Perhaps Turkmenistan takes the prize:
In 2003, "President for Life" Saparmurat Niyazov decided that poor,
landlocked Turkmenistan's medical costs were too high and that its
healthcare system urgently needed reform. The country had already
suffered from a shortage of doctors, and the only qualified ones were
in cities, Niyazov said on a public radio address.
So, in a
frankly insane healthcare reform effort, he restricted the public's
access to care by replacing up to 15,000 doctors and nurses with
unqualified military conscripts. The next year, he ordered hospitals
and clinics outside of the capital, Ashgabat, to close — even though
the vast proportion of Turkmenistan's population lives in rural areas.
The BBC quoted him as saying, "Why do we need such hospitals? If people
are ill, they can come to Ashgabat." He also implemented fees and
created an "unofficial" ban on the diagnosis of certain communicable
diseases, like hepatitis.
As a result, an epidemic of the bubonic
plague reportedly broke out (Turkmenistan's highly secretive government
does not allow in organizations like the WHO) and existing rashes of
AIDS, hepatitis, and tuberculosis worsened. At the time of Niyazov's
death from a cardiac infarction in 2006, Turkmenistan had one of the
lowest life expectancies in Asia — less than 60 years.
The full story is here and it lists some other very bad health care reforms.