Regulated competition and citizen participation: lessons from Israel.

OBJECTIVE: To investigate the relationship between health system structure and citizen participation, in particular whether increased reliance on competition encourages or depresses citizen involvement.
SETTING: The case of Israel's ongoing health reform, based on regulated competition among sick funds, is examined.
DESIGN: Interviews with government officials and representatives of consumer groups; analysis of policy documents, judicial rulings, public surveys and journalistic accounts.
RESULTS: The Israeli reform is based in large measure on a regulated competition model, in which citizens have free choice among highly regulated competing sick funds. At the same time, the reform process has been accompanied by legal, institutional and political frameworks, as well as significant interest group activity, all aimed at increasing public input into processes of health policy making and implementation. The Israeli case, it is argued, lends support to the proposition that citizen participation (voice) and individual choice (exit) are complementary, rather than alternative, modes of ensuring citizen influence over health services. The question is whether the development of multiple avenues for citizen involvement represents disarray or a healthy social learning process regarding the running of the health system.
CONCLUSION: This paper expresses cautious optimism that citizen participation is a projection of a healthy social learning process, and suggests directions for public policy to encourage this outcome.