2026-07-01http://hdl.handle.net/123456789/418706Most health care systems could improve their efficiency in using physical capital - buildings and equipment. Health care systems in which assets are provided by governments or donated by aid organizations generally have only weak incentives for those assets to be used efficiently. Wrongly located or inappropriate facilities, poorly utilized and maintained, are a result. This Discussion Paper summarizes the principles of effective, efficient, and equitable capital financing and capital charging in health care systems. It reviews the options for putting these principles into practice and refers to the limited literature on the impacts of those options. The objectives, principles, and practicalities of implementing capital charging arrangements are set out. The relative benefits and costs of points along the following dimensions are described and summarized: applying capital charges just to newly acquired assets or also to those already in existence; using notional or real capital charges; the time profile of charges; and the asset valuation basis adopted.application/pdftext/plainCC BY 3.0 IGOhttp://creativecommons.org/licenses/by/3.0/igo/World BankACCOUNTABILITYACCOUNTINGACCOUNTING STANDARDSACCOUNTING SYSTEMSACQUISITION COSTSACUTEADMINISTRATIVE COSTSALLOCATIVE EFFICIENCYALTERNATIVE USEASSET VALUATIONASSET VALUEASSETSBALANCE SHEETBOOK VALUEBUSINESS DECISIONSCAPITAL ASSETSCAPITAL INVESTMENTSCAPITAL PLANNINGCAPITAL RESOURCESCAPITAL STOCKCOMPETITIVE MARKETSCOST OF CAPITALDEBTDEPRECIATIONDEPRECIATION OF ASSETSDISCOUNT RATEDIVIDENDSEXPENDITURESGOVERNMENT FINANCEGOVERNMENT SECURITIESHEALTH CAREHEALTH CARE FINANCINGHEALTH CARE MARKETSHEALTH CARE PROFESSIONALSHEALTH CARE PROVIDERHEALTH CARE PROVIDERSHEALTH CARE PROVISIONHEALTH CARE SERVICESHEALTH CARE SYSTEMSHEALTH ECONOMICSHEALTH SECTORHEALTH SERVICESHEALTH SYSTEMHOSPITAL COSTSHOSPITALSHUMAN DEVELOPMENTHUMAN RESOURCESINCOMEINFLATIONINSURANCEINTEREST COSTSINTEREST PAYMENTSINTEREST RATEINTEREST RATESINVESTMENT DECISIONSINVESTMENT PRIORITIESINVESTMENT PROJECTSINVESTMENT RETURNLEVEL PLAYING FIELDMARKET VALUEMEDICAL EQUIPMENTNET REALIZABLE VALUENET VALUENUTRITIONOPPORTUNITY COSTPATIENTSPENALTIESPHYSICAL CAPITALPRESENT VALUEPRIVATE CAPITALPRIVATE CAPITAL MARKETSPUBLIC HEALTHPUBLIC HEALTH CAREQUALITY OF HEALTH CARERATE OF RETURNRESOURCE ALLOCATIONSTRAIGHT LINE DEPRECIATIONTOTAL COSTSTRANSACTION COSTSWORKING CAPITAL