Decree No 502/1992, later amended by Legislative Decree No. 517/1993 specifies, in article 3, paragraph 1, that current Health Administrations possess a considerable degree of autonomy:

organizational and managerial: in other words an autonomy involving the possibility and power to decide one’s own organizational system, which is the basic structure, a system of inside roles that implements the division of labour, and which comprises rules and coordination and control levels as a whole;

administrative: meaning they have the authority to adopt administrative measures that imply exercising public authority;

property: understood as the qualification to dispose of one’s own property through acts of acquisition, deeds of transfer and administrative acts;

accounting: lastly, this autonomy is considered as a possibility to draft economic and financial documents typical of the health sector; this is the special feature of Health Administrations.

The measures present in the abovementioned regulatory paper have been greatly amended by Legislative Decree No. 229/1999 (called “Bindi decree”) - in article 3, paragraph 1 b, it transforms Local Health Administrations from totally public institutions into Health Administrations that have a public legal status but also possess entrepreneurial autonomy. Reference to the company concept the regulation creates must not be interpreted in its most traditional juridical sense as property organized by the entrepreneur while performing his duties and neither in a strictly economic sense, but as decisional activity carried out and characterized by specialized professionalism in the process of making “specialized” decisions.
The novelties introduced do not only concern the juridical nature of Health Administrations but also the powers assigned to the Regional Administration. In fact the measures, moving on from a strict list of the Regional Administration’s duties, precisely define and limit the latter’s institutional duties, thus solving well-known interpretational doubts concerning its authority on this subject. Article 2 of the Legislative Decree examined also assigns administrative duties to Regional Administrations, besides legislative and programming capacities. In particular, Regional Administrations are assigned decision-making duties concerning: the organization of services and activities targeted at defending health; setting financing criteria; technical, advertising and support orientated activities for health units; and, supervision and control.
The current regulatory picture lastly studied by the “Bindi Reform” reconfirms regional programming powers. These powers are limited by specifications in article 2, paragraph 2 quinques, that introduce local executive programming, thus imposing on the same a programming activity that is not detailed, but which, in any case, guarantees provinces, municipalities and metropolises company type programming. To be more precise, article 3 of Legislative Decree No. 229/1999 presents more connotative elements of the company-forming process. In fact paragraph 1 b specifies that the General Manager must regulate the organization and operations of Local Health Administrations with a company act under private law.
The Regional Administration must set criteria and guidelines for the draft of this act so that these activities are regulated by an act that expresses entrepreneurial autonomy and is, as such, subject to common law regulations. Subsequently the decisional role in Health Administrations is divided between the Regional Administration that participates in and answers for the economic risk, and the very Health Administrations that answer for the management and development methods of activities. With regard to this and understanding the limits set by regional political organs, we can stress in this paper how the company act can be considered a tool to assist the General Manager in asserting the perception of the strategic space at his disposal and in filling with contents his entrepreneurial autonomy, an autonomy confirmed by the Bindi reform. In fact thanks to this autonomy’s private nature, it seems that the Managing Director can be assured a more decided and incisive managerial action (with the subsequent pursuit of rationality concerning the purpose rather than the regulation!), so that organizational measures taken in its sphere are free from the obligation of publication, which is unforeseen for deliberative acts of administrative law in a strict sense. With reference to the exercise of regional powers, we must highlight the amendments to Legislative Decree No. 502/1992 introduced after Legislative Decree No. 168/2000 became effective.
They concern the company act’s method, tools and decisions concerning criteria and guidelines. In fact the original regulatory letter specified that Regional Administrations should mark out with a law the principles and criteria the company act had to comply with. Legislative Decree No. 168/2000, article 1, instead prescribes that the same criteria and principles must be established with regional measures.
From what has been highlighted and from the general nature of the terms used by the latest legislator we can clearly notice a “weakening process” in the recognition and hence in the consequences of regional reference sources. Drawing attention to “regional measures” lets us understand that Regional Administrations can intervene with any act, thus severely putting to the test one of the main guarantees offered by the juridical system: “the certainty of the law”. Now to take a closer look at the repercussions that could have a legislative influence on practical effects, on those effects that concern the General Manager’s approach in drafting his company act, we have the duty to highlight his absolute uncertainty when drafting his act. In fact in drafting and adopting that which is his most important act, he must follow regional principles and guidelines aware that these can be modified at any time by procedures that offer less support to civil rights and are no doubt faster than those required to change regulatory measures. The concrete result of what was specified in Legislative Decree No. 168/2000 hence completely depends on political organs’ sensitivity in exercising the extensive decisional power given them.
The region has also the power to control the act. By control we do not mean the approval typical of administrative measures, but a more general activity consisting in checking the act’s compliance with the course and programme traced by the same regional institution. In fact, we only wish to mention here that from the moment the Regional Administration intervenes establishing principles and guidelines it influences the company act’s very meaning, defining the extent and quality of the result and hence the difference from a typically managerial approach. A recent collection of guidelines issued by Regional Administrations concerning company act drafts highlighted how each region faces the problem differently. Some have in fact studied extremely detailed documents, others have instead drafted acts that contain basic rules, referring details to formal acts to be made at a later date; with these the Health Administration makes its organizational structure known both inside and before a third party.
Equally significant from a strictly empirical viewpoint are the results of a study conducted by the Health Economics Research Laboratory, Università Cattolica del Sacro Cuore, Milan, on Local Health Administration No. 198 A-USL, to assess the adoption of the company act following the issuing of regional guidelines and criteria.
The study highlighted how many Regional Administrations are already in step with regulatory measures while others instead are resorting to the assistance of special work groups to study a regional course or are acting while reorganizing regional health services, excessively prolonging the time required1 . The company act is an act that is adopted with a simple written private agreement and not with an administrative measure and, as such, cannot be impugned before an administrative judge.
Ordinary legal remedies can be resorted to against it, in other words an appeal can be lodged to the ordinary judge if one notices the infringement of an individual right, of an interest that is believed worthy of being protected by the legal system. In this paper we must stress some divergences that have emerged in legislative theory on the company act’s exact juridical “nature” to better understand the importance and reasoning behind the ter reform. Some believe that the company act’s juridical nature cannot be willingly traced back to legal measures already well known in public and private companies. On the basis of such considerations the company act can in no way form a Health Administration as the related procedure is regulated in detail by the law, nor can it be considered a statute and, as such, meant to regulate the activities of the same structure.
The legislator’s concern was to create an original legal document: an act of self-government meant to regulate the Health Administration’s organizational and functional situations, whose value depends on deciding the type of administration the entrepreneur means to realize. Others instead, in specifying that the legislator’s intention was to absorb the company act in the articles of partnership of private companies, whose inside organization the Health Administration must imitate, however stress the divergences existent between the two acts. While a private company’s articles of partnership must specify the managers and legal representatives, a Health Administrations’ company act is not under this obligation because administrative and representative functions are assigned by law to the General Manager. Besides, the acquisition of Health Administrations’ legal status is contemplated by law, while in private companies the acquisition of the same is subject to their registration in the Register of Companies. Article 3, paragraph 1 ter of the Bindi Decree introduces a further principle: Health Administrations must organize their management on efficient (seeking the best relations between products obtained and resources used), cost-saving (understood as rationality concerning the purpose and the regulation), and effective criteria (reaching fixed objectives and their effect on the outside environment that implies the possibility for Local Health Administrations to automatically establish certain different objectives compared to those fixed by the Regional Administration), respecting a budget by reaching a balance between costs and profits, including the transfer of financial resources.
The Decree once again stresses the Regional Administration’s authority over decisions concerning the allocation of a possible surplus obtained, and its responsibility to find financial resources to be used to cover possible deficits.
The specifications in the precept examined, according to which Health Administrations operate through acts under private law, could let us wrongly understand that Local Health Administration activities are entirely based on acts under private law, but it is not so in practice.
Health Administrations have the autonomy of private law but, depending on the legislation that regulates their functions, they are also furnished with a public capacity. Many are in fact the regulations that foresee authoritative interventions on the part of the organs of Health Administrations.
These interventions represent the clear practice and expression of public authority, such as for example drafting a budget, which, as an authorization on the part of the institution to undertake and pay expenses and to ascertain and collect revenue, can only be traced back to the expression of an authority typical of public law. The company act’s analysis cannot disregard the study of the issues it gives rise to.
These can be distinguished in compulsory by law, compulsory by company decision and optional. The reasoning behind this division lies in the need to uniformly protect health throughout the nation and in rationalizing the use of resources to obtain a quality and quantity improvement in services supplied by the system as a whole. Among issues that are compulsory by law, the following take on special importance because they are the direct expression of the specified entrepreneurial autonomy: controlling the organization and running of health administrations; marking out the operational structures furnished with only managerial or technical and managerial autonomy in those structures that have the power to represent the company outside and are responsible for the duties assigned them; and, interventions to regulate the purchase of imported goods and services that are below the community ceiling.
Concerning personnel more in detail, the regulation contemplates that the company act must necessarily contain measures that “regulate assignments to the administrative director, who is also the health director, to the directors of health services, districts and departments and to executives in charge of complex structures and measures regulating decisions that involve the Health Administration from the outside, to implement certain objectives defined in the company’s programming and financial sphere”.
On the basis of company decisions compulsory contents are strictly related with the General Manager marking out priorities and objectives; he finds his legal justification and the content of his work in these very functions. The optional contents are instead referred to the free discretion of the company, marked out depending on the territory’s special features and the demographic type in which the structure operates to implement harmonization between objectives to be reached and tools to be used. Hence the legislator’s decision to specify the definition of rules on two levels, regional and of Health Administration, offers greater flexibility and rationality from a functional viewpoint in specifically company-orientated decisions. Reforms introduced to the “founding” law that formed the National Health Service, and in particular the Bis and Ter reforms, have certainly brought about deep changes in the NHS’ “operational structures” to the point of distorting the original institutional principles derived from public law. In fact now the control of the Local Health Administration’s management can be traced back to the civil code and marked by elements of private law that highlight the increasingly entrepreneurial nature of the “public” activity practiced.
The abovementioned reforms have also produced another effect company-wise: the “depoliticization” of the organs appointed to manage the institution. They have done it by assigning management responsibilities to a Socratic organ, the General Manager, making him responsible for the results achieved, and by specifying various sanctions, even serious ones, in cases which present a serious fault such as “the disdainful neglect of official duties”. Hence the company act is one of those mechanisms that are targeted at implementing a new governing set up of the system. The latter should guarantee the company management the new stimuli required to continue the mission.
By governing set up we mean all those relations existent between “company property”, that expresses its mission, and the management that is called to carry out the mission by defining strategic lines of action. 1 Among the many cases analysed special attention was given to the Lombardy Region’s case, which, as a matter of fact, is the only case in which the Region concretely and successfully implemented the regulatory measure.
The Lombard experience is described and analysed as follows: “In the Lombard health system, ahead of schedule concerning the Ter Reform, with Regional Council Decree No. 34276 dated February 20 1998, the Regional Council furnished General Managers with guidelines for the organization and running of Local Health Administrations.
It specified that the General Manager must adopt the Company Organization Plan (POA) within the autonomy specified in art.8, paragraph 2 of Legislative Decree No. 502/92.
The paper described the model proposed in terms of operational logic, macro- functions to be performed and management of the company budget.
Though this act is prior to the prescriptions requested by the Bindi Decree concerning the company act, a close study of the paper highlights that the issues faced are virtually the same. Following these guidelines many Local Health Administrations adopted the POA complying with the requisites specified. Lastly we must say that the Lombardy Regional Council has informed us that it does not plan on adopting a resolution concerning guidelines for drafts of company acts till July 2002”.

Carmen LANDI
Giuliana RENDA
Final year students, Degree in Political Science, Unical Legislative

Translated by Interpres sas