Soft budget constraints in Polish public healthcare entities

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Although the theory of soft budget constraints is widely presented in the literature, little is known about the factors of soft budget constraints in public hospitals in Poland. This study is relevant because many Polish hospitals struggle with serious debt problems. The study aims to systematise the regulatory and legal provision of soft budget restrictions in the activities of healthcare institutions, particularly public hospitals in Poland, and to assess the impact of these restrictions on their further functioning. An analysis of hospitals’ regulatory and legal activities shows the implementation of various soft budget restrictions. On November 20, 2019, Poland returned to the soft budget constraints, which functioned immediately after the introduction of reforms in the late 90s of the last century. As of 2021, out-of-pocket costs for treatment have decreased to 19.56%, but costs are gradually increasing and in 2020, according to the World Bank, they amounted to 71.89%. The provision of medical services mainly by public hospitals owned by local governments and scattered healthcare debt make it difficult to liquidate an inefficient public hospital in the event of its default. The study proves that the main reason for not eliminating the soft budgetary constraints of hospitals through their commercialization was the inconsistency of the carried out reform of commercialization of hospitals with the financial condition of local authorities.

Acknowledgment
The authors thank the Institute of Economic and Financial Expertise in Łódź for financial support in publishing this paper.

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    • Figure 1. Health expenditures in Poland during 2011–2021
    • Conceptualization
      Zbysław Dobrowolski, Waldemar Sługocki, Marian Kachniarz, Arkadiusz Babczuk
    • Formal Analysis
      Zbysław Dobrowolski, Arkadiusz Babczuk
    • Investigation
      Zbysław Dobrowolski, Waldemar Sługocki, Marian Kachniarz, Arkadiusz Babczuk
    • Methodology
      Zbysław Dobrowolski, Waldemar Sługocki
    • Project administration
      Zbysław Dobrowolski
    • Supervision
      Zbysław Dobrowolski
    • Writing – original draft
      Zbysław Dobrowolski, Waldemar Sługocki, Marian Kachniarz, Arkadiusz Babczuk
    • Writing – review & editing
      Zbysław Dobrowolski
    • Data curation
      Arkadiusz Babczuk
    • Funding acquisition
      Arkadiusz Babczuk
    • Resources
      Arkadiusz Babczuk
    • Validation
      Arkadiusz Babczuk