RESUMO
This study discuses and focuses on the applicability of internal market reform within the context of Federal hospitals in Sudan. The objective of the study is to test the effect of internal market reform in remedying the widely acknowledged inefficiencies, while maintaining cost and accessbility. The study is a prescriptive study; it critically analyzed the context of federal hospitals against a wide range of internaitonal experiences from developed and developing countries. The countries experiences showed that there was no single right model for reform; the reform has to be considered with respect to the country specific context. The study concluded the internl market reform mechanisms on the supply side could be applied. A model was designed in which a governing body of the federal hospitals could be entrusted as a purchaser of hospital services and federal hospitals are to take trust status. The model adopted the concept of separation of finance from provision, and patient choice of providers. Theoretical evidences showed that the model could have a positive effect on efficiency and acessibility to hospital care. Budget ceiling was proposed as an important factor to safe guard against cost escalation. The study excluded internal market reforms on the finance side