Interactions between financing strategies, hospital characteristics and service quality among healthcare providers in Kenya

Abstract

Healthcare service quality is a concern world-over. In Kenya, the deficiency in service quality has often been linked to inadequate financing which has resulted in problems ranging from frequent industrial unrest to lack of supplies. While in search of the right financing approach to improve healthcare services, there is limited knowledge on financing strategies that can relate with service quality. There has been much debate on contribution levels from these different sources with little consensus on the issue. Not much has been done on other factors that could affect service quality indirectly. The purpose of this study was to establish the moderating effect of institutions characteristics on the relationship between healthcare financing strategies and the delivery of quality services in Kenya. The study sought to establish the gap between the expected and the perceived quality of health, the effects of; equity financing strategies on the quality of health care services, debt financing strategies on the quality of healthcare; network financing strategies on the quality of healthcare services and the moderating effect of Hospital characteristics on the relationship between healthcare financing strategies and quality of healthcare services in Kenya. The study was informed by Cosby Theory on quality, Pecking Order Theory and Resource Based View Theory. The study adopted an explanatory survey design with a target population being senior management and the clients drawn from 535 level 4 to 6 hospitals in Kenya. Random sampling was used to select a sample size of 233 respondents. Data was collected using structured questionnaires and was analyzed descriptively and inferentially. The paired sample t-test was performed to determine gap analysis hypothesis. Hypotheses for direct effect were tested using multiple regression model due to its appropriateness in establishing relationship between independent and dependent variables. Moderating hypotheses were tested using process macro model 1 version 3.4 at 0.05 level of significance. Findings from paired sample t-test showed insignificant gap between the perception and expectation of service quality (t=-1.108, p>.05). More findings revealed that equity (β=.45, p<0.05) and network financing (β=.29, p<0.05) had significant and positive effect on delivery of quality service in hospitals while debt financing had significant and negative effect on delivery of quality service in hospitals β=-.35, p<0.05), hence, tested hypothesis was rejected. Further, bed capacity showed significant moderating effect on the relationship between equity financing and service quality (R2Δ=.091, β=.348, p<0.05), debt financing and service quality (R2Δ=.063, β=.255, p<0.05), network financing and service quality (R2Δ=.072, β=.313, p<0.05). Similarly, results showed that facility type showed significant moderating effect on the relationship between equity financing and service quality (R2Δ=.11, β=.35, p<0.05). However, there was no significant moderating effect on relationship between debt financing and network financing on service quality. Thus, the study concludes that equity and network financing enhance delivery of quality service in hospital while debt financing hinders delivery of quality service in hospital. The study recommends that, government owned hospital with high bed capacity increase use of equity and network, financing strategies in order to improve service quality. The study provides unique recommendations towards knowledge on hospital financing in relationship to service quality. In addition, the study has contributed to new knowledge by establishing that bed capacity significantly moderates the relationship between and service quality, while Facility Type only moderates the relationship between equity financing and service quality but not the relationship between debt/network financing and service quality.