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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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
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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
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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
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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
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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.
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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.
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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
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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
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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. 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
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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.
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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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