IMPLEMENTING PERFORMANCE‐BASED FUNDING FOR HEALTH RESEARCH: WHEN GOVERNANCE AND PROCEDURAL FAIRNESS MATTER

Abstract

The article examines the implementation by the Italian Ministry of Health of performance‐based funding to allocate resources for research to IRCCS (Istituti di Ricovero e Cura a Carattere Scientifico) hospitals. The analysis provides evidence that ten years from its introduction the performance‐based funding system has persisted, but it has been implemented rather differently from what had been imagined by its proponents. By drawing on the theoretical frameworks of policy implementation, agency, and relational contracting, the study establishes that the overall design of the system has contributed to this final outcome only to a limited extent. Rather, the lack of procedural fairness, as well as of political leadership in linking the system to national research priorities, has undermined the basis for trust between hospitals and the Ministry of Health. The article discusses how, in this, the governance of performance‐based funding and its strong ownership by the ministerial bureaucracy has been determinant.

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