A major shift appears to be underway in Europe in the relationship between national, regional, and local control over health sector decision-making. Since World War II, a central thrust of health policy has been to decentralize key dimensions of decision-making authority to increasingly lower levels of government, as well as (in Social Health Insurance systems and recently in some tax-based systems) to private sector organizations.1 This strategy, to adapt Kondratiev's business-cycle framework,2 has been one of two overlapping ‘long waves’ that helped frame structural decisions in most Western European health systems. The second wave—market-influenced-entrepreneurialism—has run simultaneously with decentralization since the late 1980s. However, while this second, market-oriented wave has generated considerable controversy in some health policy circles, the concept of decentralization was readily accepted in many national policy contexts. As a result, over the second half of the 20th century, expanded decentralization of authority to regional, municipal and non-governmental control has become part of the ‘received wisdom’ about what good health policy should include. In the tax-funded health systems in Nordic countries, for example, most administrative and managerial responsibility as well as substantial political (policy) and fiscal decision-making control has been decentralized inside the public sector: from national to regional level (somatic hospitals in Norway in 1970; mental hospitals in Sweden in 1967), from regional to municipal level (elderly residential care in Sweden in 1992), and from national to municipal level (effective decision-making control over central hospitals in Finland in 1993). In the tax-funded health systems in Southern Europe, most administrative and managerial as well as many political (but not key fiscal) responsibilities were devolved from national to regional governments in Spain (to the 17 autonomous communities from 1981 to 2003), and in Italy (to 22 regional governments starting in the late 1980s). In social health insurance funded …