Decentralization and Primary Health Care Innovations in Indonesia

A well-functioning primary health care system (PHCS) is a fundamental precondition for a nation’s overall health performance. PHCSs are designed to improve universal access to health care, which in turn leads to healthier communities, higher quality of care, and a more effective and efficient health care system. The present chapter investigates how the two large-scale decentralization waves in Indonesia affected one specific aspect of the country’s health sector performance: its potential to introduce process, product, and structural innovations in its primary health care system. We argue that local level innovations are a major requirement to improve the performance of a PHCS. Drawing on an in-depth analysis of institutional changes between the two phases of decentralization, and selected case studies, we show that the first wave of decentralization in Indonesia actually resulted in institutional changes that were detrimental for innovation. Whereas discretion for local level decision makers increased compared to the situation in the centralized system, requirements for accountability did not. This pattern was reversed during the second wave of decentralization, suggesting that the conditions for innovation improved. The rare cases of innovation that did occur share a specific combination of initiative, commitment and social capital of a key decision maker.