The private-public mix of healthcare: evidence from a decentralised NHS country.

Privatizations of public services are often driven by economic scarcity and changes in political leadership, in particular election victories for conservative or neoliberal political parties. Data from Norwegian counties on numbers of medical specialists in secondary care over a period of 11 years (1991-2001) allow us to analyse effects of economic, socioeconomic, and political factors on supply of both public and private specialists and the private-public mix. We find striking variations between the main explanatory factors related to public and private supply. Supply of public specialists is explained by counties' revenue levels and demographic factors and is not affected by the party composition of councils. The supply of private specialist medical services is negatively related to the proportion of elderly patients. The scarcity hypothesis is confirmed as lower county revenue levels increase both the absolute and relative proportions of private supply. Political composition of councils affects the private proportion of medical specialists as increased representation of conservatives leads to privatization.