The relationship between hospital specialization and hospital efficiency: do different measures of specialization lead to different results?

Exploring characteristics of specialization as moderators of the link between specialization and patient experience of care

BACKGROUND

Hospitals are increasingly pursuing specialization as a strategy to operate efficiently while delivering high-quality care. To date, however, evidence is lacking on whether hospital specialization has a consistent effect on patients' experience of care or whether different specialization characteristics influence how specialization works.

PURPOSE

This study investigates whether specialization characteristics, that is, the within-specialty concentration and the within-specialty urgency score, moderate the link between hospital specialization and patient experience of care.

METHODOLOGY

We use patient-reported and administrative data from German hospitals between 2014 and 2017, with orthopedic and trauma care as the research setting. Our sample consists of 157,458 patient observations nested within 483 hospitals. We apply random-intercept multilevel modeling.

RESULTS

Our results indicate that the effect of specialization on patient experience of care (a) decreases as the within-specialty concentration increases and (b) increases as the within-specialty urgency score increases.

CONCLUSION

This study provides novel insights into the specialization characteristics that make hospital specialization in orthopedic and trauma care particularly effective at improving patient experiences.

PRACTICE IMPLICATIONS

Although specialization is gaining popularity as a strategy for pooling scarce resources and facilitating high-quality health care, hospital managers and policymakers should consider that certain characteristics of specialization can influence the way that specialization works and how effective it is in improving patient experiences. Within the scope of orthopedic and trauma care, our study suggests that a low concentration of diagnoses within a service area and a high average level of medical urgency make specialization particularly effective at improving patient experiences.

Performance Evaluation of Combining with Medical and Old-Age Care in Pension Institutions of China: A Two-Stage Data Envelopment Analysis

Purpose

The aim of this paper was to build a performance evaluation index system for the combination of medical and old-age care services in pension institutions of China.

Methods

A two-stage data envelopment analysis (DEA) is used to evaluate the performance of 30 pension institutions in China.

Results

The results show that the two-stage DEA accounted for a relatively high affiance of medical and nursing care services, but resource allocation still needs to be further optimized. Institutions with ineffective DEA need to reduce the five factors of operations, management, fixed assets, technology and services in the input dimension.

Conclusion

In the output dimension, the service evaluation effect and safety management effect need to be improved. The performance of combined old-age care and medical care in old-age institutions can be improved in terms of investment in fixed assets, methods of capital subsidies, supervision and management, as well as standardized operations.

Multilevel Zero-One Inflated Beta Regression Model for the Analysis of the Relationship between Exogenous Health Variables and Technical Efficiency in the Spanish National Health System Hospitals

Background: This article proposes a methodological innovation in health economics for the second stage analysis of technical efficiency in hospitals. It investigates the relationship between the installed capacity in regions and hospitals and their ownership structure. Methods: A multilevel zero-one inflated beta regression model is employed to model pure technical efficiency more adequately than other models frequently used in econometrics. Results: Compared to publicly managed hospitals, the mean efficiency index of hospitals with public-private partnership (PPP) formulas was 4.27-fold. This figure was 1.90-fold for private hospitals. Concerning the efficiency frontier, the odds ratio (OR) of PPP models vs. public hospitals was 42.06. The OR of private hospitals vs. public hospitals was 8.17. A one standard deviation increase in the percentage of beds in intensive care units increases the odds of being situated on the efficiency frontier by 50%. Conclusions: The proportion of hospital beds in intensive care units relates to a higher chance of being on the efficiency frontier. Hospital ownership structure is related to the mean efficiency index of Spanish National Health Service hospitals, as well as the odds of being situated on the efficiency frontier.

Efficiency and Productivity Change of Public Hospitals in Panama: Do Management Schemes Matter?

In Latin American and Caribbean countries, the main concern of public health care managers has been traditionally placed on problems related to funding, payment mechanisms, and equity of access. However, more recently, there is a growing interest in improving the levels of efficiency and reducing costs in the provision of health services. In this paper we focus on measuring the technical efficiency and productivity change of public hospitals in Panama using bootstrapped Malmquist indices, which allows us to assess the statistical significance of changes in productivity, efficiency, and technology. Specifically, we are interested in comparing the performance of hospitals belonging to the two different management schemes coexisting in the country, the Social Security Fund (SSF) and the Ministry of Health (MoH). Our dataset includes data about 22 public hospitals (11 for each model) during the period between 2005 and 2015. The results showed that the productivity growth of hospitals belonging to the SSF has been much higher than that of the hospitals belonging to the Ministry of Health over the evaluated period (almost 4% compared to 1.5%, respectively). The main explanation for these divergences is the superior growth of technological change in the former hospitals, especially in the final years of the evaluated period.

Investigating the link between medical urgency and hospital efficiency - Insights from the German hospital market

With hospital budgets remaining tight and healthcare expenditure rising due to demographic change and advances in technology, hospitals continue to face calls to contain costs and allocate their resources more efficiently. In this context, efficiency has emerged as an increasingly important way for hospitals to withstand competitive pressures in the hospital market. Doing so, however, can be challenging given unpredictable fluctuations in demand, a prime example of which are emergencies, i.e. urgent medical cases. The link between medical urgency and hospitals' efficiency, however, has been neglected in the literature to date. This study therefore aims to investigate the relationship between hospitals' urgency characteristics and their efficiency. Our analyses are based on 4094 observations from 1428 hospitals throughout Germany for the years 2015, 2016, and 2017. We calculate an average urgency score for each hospital based on all cases treated in that hospital per year and also investigate the within-hospital dispersion of medical urgency. To analyze the association of these urgency measures with hospitals' efficiency we use a two-stage double bootstrap data envelopment analysis approach with truncated regression. We find a negative relationship between the urgency score and hospital efficiency. When testing for non-linear effects, the results reveal a u-shaped association, indicating that having either a high or low overall urgency score is beneficial in terms of efficiency. Finally, our results reveal that higher within-hospital urgency dispersion is negatively related to efficiency.

Multilevel Analysis of the Relationship between Ownership Structure and Technical Efficiency Frontier in the Spanish National Health System Hospitals

Objective: To evaluate the relationship between the ownership structure of hospitals and the possibility of their being positioned on the frontier of technical efficiency in the economic crisis period 2010–2012, adjusting for hospital variables and regional characteristics in the areas where the Spanish National Health System (SNHS) hospitals are located. Methods: 230 National Health System hospitals were studied over the two-year period 2010–2012 according to their ownership structure—public hospitals, private hospitals and public–private partnership (PPP)—data envelopment analysis orientated to inputs was used to measure the overall technical efficiency, pure efficiency and efficiency of scale. A generalised linear mixed model (GLMM) with binomial distribution and logit link function was used to analyse the hospital and regional variables associated with positioning on the frontier. Results: There are substantial differences between the average pure technical efficiency of public, private and PPP hospitals, as well as a greater number of PPP models being positioned on the efficiency frontier (91.67% in 2012). The odds of being positioned on the frontier are 41.7 times higher in PPP models than in public hospitals. The average annual household income per region is related to the greater odds of hospitals being positioned on the frontier of efficiency. Conclusions: During the most acute period of recession in the Spanish economy, PPP formulas favoured hospital efficiency, by increasing the odds of being positioned on the frontier of efficiency when compared to private and public hospitals. The position on the frontier of efficiency of a hospital is related to the wealth of its region.

The reimbursement of new medical technologies in German inpatient care: What factors explain which hospitals receive innovation payments?

Most hospital payment systems based on diagnosis-related groups (DRGs) provide payments for newly approved technologies. In Germany, they are negotiated between individual hospitals and health insurances. The aim of our study is to assess the functioning of temporary reimbursement mechanisms. We used multilevel logistic regression to examine factors at the hospital and state levels that are associated with agreeing innovation payments. Dependent variable was whether or not a hospital had successfully negotiated innovation payments in 2013 (n = 1532). Using agreement data of the yearly budget negotiations between each German hospital and representatives of the health insurances, the study comprises all German acute hospitals and innovation payments on all diagnoses. In total, 32.9% of the hospitals successfully negotiated innovation payments in 2013. We found that the chance of receiving innovation payments increased if the hospital was located in areas with a high degree of competition and if they were large, had university status and were private for-profit entities. Our study shows an implicit self-controlled selection of hospitals receiving innovation payments. While implicitly encouraging safety of patient care, policy makers should favour a more direct and transparent process of distributing innovation payments in prospective payment systems.

Road map for progress and attractiveness of Iranian hospitals by integrating self-organizing map and context-dependent DEA

Hospitals play an important role in healthcare systems and usually stay on the end node of the healthcare chain. Thus, determining their road map to get close to the desired efficiency frontier and developing short-term and long-term plans could help to manage costs and resources, efficiently. As the efficiency frontier depends on the size of the hospital and the complexity of its structure, the homogeneity in benchmarking must be considered. For tackling this problem, the self-organizing map (SOM) is used to create homogeneous groups. On the other hand, data envelopment analysis (DEA) is a well-known methodology for evaluating decision-making units. Each unit obtains the efficiency score based on the ratio of weighted outputs to weighted inputs, where each unit can take the desirable weights for inputs and outputs to provide the maximum value. One of the problems of DEA is the selection of the reference set and distinguishing between the efficient hospitals. To overcome these problems, the context-depended DEA has been applied and the progress and attractiveness of hospitals are obtained. To evaluate the capability of the proposed approach, data of 288 Iranian hospitals are utilized. By applying SOM the hospitals are clustered into appropriate homogeneous groups and by applying context-dependent DEA, the road map for progress and attractiveness of each hospital is determined. In other words, using the proposed approach the hospitals are able to determine the short and long-term goals according to their strategic plans.

Does DRG funding encourage hospital specialization? Evidence from the Italian National Health Service

The impact of diagnosis-related group (DRG)-based funding has been analyzed along a wide range of dimensions. Its effects on hospital specialization, however, have been investigated only sparsely. This paper examines such effects in the context of the Italian National Health Service, where decentralization has produced a significant degree of variation in funding arrangements. To this end, a 9-year panel data set covering 762 Italian public and private hospitals was analyzed using a finite mixture model approach. Hospital specialization was measured by the internal Herfindahl-Hirschman Index. Three variables were introduced as proxies for the choices made by Italian Regions with respect to the development and use of their DRG systems. The best finite mixture model identified three groups of hospitals, two of which sizeable. Of these, one included nearly all public hospitals, while the other was composed almost exclusively of small and medium-sized investor-owned hospitals. Averagely, private and smaller hospitals showed a stronger tendency to specialize over time. The positive impact of DRG funding on the hospitals' propensity to specialize found only limited empirical support. Moreover, it emerged as comparatively much smaller for public hospitals vis à vis private ones.

A performance analysis of Brazilian public health: TOPSIS and neural networks application

Purpose

The purpose of this paper is to estimate the performance of Brazilian hospitals’ services and to examine contextual variables in the socioeconomic, demographic and institutional domains as predictors of the performance levels attained.

Design/methodology/approach

The paper applied a two-stage approach of the technique for order preference by similarity to the ideal solution (TOPSIS) in public hospitals in 92 Rio de Janeiro municipalities, covering the 2008–2013 period. First, TOPSIS is used to estimate the relative performance of hospitals in each municipality. Next, TOPSIS results are combined with neural networks in an effort to originate a performance model with predictive ability. Data refer to hospitals’ outpatient and inpatient services, based on frequent indicators adopted by the healthcare literature.

Findings

Despite a slight performance increase over the period, substantial room for improvement is observed. The most important performance predictors were related to the demographic and socioeconomic status (area in square feet and GDP per capita) and to the juridical nature and type of ownership of the healthcare facilities (number of federal and private hospitals).

Practical implications

The results provide managerial insights regarding the performance of public hospitals and opportunities for better resource allocation in the healthcare sector. The paper also considers the impact of external socioeconomic, demographic and institutional factors on hospitals’ performance, indicating the importance of integrative public health policies.

Originality/value

This study displays an innovative context for applying the two-stage TOPSIS technique, with similar efforts not having been identified in the healthcare literature.

Quality and resource efficiency in hospital service provision: A geoadditive stochastic frontier analysis of stroke quality of care in Germany

We specify a Bayesian, geoadditive Stochastic Frontier Analysis (SFA) model to assess hospital performance along the dimensions of resources and quality of stroke care in German hospitals. With 1,100 annual observations and data from 2006 to 2013 and risk-adjusted patient volume as output, we introduce a production function that captures quality, resource inputs, hospital inefficiency determinants and spatial patterns of inefficiencies. With high relevance for hospital management and health system regulators, we identify performance improvement mechanisms by considering marginal effects for the average hospital. Specialization and certification can substantially reduce mortality. Regional and hospital-level concentration can improve quality and resource efficiency. Finally, our results demonstrate a trade-off between quality improvement and resource reduction and substantial regional variation in efficiency.

Do private hospitals outperform public hospitals regarding efficiency, accessibility, and quality of care in the European Union? A literature review

European countries have enhanced the scope of private provision within their health care systems. Privatizing services have been suggested as a means to improve access, quality, and efficiency in health care. This raises questions about the relative performance of private hospitals compared with public hospitals. Most systematic reviews that scrutinize the performance of the private hospitals originate from the United States. A systematic overview for Europe is nonexisting. We fill this gap with a systematic realist review comparing the performance of public hospitals to private hospitals on efficiency, accessibility, and quality of care in the European Union. This review synthesizes evidence from Italy, Germany, the United Kingdom, France, Greece, Austria, Spain, and Portugal. Most evidence suggests that public hospitals are at least as efficient as or are more efficient than private hospitals. Accessibility to broader populations is often a matter of concern in private provision: Patients with higher social-economic backgrounds hold better access to private hospital provision, especially in private parallel systems such as the United Kingdom and Greece. The existing evidence on quality of care is often too diverse to make a conclusive statement. In conclusion, the growth in private hospital provision seems not related to improvements in performance in Europe. Our evidence further suggests that the private (for-profit) hospital sector seems to react more strongly to (financial) incentives than other provider types. In such cases, policymakers either should very carefully develop adequate incentive structures or be hesitant to accommodate the growth of the private hospital sector.

Hospital Charges and Continuity of Care for Outpatients with Hypertension in South Korea: A Nationwide Population-Based Cohort Study from 2002 to 2013

Background

Continuity of care (COC) has received attention over the past decade. COC has also become increasingly important for hospital managers and policy makers because of competitive health care market conditions. The purpose of this study was to assess the association between hospital charges and patients' continuity of care-assessed by three indices of continuity of care—among outpatients with hypertension in South Korea.

Methods

This study used the National Health Insurance Service–Cohort Sample Database from 2002 to 2013. A total of 247,125 participants were analyzed at baseline (2002); continuity of care was defined using the continuity of care index, the Herfindahl–Hirschman index (a new continuity of care index), and the “most frequent provider continuity” index. Primary analyses were based on the generalized estimating equation regression model, which accounts for correlation among individuals within each hospital.

Results

After adjustment for age, sex, residential region, patient clinical complexity level, diagnosed code, hospital type, organization type, number of beds, number of doctors, and year, there was a negative correlation between hospital charges and continuity of care index (β=−0.163, P<0.0001), the Herfindahl–Hirschman index (β=−0.105, P<0.0001), and the “most frequent provider continuity” index (β=−0.131, P<0.0001). Subgroup analyses based on hospital type produced similar trends.

Conclusion

For all indices studied, hospital charges declined gradually with increasing continuity of care. Our study suggests that long-term, trusting partnerships between patients and physicians reduce hospital costs.

Identifying congestion levels, sources and determinants on intensive care units: the Portuguese case

Healthcare systems are facing a resources scarcity so they must be efficiently managed. On the other hand, it is commonly accepted that the higher the consumed resources, the higher the hospital production, although this is not true in practice. Congestion on inputs is an economic concept dealing with such situation and it is defined as the decreasing of outputs due to some resources overuse. This scenario gets worse when inpatients' high severity requires a strict and effective resources management, as happens in Intensive Care Units (ICU). The present paper employs a set of nonparametric models to evaluate congestion levels, sources and determinants in Portuguese Intensive Care Units. Nonparametric models based on Data Envelopment Analysis are employed to assess both radial and non-radial (in)efficiency levels and sources. The environment adjustment models and bootstrapping are used to correct possible bias, to remove the deterministic nature of nonparametric models and to get a statistical background on results. Considerable inefficiency and congestion levels were identified, as well as the congestion determinants, including the ICU specialty and complexity, the hospital differentiation degree and population demography. Both the costs associated with staff and the length of stay are the main sources of (weak) congestion in ICUs. ICUs management shall make some efforts towards resource allocation to prevent the congestion effect. Those efforts shall, in general, be focused on costs with staff and hospital days, although these congestion sources may vary across hospitals and ICU services, once several congestion determinants were identified.

Factors affecting the technical efficiency of general hospitals in Iran: data envelopment analysis

BACKGROUND

Restrictions on resource accessibility and its optimal application is the main challenge in organizations nowadays. The aim of this research was to study the technical efficiency and its related factors in Tehran general hospitals.

MATERIALS AND METHODS

This descriptive analytical study was conducted retrospectively in 2014. Fifty-four hospitals with private, university, and social security ownerships from the total 110 general hospitals were randomly selected for inclusion into this study on the basis of the share of ownership. Data were collected using a checklist with three sections, including background variables, inputs, and outputs.

RESULTS

Seventeen (31.48%) hospitals had an efficiency score of 1 (highest efficiency score). The highest average efficiency score was in social security hospitals (84.32). Private and university hospitals ranked next with an average of 84.29 and 79.64, respectively. Analytical results showed that there was a significant relationship between hospital ownership, hospital type in terms of duty and specialization, educational field of the chief executive officer, and technical efficiency. There was no significant relationship between education level of hospital manager and technical efficiency.

CONCLUSION AND RECOMMENDATIONS

Most of the studied hospitals were operating at low efficiency. Therefore, policymakers should plan to improve the hospital operations and promote hospitals to an optimal level of efficiency.