphere of government, irrespective of the degree of fiscal decentralisation (Momoniat, 2002). Momoniat (2002) concluded by affirming that decentralisation (or centralisation) will not work if problems of capacity, budgeting, financial management, reporting, information and transparency are not addressed simultaneously. These aspects are more critical in a decentralised context, because if these areas are not addressed, the problems surrounding assignment of functions and sequencing cannot be solved anyway. Recommendations In the context of the study, it appears that fiscal decentralization of funds has not done the good that was envisioned in the devolution. This is so because of the inadequacy of financing in research and development, medicine, facilities and equipment and admissions. The findings from the study recommend the following • The county should request for more funding from the central government and other partners in health, the county management must also involve health workers and stakeholders in planning and management of decentralized funds to ensure that there is prioritization on the urgency and needs of the clients. • There is also needing to increase monitoring of the decentralized funds so that cases of mismanagement by the health management team are reduced. The county must also improve on making good priorities when they are making the county budgets so as the issue of provision of quality health care is addressed. And lastly the county should improve on the internal control system in their expenditure to curb the issue of mismanagement of health care funds and corruption.
  13. 13. Triple A Research Journal of Social Science and Humanity (TARJSSH) | Vol.2 No.1 | June 2018 013 Triple A Res. J. Soc. Sci. Human. Areas for Further Research This study was conducted to examine the relationship between fiscal decentralization and health care financing in Uasin Gishu County Kenya. The sample was drawn from only Uasin Gishu County; thus, the study may be limited to the methodology used. Future research should seek to draw a large sample of respondents while using different methodology and could also look at effect of information a significant component in decentralization. Moreover, more time should be allocated to the same and a combination of more than one data collection instrument should be used for example interviews and focus group discussions, as these will help to counter check the information provided by the respondents. A further study needs to be conducted using more variables that may be relevant to this study. 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