Hospitals as complex adaptive systems: A case study of factors influencing priority setting practices at the hospital level in Kenya

•Priority setting practices reveal the complex adaptive systems (CAS) nature of hospitals.•Hospital priority setting is influenced by deficiencies in both system hardware and software.•Intervening in CAS requires fostering productive emergence, not simple, mechanistic solutions.

There is a dearth of literature on priority setting and resource allocation (PSRA) practices in hospitals, particularly in low and middle income countries (LMICs). Using a case study approach, we examined PSRA practices in 2 public hospitals in coastal Kenya. We collected data through a combination of in-depth interviews of national level policy makers, hospital managers, and frontline practitioners in the case study hospitals (n = 72), review of documents such as hospital plans and budgets, minutes of meetings and accounting records, and non-participant observations of PSRA practices in case study hospitals over a period of 7 months. In this paper, we apply complex adaptive system (CAS) theory to examine the factors that influence PSRA practices. We found that PSRA practices in the case hospitals were influenced by, 1) inadequate financing level and poorly designed financing arrangements, 2) limited hospital autonomy and decision space, and 3) inadequate management and leadership capacity in the hospital. The case study hospitals exhibited properties of complex adaptive systems (CASs) that exist in a dynamic state with multiple interacting agents. Weaknesses in system 'hardware' (resource scarcity) and 'software' (including PSRA guidelines that reduced hospitals decision space, and poor leadership skills) led to the emergence of undesired properties. The capacity of hospitals to set priorities should be improved across these interacting aspects of the hospital organizational system. Interventions should however recognize that hospitals are CAS. Rather than rectifying isolated aspects of the system, they should endeavor to create conditions for productive emergence.