Policy Implementation, Street-level Bureaucracy, and the Importance of Discretion.Street-level bureaucrats implementing public policies have a certain degree of autonomy – or discretion – in their work. Following Lipsky, discretion has received wide attention in the policy implementation literature. However, scholars have not developed theoretical frameworks regarding the effects of discretion, which were then tested using large samples. This study therefore develops a theoretical framework regarding two main effects of discretion: client meaningfulness and willingness to implement. The relationships are tested using a survey among 1,300 health care professionals implementing a new policy. The results underscore the importance of discretion. Implications of the findings and a future research agenda is shown. Keywords: Discretion; public policy; policy implementation; street-level bureaucracy; quantitative analysis INTRODUCTION In his book Street - level bureaucracy : Dilemmas of the individual in public services, Michael Lipsky () analysed the behaviour of front-line staff in policy delivery agencies. Lipsky refers to these front-line workers as 'street-level bureaucrats'. These are public employees who interact directly with citizens and have substantial discretion in the execution of their work (1980, p. 3). Examples are teachers, police officers, general practitioners, and social workers. These street-level bureaucrats implement public policies. However, street-level bureaucrats have to respond to citizens with only a limited amount of information or time to make a decision. Moreover, very often the rules the street-level bureaucrats have to follow do not correspond to the specific situation of the involved citizen. In response, street-levelbureaucrats develop coping mechanisms. They can do that because they have a certain degree of discretion – or autonomy – in their work (Lipsky , p. 14). Following the work of Lipsky, the concept of discretion has received wide attention in the policy implementation literature (Brodkin [ 6]; Buffat [ 8]; Hill and Hupe ; Sandfort ; Tummers et al. ; Vinzant et al. ). However, scholars have not yet developed theoretical frameworks regarding the effects of discretion, which were subsequently tested using large-scale quantitative approaches (Hill and Hupe ; O'Toole ). This study aims to fill this gap by developing a theoretical framework regarding two effects of discretion. The first effect, which is often noted, is that a certain amount of discretion can increase the meaningfulness of a policy for clients (Palumbo et al. ). An example can clarify this. A teacher could adapt the teaching method to the particular circumstances of the pupil, such as his/her problems with long-term reading, but ease when discussing the material in groups. The teacher could devote more attention to the pupil's reading difficulties, thereby providing a more balanced development. More generally, it is argued that when street-levelbureaucrats have a certain degree of discretion, this will make the policy more meaningful for the clients. Client meaningfulness can thus be considered a potential effect of discretion. Here, we note that client meaningfulness is highly related to concepts such as client utility or usefulness. Furthermore, it can be argued that providing street-level bureaucrats discretion increases their willingness to implement the policy (Meyers and Vorsanger ; Sandfort ). Tummers () showed this effect while studying 'policy alienation', a new concept for understanding the problems of street-level bureaucrats with new policies. One mechanism underlying this relationship between discretion and willingness to implement seems to be that a certain amount of discretion increases the (perceived) meaningfulness for clients, which in turn enhances their willingness to implement this policy (Hill and Hupe ; Lipsky ). This is expected as street-level bureaucrats want to make a difference to their clients' lives when implementing a policy (Maynard-Moody and Musheno ). Hence, when street-level bureaucrats perceive that they have discretion, they feel that they are better able to help clients (more perceived client meaningfulness), which in turn increases their willingness to implement the policy. This is known as a mediation effect. This effect is often implicitly argued, and has yet to be studied empirically. Based on this rationale the central research question is: To what extent does discretion influence client meaningfulness and willingness to implement public policies , and does client meaningfulness mediate the discretion -willingness relationship? This brings us to the outline of this article. We will first develop a theoretical framework, outlining the relationships between discretion, client meaningfulness, and willingness to implement. The 'Methods' section describes the operationalization of the concepts and research design, which is based on a Dutch nationwide survey among 1,300 psychologists, psychiatrists, and psychotherapists implementing a new reimbursement policy. The 'Results' section shows descriptive statistics and discusses the hypotheses. We conclude by discussing the contribution of this article to policy implementation literature with a particular emphasis on the importance of discretion of street-level bureaucrats. THEORETICAL FRAMEWORK Background on discretion This article focuses on the discretion of street-level bureaucrats during policy implementation. Due to the abundance of literature and the intrinsic difficulties with the discretion concept (such as the different interpretations attached to as well as criticisms of these interpretations), we will provide only a short overview of the term discretion (for elaborate overviews, see Evans (), Hill and Hupe (), Lipsky (), Maynard-Moody and Portillo (), Meyers and Vorsanger (), Saetren (), and Winter ()). For a recent critique on discretion, see Maynard-Moody and Musheno (). Evans () has noted that for employees, discretion can be seen as the extent of freedom he or she can exercise in a specific context. Related to this, Davis ([ 9], p. 4) states 'a public officer has discretionwhenever the effective limits on his power leave him free to make a choice among possible courses of action or inaction' (see also Vinzant et al. ). Lipsky () focuses more specifically on the discretion of street-level bureaucrats. He views discretion as the freedom that street-level bureaucrats have in determining the sort, quantity and quality of sanctions, and rewards during policy implementation (see also Hill and Hupe ; Tummers ). We then define discretion as the perceived freedom of street-level bureaucrats in making choices concerning the sort, quantity, and quality of sanctions, and rewards on offer when implementing a policy; for instance, to what extent do policemen experience that they themselves decide whether to give an on-the-spot fine? To what extent do teachers feel they can decide what and how to teach students about the development of mankind, i.e. evolution or creationism (Berkman and Plutzer [ 3])? As can be seen from the previous paragraph, we focus on experienced discretion. This is based on Lewin's () notion that people behave on the basis of their perceptions of reality, not on the basis of reality itself (Thomas Theorem). Street-level bureaucrats may experience different levels of discretion within the same policy because, for example, (a) they possess more knowledge on loopholes in the rules, (b) their organization operationalized the policy somewhat differently, (c) they have a better relationship with their manager which enables them to adjust the policy to circumstances, or (d) the personality of the street-level bureaucrat is more rule-following or rebellious (Brehm and Hamilton [ 5]; Prottas ). In both top-down and bottom-up approaches of policy implementation, the notion of discretion is important (DeLeon and DeLeon ; Hill and Hupe ). From a top-down perspective, discretion is often not welcomed (Davis [ 9]; Polsky ). Discretion is primarily seen as a possibility that street-level bureaucrats use to pursue their own, private goals. This can influence the policy programme to be implemented in a negative way, which undermines the effectiveness and democratic legitimacy of a programme (Brehm and Gates [ 4]). In order to deal with this issue, control mechanisms are often put in place in order to achieve compliance. In the bottom-up perspective, discretion is assessed differently. Discretion is seen as inevitable in order to deploy general rules, regulations, and norms in specific situations, which helps to improve the effectiveness of policy programmes and the democratic support for the programme. Moreover, given the limited time, money, and other resources available and the large number of rules, regulations, and norms that have to be implemented, it is important that street-level bureaucrats are able to prioritize what rules to apply, given the specific circumstances in which they operate in (Brodkin [ 6]; Maynard-Moody and Musheno ; Maynard-Moody and Portillo ). From a top-down and bottom-up perspective it can be argued that discretion has a different meaning for citizens as a client. In the top-down perspective, discretion could possibly harm the position of a citizen because private considerations and interpretations of the goals of the policy programme by the street-level bureaucrat prevent citizens being treated equally. In the bottom-up perspective, discretion will help to strengthen the value/meaningfulness of a policy for clients, as policy programmes can be targeted to their specific situation. Hence, from a bottom-up perspective discretion might increase the client meaningfulness, that is, the value of the policy for clients (Barrick et al. [ 2]; Brodkin [ 6]; May et al. ; Maynard-Moody and Musheno ; Tummers ). Client meaningfulness can be defined as the perception of street-level bureaucrats that their implementing a policy has value for their own clients. Client meaningfulness is therefore about the perception of the street - level bureaucrat that a policy is valuable for a client (the client may not feel the same way). For instance, a social worker might feel that when he/she implements a policy focused on getting clients back to work, this indeed helps the client to get employed and improves the quality of life for this client. Granting street-level bureaucrats discretion during policy implementation can increase client meaningfulness as several situations street-level bureaucrats face are too complicated to be reduced to programmatic formats. Discretion makes it possible to adapt the policy to meet the local needs of the citizens/clients, increasing the meaningfulness of the policy to clients. It seems that discretion could also positively affect the street-level bureaucrats' willingness to implement the policy . Willingness to implement is defined as a positive behavioural intention of the street-levelbureaucrat towards the implementation of the policy (Ajzen [ 1]; Metselaar ). Hence, the street-level bureaucrat aims to put effort in implementing this policy: he/she tries to make it work. Policyimplementation literature, especially the studies rooted in the bottom-up perspective, suggests that an important factor in this willingness of street-level bureaucrats is the extent to which organizations are willing and able to delegate decision-making authority to the front line (Meier and O'Toole ). This influence may be particularly pronounced in professionals whose expectations of discretion and autonomy contradict notions of bureaucratic control (Freidson ). To conclude, it seems that discretion can have various effects. In this article, we specifically examine two possible positive effects of discretion: enhanced client meaningfulness for clients and more willingness to implement the policy . These effects are chosen given their dominant role in the policy implementation debate (Ewalt and Jennings ; Riccucci ; Simon ; Tummers et al. ). The effects of discretion on client meaningfulness and willingness to implement Given the arguments stated previously, we first expect that when street-level bureaucrats experience high discretion, this positively influences their perception of client meaningfulness. Sandfort () illustrates this by describing a case in United States public welfare system (Work First contractors). Regardless of the specifics of the local office, street-level bureaucrats are given the same resources to carry out their tasks: standardized forms, policy manuals, complex computer programmes, etc. Such structures cause the street-level bureaucrats to be isolated from other professionals and unable to adapt existing practices to altering demands. Hence, it reduces their discretion and this could result in less client meaningfulness. We will study this same process using a quantitative approach, bringing us to the first hypothesis. H1: When street-level bureaucrats experience more discretion, this positively influences their experienced client meaningfulness of the policy Next, we expect that when street-level bureaucrats feel that they have enough discretion, this positively influences their willingness to implement a policy. Maynard-Moody and Portillo (, p. 259) note, 'Street-level workers rely on their discretion to manage the physical and emotional demands of their jobs. They also rely on their discretion to claim some small successes and redeem some satisfaction'. Examining this more generally, the mechanism linking discretion to willingness to implement can be traced back to the human relations movement (McGregor ). One of the central tenets of this movement is that employees have a right to give input into decisions that affect their lives. Employees enjoy carrying out decisions they have helped create. As such, the human relations movement argues that when employees experience discretion during their work, this will positively influence several job indicators by fulfilling intrinsic employee needs. Next to this, self-determination theory (Deci and Ryan ) argues that three psychological needs must be fulfilled to foster motivation: competence, relatedness, and autonomy. In short, they argue that when people perceive to have autonomy, they are more motivated to perform. H2: When street-level bureaucrats experience more discretion, this positively and directly influences their willingness to implement the policy Furthermore, we expect that when street-level bureaucrats experience more discretion, this positively influences their client meaningfulness, which in turn positively influences their willingness to implement a policy. Hence, client meaningfulness could influence the willingness to implement a policy. This is expected as street-level bureaucrats want to make a difference to their clients' lives when implementing a policy. May and Winter () found that if the front-line workers perceive the instruments at their disposal for implementing a policy as ineffective, in terms of delivering to clients, this is likely to add to their frustrations. They do not see how their implementation of the policy helps their clients, so wonder why they should implement it. Technically speaking, we expect a mediation effect to occur (Zhao et al. ). Mediation is the effect of an independent variable (here, discretion) on a dependent variable (willingness to implement) via a mediator variable (client meaningfulness). Hence, besides hypothesizing the direct effect of discretion on willingness to implement, we expect that part of this effect is caused by increasing client meaningfulness. This can be considered a partially mediated effect: part of the effect of discretion on willingness to implement is mediated by client meaningfulness. Full mediation is not expected. Some of the influence of discretion on willingness to implement is explained by factors other than increasing client meaningfulness, i.e. peoples' intrinsic need for autonomy in their work (Wagner ). H3: The positive influence of discretion on willingness to implement is partially mediated by the level of client meaningfulness This mediation effect can be related to established job design theories like the job characteristics model of Hackman and Oldham (). Hackman and Oldham noted that autonomy (related to discretion) is one of the core job characteristics, enhancing experienced responsibility for outcomes. This influences the critical psychological states, such as experienced meaningfulness of work (related to client meaningfulness). In turn, experienced meaningfulness of work fosters individual and organizational outcomes, such as high internal motivation (related to willingness to implement). Hence, important similarities between their line of reasoning and ours can be found. An important difference is that we focus on the level of policy implementation instead of the general job level. Based on these three hypotheses, a theoretical framework is constructed as shown in Figure 1. Graph: Figure 1: Proposed theoretical framework regarding two main effects of discretion METHODS Case To test the theoretical framework, we undertook a survey of Dutch mental health care professionals implementing a new reimbursement policy (Diagnosis Related Groups). First, a short overview of this policy is provided. In January 2008, the Dutch government introduced Diagnosis Related Groups (DRGs, DiagnoseBehandelingCombinaties (in Dutch), or DBC's) in mental health care. The DRGs are part of the new Law Health Market Organization. The DRGs can be seen as the introduction of regulated competition into the Dutch health care market, a move in line with new public management (NPM) ideas. More specifically, it can be seen as a shift to greater competition and more efficient use of resource (Hood , p. 5). The system of DRGs was developed as a means of determining the level of financial exchange for mental health care provision. The DRG-policy differs significantly from the former method in which each medical action resulted in a financial claim. This meant that the more sessions a professional caregiver (a psychologist, psychiatrist or psychotherapist) had with a patient, the more recompense could be claimed. This former system was considered inefficient by some (Kimberly et al. ). The DRG-policy changed the situation by stipulating a standard rate for each disorder. For instance, for a mild depression, the mental health care professional gets a standard rate and can treat the patient (direct and indirect time) between 250 and 800 min. The DRG-policy these professionals have to implement is related more to service management than to service delivery. However, this policy does have effects on service delivery. Professionals have to work in a more 'evidence-based' way and are required to account for their cost declarations in terms of the mental health DSM (Diagnostic Statistical Manual) classification system. As a result, it becomes harder to use practices that are difficult to standardize and evaluate, such as psychodynamic treatments. Discretion regarding the length of treatment is arguably also increasingly limited. Whereas, in the former system, each medical action resulted in a payment (this was not the case under the DRG-policy). Under the DRG-policy, a standard rate is determined for each disorder, meaning it has become more difficult to adjust the treatment to the specific patient needs. Hence, the number of treatments for a patient is often limited due to the DRG-policy, thereby changing service delivery. It is interesting to study how much discretion street-level bureaucrats really experienced during implementing this policy, and what effects this has. We noted that we focus on experienced discretion. Even within the same policy, some street-level bureaucrats will perceive more discretion than others. Indeed, in the open answers of the survey we witnessed that some respondents felt that they had substantial discretion when implementing this policy, while others felt very limited. Illustrative quotes from different respondents are (all from open answers in the survey, which is reported next): The DRG-policy does not force me into a certain choices. I examine the funding scheme of the treatment only 'in second instance'. I do my work first and foremost according to professional standards and hereafter just attach a DRG-label which I think fits but best. With the DRG-policy, I am being forced into a straitjacket. You are bound by the rules. So that's a harness. Sampling and response Our sampling frame comprised of 5,199 professionals who were members of two nationwide mental health care associations (the Dutch Association of Psychologists (Nederlands Instituut van Psychologen (NIP)) and the Netherlands Association for Psychiatry (Nederlandse Vereniging voor Psychiatrie (NVvP)). They were all members of those associations which could, in principle, be working with the DRG-policy. Using an email and two reminders, we received 1,317 answers of our questionnaire, i.e. a 25 per cent response. Our sampling frame comprised of high-status professionals: psychiatrists, psychologists, and psychotherapists. Most research analysing discretion focuses on traditional street-level bureaucrats, such as welfare workers and police officers (Maynard-Moody and Portillo ). However, these mental health care professionals are a specific group of highly trained professionals who traditionally, due to their professional training, have substantial autonomy. Furthermore, they also have to implement governmental policies (in this case, DRGs). Hence, it seems worthwhile to analyse such professional groups using the theoretical lens of street-level bureaucracy (see also Hupe and Hill ). Of the valid respondents, 36 per cent were men and 64 per cent were women which is consistent with Dutch averages for mental health care professionals, where 69 per cent of the workforce are female (Palm et al. ). The respondents' ages ranged from 23 to 91 years (M?=?48), which is slightly older then the Dutch national average for mental health care professionals (M?=?44). Hence, respondents' mean age and gender distribution are quite similar to those of the overall mental health care sector. To rule out a possible non-response bias, we conducted non-response research where we contacted the non-responders for their reasons for non-participation. Common reasons for not participating were: lack of time, retirement, change of occupation, or not working with the DRG-policy. Some organizations, including some hospitals, were not yet working with this policy. The large number of respondents, their characteristics in terms of gender and age, and the results of the non-response research indicate that our respondents are quite a good representation of the population. Measures This section reports the measurement of the variables. Unless stated otherwise, the measures were formatted using five-point Likert scales, ranging from strongly agree to strongly disagree. For the items tapping discretion, client meaningfulness and willingness to implement, we used templates. Templates allow the researcher to specify an item by replacing general phrases with more specific ones that better fit the research context (DeVellis ). For example, instead of stating 'the policy' or 'professionals', the researcher can rephrase these items using the specific policy and group of professionals being examined. Here, 'the DRG-policy' and 'health care professionals' replaced the template terms. Items are therefore easier for professionals to understand, since items are better tailored to their context and this, in turn, increases reliability and content validity (DeVellis , p. 62). All items are shown in Appendix 1. Discretion Discretion concerns the perceived freedom of the implementer in terms of the type, quantity and quality of sanctions, and rewards delivered (Lipsky ). The scale is based on the validated measurement instrument of policy alienation, specifically the dimension 'operational powerlessness' (Tummers ). Three items were used based on confirmatory factor analysis (CFA; see section 'Results'). Cronbach's alpha = 0.78. Client meaningfulness Client meaningfulness (or meaninglessness) was also conceptualized as a dimension of policy alienation (Tummers ). It refers to the perception of professionals about the benefits of implementing the DRG-policy for their own clients. For instance, do they perceive that they are really helping their patients by implementing this policy? Three items were used based on CFA. Cronbach's alpha = 0.77. Willingness to implement Willingness to implement was measured using Metselaar's () four-item scale. All items were used based on CFA. Cronbach's alpha = 0.83. Control variables Commonly used individual characteristics were included: gender, age, and management position (yes/no). We also distinguish between psychiatrists and others, because the former belong to a medical profession. Psychologists and psychotherapists are non-medical professionals, which possibly influenced their perceptions. Statistical method We used CFA followed by structural equation modelling (SEM). The CFA and SEM techniques are often used in psychology research, but quite new to most public administration scholars (see for instance Wright et al. ). We therefore discuss a number of the analyses' characteristics in detail. CFA is a technique used to test the factor structure of latent constructs based on theory and prior research experience. This is appropriate in our case given that prior analyses have already explored the variables discretion, client meaningfulness, and willingness to implement. It has several advantages over exploratory factor analysis, such as more stringent psychometric criteria for accepting models, thereby improving validity and reliability (Brown [ 7]). Using CFA, a measurement model is specified. The measurement model specifies the number of factors and shows how the indicators (items) relate to the various factors (Brown [ 7], p. 51). Hence, it shows for instance how the items asked to measure discretion relate to the latent construct of discretion. This measurement model is a precursor for the SEM analysis. In the SEM analysis, a structural model is constructed showing how the various latent factors relate to each other. For instance, it shows how discretion is related to willingness to implement. In this analysis, a complete model can be tested where variables can be both dependent and independent. This is an advantage over regression analyses. Given that we hypothesize that client meaningfulness is both dependent (influenced by discretion) and independent (influencing willingness to implement), this was appropriate for our model. For mediation models, as is our model, SEM is preferred over regression analysis (Zhao et al. ). The latent variable programme Mplus was used for the analyses (Muthén and Muthén, ). Mplus (http://www.statmodel.com/) is suited for handling non-normally distributed data, which is often the case when employing surveys. As our data were (mildly) non-normally distributed, this was an advantage. Robust maximum likelihood was used, which works well in these circumstances (Brown [ 7], p. 379). Measurement model Before analysing the structural model (see section 'Results'), the measurement model is analysed. Based on the analyses for the measurement model, some modifications were made to improve the model. The only modifications were to delete a number of items for the latent factors: three for discretion, one for client meaningfulness, and one for willingness to implement. This was based on theoretical grounds, fit of item content with definition of concept/latent factor, and the minimization of the Akaike information criterion (AIC). This fit index can be used to compare competing models. As suggested we selected the model with the lowest AIC, thereby taking into account theoretical plausibility (Schreiber et al. ). More specifics about the measurement model are described in Appendix 2. RESULTS Descriptive statistics Table 1 shows the means and variances/covariances for all items used. A number of interesting results can be seen. First, many street-level bureaucrats are psychiatrists and these often occupy management positions. Next, the means for discretion are quite low, showing that the street-level bureaucrats do not feel that they have a lot of autonomy in this policy. We also found low scores for willingness to implement and even lower scores for client meaningfulness. Hence, in general, the street-level bureaucrats were quite negative about this policy. The covariances for the items linked via our hypotheses are in the anticipated direction. For example, items regarding willingness to implement are positively related to discretion. 1 Mean and variance/covariance matrix (variances on the diagonal) Structural model The structural equation model is shown in Figure 2.Table 2 shows the results, including control variables. First, an effect of discretion on client meaningfulness was found (standardized coefficient 0.33, p < 0.01). Hence, we do not reject Hypothesis 1. Second, the empirical tests show a cascading effect from discretion to willingness to implement through the mediating variable client meaningfulness. The effect (standardized coefficient) of discretion on client meaningfulness was 0.33 (p < 0.01), while the effect from client meaningfulness on willingness to implement was 0.49 (p < 0.01). The total indirect effect was therefore 0.16 (0.33*0.49, p < 0.01). Based on this, we do not reject Hypothesis 3. Furthermore, the direct effect was also significant (??=?0.27, p < 0.01), thus Hypothesis 2 is not rejected. The total effect of discretion on willingness to implement is the sum of its direct and indirect effects: 0.27 + 0.16 = 0.43. This means that – all other things being equal – when the perceived discretion of the street-level bureaucrat increases by 1, the willingness to implement increases by 0.43. As there is both a direct and an indirect significant effect, there is evidence of partial mediation which was also hypothesized. This (partially mediated) model proved to be a good fit of the data: root mean square error of approximation (RMSEA) = 0.04 (criterion ? 0.08), comparative fit index (CFI) = 0.97 (criterion ? 0.90), Tucker–Lewis index (TLI) = 0.96 (criterion ? 0.90). 2 Results from structural equation modelling
|Model||Meaningfulness for clients (standardized scores)||Meaningfulness for clients (unstandardized scores)||Willingness to implement (standardized scores)||Willingness to implement (unstandardized scores)|
|Meaningfulness for clients||–||–||0.491||0.527|
|Discretion via meaningfulness for clients||–||–||0.162||0.176|
|Notes: NS = Not significant. All shown scores are significant at p < 0.01.|
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