Health Care Reform in Vietnam: Chasing Shadows

The purpose of this paper is to analyse and assess health care reforms in Vietnam since the late 1980s. It will argue that shortcomings of the reforms centre on three related sets of measures: substitution of budgetary allocation with user charges, expansion of social insurance and promotion of decentralisation. Reduction in fiscal support for providers offered them the motive to concentrate on revenue-generating activities while user charges provided them with the means to do so. With both the motive and the means for maximising revenues in place, providers vigorously pursued income-maximisation which had the effect of raising overall expenditures while reducing access. To deal with the problem of declining access due to rising user charges, the government is in the process of vigorously expanding social insurance. However, social insurance does not deal with the root causes of the problem of rising expenditures which lie in paying providers on a fee-for-service (FFS) basis. The paper will further argue that decentralisation has aggravated the adverse effects of FFS by diluting control and accountability.