RESOURCE-ALLOCATION FOR PUBLIC HOSPITALS IN ANDHRA-PRADESH, INDIA

The composition of the hospital sector has important implications for cost effectiveness accessibility and coverage. The classification of a cute general hospitals is reviewed here with particular reference to I ndia and Andhra Pradesh. Approaches to arrive at a norm for allocation of hospital expenditure among secondary and tertiary hospitals are di scussed. The actual allocation of public sector hospital expenditures is analyzed with data from Andhra Pradesh. The shift in allocative emp hasis away from hospitals and in favour of primary health care during the 1980s was found to have been equally shared by secondary and terti ary hospitals. The shares of recurrent (non-plan) expenditure to secon dary and tertiary hospitals were 51% and 49% respectively. This can be compared to a derived norm of 66% and 33%. The opportunity that new i nvestment funds (plan schemes) could have provided to rectify the expe nditure bias against secondary level hospitals was missed as two-third s of plan expenditure were also spent on tertiary level hospitals. The share of secondary hospital bed capacity was 45.5% against India's Pl anning Commission norm of 70%. Public spending strategies should expli citly consider what mix of hospital services is being financed as well as the balance between hospital and primary health care expenditures.