A Multi-Level Model of Institutional Innovation and Knowledge Creation Capabilities: Insights From the Development of Taiwan’s Nation Health Insurance

Abstract

This study proposes a multi-level model of institutional innovation in the healthcare sector—in other words, field-level institutional change pressures that start as network-level institutional innovation by hospitals and government for their organizational performance, with an emphasis on the effect of organizational-level construct-knowledge creation capabilities. A case study using in-depth interviews and a historical inquiry approach has been used to qualitatively analyze our cases during the development of Taiwan’s National Health Insurance (NHI). Our results propose a multi-level explanation of institutional innovation by showing how field-level institutional change pressures can stimulate the government’s institutional innovation at the network level. Moreover, knowledge creation capabilities may positively influence the government hospitals’ ongoing institutional change pressures induced institutional innovation activity for their performance at the organizational level in an institutional setting. This study contributes to health organization management researchers and administrators by developing explanations of institutional innovation and creating a much-needed multi-level insight into hospital behavior in the highly institutionalized healthcare sector.