Efficiency of Public Procurement in the Czech and Slovak Health Care Sectors

Juraj NEMEC,Zuzana KOTHEROVÁ,Gleb DONIN,Matúš KUBÁK

doi:10.24193/tras.62e.7

Abstract

Health systems in most (if not all) countries perpetually struggle with financial problems and search for resources to cover health care needs. Increased efficiency of health procurement has the potential to save a lot of money and to reallocate them to treatments. The aim of our study is to analyze technical efficiency (efficiency/economy dimension) and allocation efficiency (effectiveness) of public procurement in health care facilities in the Czech Republic and Slovakia, countries whose health systems are governed by the principle of universal access to high quality health services. Concerning the technical efficiency, the results show a low rate of competitiveness whereby the potential of competition is not exploited. In terms of allocation efficiency, our research also sufficiently illustrates the criticality of the situation; however, compared to the element of technical efficiency the situation in the evaluated countries is different. In Slovakia, purchases are usually decided by doctors and procurement is prepared without the necessary ex-ante analysis. In the Czech Republic, the ex-ante evaluation of purchasing of medical equipment is regulated, however, the decision-making process is non-transparent and does not guarantee allocative efficiency. The study has critical policy implications – both countries should urgently adopt measures to improve their respective procurement processes.

Highlights

Increasing the efficiency of public procurement, through which both Slovakia and the Czech Republic spend about 15% of their GDP, is one of the key factors in the functioning of the public finance system
The aim of our study is to analyze technical efficiency and allocation efficiency of public procurement in health care facilities in the Czech Republic and Slovakia, countries whose health systems are governed by the principle of universal access to high quality health services
We set out the following two main and four auxiliary research questions: 1. What is the rate of competitiveness in public procurement (PP) in the Czech and Slovak health care sectors and what is its impact on economy/efficiency? a) Rate of competitiveness? b) Impact of the rate of competitiveness on the final price? c) Indicative value of the indicator difference between expected and final price?

Summary

Introduction

Increasing the efficiency of public procurement, through which both Slovakia and the Czech Republic spend about 15% of their GDP, is one of the key factors in the functioning of the public finance system. Grega (2018) identified and analyzed the main factors determining the efficiency of public procurement (PP) in Slovakia through extensive primary and secondary research. His questionnaire survey among contracting authorities and suppliers in PP in Slovakia shows that excessive bureaucracy in PP in Slovakia is perceived as the most important factor determining its efficiency. From the suppliers’ point of view, the most important factor is ‘lack of ethics and morality on the part of contracting authorities and/or procuring authorities’ and the suppliers placed the ‘excessive bureaucracy’ factor in the second place. The factors were placed in this order: ‘lack of control’, ‘non-compliance on the part of the contracting authorities’, and ‘few suppliers involved in PP’

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Discussion

Conclusion