Introduction

During the 1990s Sweden has embarked on a series of changes to health policy heavily influenced by the British NHS reforms. These have included the separation of purchasers and providers, an internal market regulated by contracts, competitive tendering, and the encouragement of the private sector. We discuss the origins and main features of the Swedish reforms, examine the subsequent developments which have led to a rethink, and consider what other countries can learn from this experience. To help answer these questions we interviewed senior politicians and policy makers in Stockholm County, as well as analysing official policy documents and carrying out empirical analysis of activity and cost data.

The run-up to the reforms

Why was reform considered necessary? One of the triggers was growing discontent among influential sections of the population, partly rooted in the effects of cost control during the 1980s.1 Through deliberate policies the proportion of gross domestic product spent on health care in Sweden fell from 9.6% in 1983 to 8.8% in 1991—Sweden and Ireland were the only countries in the Organisation for Economic Cooperation and Development to achieve any reduction at all over this period.2 A further decrease to 7.6% in 1993 was largely the result of shifting care of elderly people from counties to municipalities.

Although this stabilised the healthcare budget, there were negative effects. As relative priority in …