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13. At this point, it should be emphasized that the main purpose of introducing user fees in hospitals is not to recover the full cost of inpatient care. Preliminary results from studies on hospital costs in Kenya and Malawi (REACH, 1988; Mills, 1989) show that costs of providing inpatient care is too high to be recovered primarily through user charges given the per capita incomes in those countries. In Kenya for example, the cost of inpatient care in Kenyatta National Hospital in 1987 -- the main referral and teaching hospital in Kenya -- was estimated to be between US S 67 and 270 per day. Given such cost levels (which are largely a result of the prevailing medical care technology) the role of user fees in recovering costs of inpatient services without introducing unacceptable inequalities in medical care is limited. It should be emphasized that the type of medical care techbnology in use strongly affects medical care costs. Development of appropriate medical care technologies should be an integral element of health care financing strategies in Sub-Saharan Africa. See for example, Bonair, Rosenfield and Tengvald (1989) for a detailed discussion of medical care technology development in developing countries.

14. A stream of literature on cost recovery has argued that public hospitals should set up amenity wards and operate them on a fee-for service basis, just as private hospitals do, while at the same time maintaining subsidized care in other wards. Under such a system, the profits earned from amenity wards would be used to improve the quality, or expand the quantity of health services, primarily in the wards where the profits are earned. In general, this type of income generating scheme in goverr 'nt hospitals should be discouraged. "Amenity type care' should be left , private hospitals where such hospitals exist. Government hospitals should pu any surplus funds they may have in investments with the highest returns,5 and use their investment income to impiove hospital services that are used by the majority of patients. Such services would normally include outpatient services and bed care in general wards. In general, special or amenity wards in government hospitals should be provided for social or personal reasons, but not for better medical care that is unavailable in other wards. Patients opting for such wards should be charged market prices for the special, nonmedical treatment they receive, unless they are receiving services that might qualify for cross-subsidies, e.g. surgery.

15. The view that user fees should be restricted to the hospital sector represents one of the two extreme conceptualizations of how health services in Sub-Saharan Africa could be financed.<sup>6</sup> The other extreme view is that user fees should be introduced in primary health facilities (i.e. dispensaries and health centers), but hospital care should be provided free of charge at I The presumption is that returns to investments are not highest in the hospital sector. This is a reasonable assumption because the primary purpose of hospitals, especially those in the public sector is not to maximize profits.

**6** The general case represents a situation where user fees are charged in the entire health care system. The fees rise as one moves up the referral system.