Comparing teaching and non-teaching hospitals: a frontier approach (teaching vs. non-teaching hospitals)

Applications of data envelopment analysis in acute care hospitals: a systematic literature review, 1984-2022

This study reviews scholarly publications on data envelopment analysis (DEA) studies on acute care hospital (ACH) efficiency published between 1984 and 2022 in scholarly peer-reviewed journals. We employ systematic literature review (SLR) method to identify and analyze pertinent past research using predetermined steps. The SLR offers a comprehensive resource that meticulously analyzes DEA methodology for practitioners and researchers focusing on ACH efficiency measurement. The articles reviewed in the SLR are analyzed and synthesized based on the nature of the DEA modelling process and the key findings from the DEA models. The key findings from the DEA models are presented under the following sections: effects of different ownership structures; impacts of specific healthcare reforms or other policy interventions; international and multi-state comparisons; effects of changes in competitive environment; impacts of new technology implementations; effects of hospital location; impacts of quality management interventions; impact of COVID-19 on hospital performance; impact of teaching status, and impact of merger. Furthermore, the nature of DEA modelling process focuses on use of sensitivity analysis; choice of inputs and outputs; comparison with Stochastic Frontier Analysis; use of congestion analysis; use of bootstrapping; imposition of weight restrictions; use of DEA window analysis; and exogenous factors. The findings demonstrate that, despite several innovative DEA extensions and hospital applications, over half of the research used the conventional DEA models. The findings also show that the most often used inputs in the DEA models were labor-oriented inputs and hospital beds, whereas the most frequently used outputs were outpatient visits, followed by surgeries, admissions, and inpatient days. Further research on the impact of healthcare reforms and health information technology (HIT) on hospital performance is required, given the number of reforms being implemented in many countries and the role HIT plays in enhancing care quality and lowering costs. We conclude by offering several new research directions for future studies.

A mixed-integer slacks-based measure data envelopment analysis for efficiency measuring of German university hospitals

Standard Data Envelopment Analysis (DEA) models consider continuous-valued and known input and output statuses for measures. This paper proposes an extended Slacks-Based Measure (SBM) DEA model to accommodate flexible (a measure that can play the role of input and output) and integer measures simultaneously. A flexible measure's most appropriate role (designation) is determined by maximizing the technical efficiency of each unit. The main advantage of the proposed model is that all inputs, outputs, and flexible measures can be expressed in integer values without inflation of efficiency scores since they are directly calculated by modifying input and output inefficiencies. Furthermore, we illustrate and examine the application of the proposed models with 28 university hospitals in Germany. We investigate the differences and common properties of the proposed models with the literature to shed light on both teaching and general inefficiencies. Results of inefficiency decomposition indicate that "Third-party funding income" that university hospitals receive from the research-granting agencies dominates the other inefficiencies sources. The study of the efficiency scores is then followed up with a second-stage regression analysis based on efficiency scores and environmental factors. The result of the regression analysis confirms the conclusion derived from the inefficiency decomposition analysis.

Planning feasible and efficient operational scenarios for a university hospital through multimethodology

The COVID-19 pandemic required managerial and structural changes inside hospitals to address new admission demands, frequently reducing their care capacity for other diseases. In this regard, this study aims to support the recovery of hospital productivity in the post-pandemic context. The major challenge will be to make use of all the resources the institution has obtained (equipment, beds, temporarily hired human resources) and to increase production to meet the existing repressed demand. To support evidence-based decision-making at a major university hospital in Rio de Janeiro, hospital managers and operations research analysts designed an approach based on multiple methodologies. Besides multimethodology, one important novelty of this study is the application of a productivity frontier function to future scenario planning through the quantitative DEA methodology. Concept maps were used to structure the problem and emphasize stakeholders' perspectives. In sequence, data envelopment analysis (DEA) was applied, as it combines benchmarking best practices and assigns weights to inputs and outputs. To guarantee that the efficiency measurement considers all inputs and outputs before any inclusion of expert judgment, the scope was redirected to full dimensional efficient facet, if any, or to maximum efficient faces. The results indicate that production scenarios proposed by stakeholders based on the Ministry of Health parameters overestimate the viable production framework and that the scenario that maintains temporary human resource contracts is more compatible with quality in health provision, teaching, and research. These findings will serve as a basis for decision-making by the governmental agency that provided temporary contracts. The present methodology can be applied in different settings and scales.

Key Indicators Affecting Hospital Efficiency: A Systematic Review

Background

Measuring hospital efficiency is a systematic process to optimizing performance and resource allocation. The current review study has investigated the key input, process, and output indicators that are commonly used in measuring the technical efficiency of the hospital to promote the accuracy of the results.

Methods

To conduct this systematic review, the electronic resources and databases MEDLINE (via PubMed), Scopus, Ovid, Proquest, Google Scholar, and reference lists of the selected articles were used for searching articles between 2010 and 2019. After in-depth reviews based on the inclusion and exclusion criteria, among 1,537 studies, 144 articles were selected for the final assessment. Critical Appraisal Skills Programme (CASP) Checklist was used for evaluating the quality of the articles. The main findings of studies have been extracted using content analysis.

Results

After the final analysis, the Context/Input indicators that were commonly considered by studies in analyzing hospital technical efficiency include different variables related to Hospital Capacity, Structure, Characteristics, Market concentration, and Costs. The Process/Throughput indicators include different variables related to Hospital Activity or services-oriented process Indicators, Hospital Quality-oriented process indicators, and Hospital Educational processes. Finally, the Output/Outcome indicators include different variables related to Hospital Activity-related output variables and Quality-related output/outcomes variables.

Conclusion

This study has identified that it is necessary to mix and assess a set of input, process, and output indicators of the hospital with both quantitative and qualitative indicators for measuring the technical efficiency of hospitals comprehensively.

The contribution of resident physicians to hospital productivity

Resident physicians play a double role in hospital activity. They participate in medical practices and thus, on the one hand, they should be considered as an input. Also, they are medical staff in training and, on the other hand, must be considered as an output. The net effect on hospital activities should therefore be empirically determined. Additionally, when considering their role as active physicians, a natural hypothesis is that resident physicians are not more productive than senior ones. This is a property that standard logarithmic production functions (including Cobb-Douglas and Translog functional forms) cannot verify for the whole technology set. Our main contribution is the development of a Translog modification, which implies the definition of the input "doctors" as a weighted sum of senior and resident physicians, where the weights are estimated from the empirical application. This modification of the standard Translog is able, under suitable parameter restrictions, to verify our main hypothesis across the whole technology set while determining if the net effect of resident physicians in hospitals' production should be associated to an output or to an input. We estimate the resulting output distance function frontier with a sample of Spanish hospitals. Our findings show that the overall contribution of resident physicians to hospitals' production allows considering them as an input in most cases. In particular, their average productivity is around 37% of that corresponding to senior physicians.

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.

Determinants of transient and persistent hospital efficiency: The case of Italy

In this paper, we extend the 4-random-component closed skew-normal stochastic frontier model by including exogenous determinants of hospital persistent (long-run) and transient (short-run) inefficiency, separated from unobserved heterogeneity. We apply this new model to a dataset composed by 133 Italian hospitals during the period 2008-2013. We show that average total inefficiency is about 23%, higher than previous estimates; hence, a model where the different types of inefficiency and hospital unobserved characteristics are not confounded allows us to get less biased estimates of hospital inefficiency. Moreover, we find that transient efficiency is more important than persistent efficiency, as it accounts for 60% of the total one. Last, we find that ownership (for-profit hospitals are more transiently inefficient and less persistently inefficient than not-for-profit ones, whereas public hospitals are less transiently inefficient than not-for-profit ones), specialization (specialized hospitals are more transiently inefficient than general ones; i.e., there is evidence of scope economies in short-run efficiency), and size (large-sized hospitals are better than medium and small ones in terms of transient inefficiency) are determinants of both types of inefficiency, although we do not find any statistically significant effect of multihospital systems and teaching hospitals.

Do university hospitals perform better than general hospitals? A comparative analysis among Italian regions

OBJECTIVE

The aim of this research was to investigate how university hospitals (UHs) perform compared with general hospitals (GHs) in the Italian healthcare system.

DESIGN AND SETTING

27 indicators of overall performance were selected and analysed for UHs and GHs in 10 Italian regions. The data refer to 2012 and 2013 and were selected from two performance evaluation systems based on hospital discharge administrative data: the Inter-Regional Performance Evaluation System developed by the Management and Health Laboratory of the Scuola Superiore Sant'Anna of Pisa and the Italian National Outcome Evaluation Programme developed by the National Agency for Healthcare Services. The study was conducted in 2 stages and by combining 2 statistical techniques. In stage 1, a non-parametric Mann-Whitney U test was carried out to compare the performance of UHs and GHs on the selected set of indicators. In stage 2, a robust equal variance test between the 2 groups of hospitals was carried out to investigate differences in the amount of variability between them.

RESULTS

The overall analysis gave heterogeneous results. In general, performance was not affected by being in the UH rather than the GH group. It is thus not possible to directly associate Italian UHs with better results in terms of appropriateness, efficiency, patient satisfaction and outcomes.

CONCLUSIONS

Policymakers and managers should further encourage hospital performance evaluations in order to stimulate wider competition aimed at assigning teaching status to those hospitals that are able to meet performance requirements. In addition, UH facilities could be integrated with other providers that are responsible for community, primary and outpatient services, thereby creating a joint accountability for more patient-centred and integrated care.

Dynamic network data envelopment analysis for university hospitals evaluation

OBJECTIVE

To develop an assessment tool to evaluate the efficiency of federal university general hospitals.

METHODS

Data envelopment analysis, a linear programming technique, creates a best practice frontier by comparing observed production given the amount of resources used. The model is output-oriented and considers variable returns to scale. Network data envelopment analysis considers link variables belonging to more than one dimension (in the model, medical residents, adjusted admissions, and research projects). Dynamic network data envelopment analysis uses carry-over variables (in the model, financing budget) to analyze frontier shift in subsequent years. Data were gathered from the information system of the Brazilian Ministry of Education (MEC), 2010-2013.

RESULTS

The mean scores for health care, teaching and research over the period were 58.0%, 86.0%, and 61.0%, respectively. In 2012, the best performance year, for all units to reach the frontier it would be necessary to have a mean increase of 65.0% in outpatient visits; 34.0% in admissions; 12.0% in undergraduate students; 13.0% in multi-professional residents; 48.0% in graduate students; 7.0% in research projects; besides a decrease of 9.0% in medical residents. In the same year, an increase of 0.9% in financing budget would be necessary to improve the care output frontier. In the dynamic evaluation, there was progress in teaching efficiency, oscillation in medical care and no variation in research.

CONCLUSIONS

The proposed model generates public health planning and programming parameters by estimating efficiency scores and making projections to reach the best practice frontier.

Benchmarking hospitals through a web based platform

Purpose

– In a context of international economic crisis the improvement in the efficiency and productivity of public services is seen as a way to maintain high-quality levels at lower costs. Increased productivity can be promoted through benchmarking exercises, where key performance indicators (KPIs), individually or aggregated, are used to compare health units. The purpose of this paper is to describe a benchmarking platform, called Hospital Benchmarking (HOBE), where hospital’s services are used as the unit of analysis.

Design/methodology/approach

– HOBE platform includes a set of managerial indicators through which hospital services’ are compared. The platform also benchmarks services through aggregate service indicators, and provides an aggregate measure of hospital’s performance based on a composite indicator of the service’s performances. These aggregate indicators were obtained through data envelopment analysis (DEA).

Findings

– Some results are presented for Portuguese hospitals for the trial years of 2008 and 2009, for which data is publicly available. Details for the service-level analysis are provided for a sample hospital, as well as details on the aggregate performance resulting from services performances.

Practical implications

– HOBE’s features and outcomes show that the platform can be used to guide management actions and to support the design of health policies by administrative authorities, provided that good quality and timely data are available, and that hospitals are involved in the design of the KPIs.

Originality/value

– The platform is innovative in the sense that it bases its analysis on hospital’s services, which are in general more comparable among hospitals than indicators of hospital overall performance. In addition, it makes use of DEA to aggregate performance indicators, allowing for user choice in the inputs and outputs to be aggregated, and it proposes a novel model to aggregate service’s efficiencies into a single measure of hospital performance.

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.

Hospital employment of physicians and supply chain performance: An empirical investigation

BACKGROUND

As hospital employment of physicians becomes increasingly common in the United States, much speculation exists as to whether this type of arrangement will promote hospital operating efficiency in such areas as supply chain management. Little empirical research has been conducted to address this question.

PURPOSE

The aim of this study was to provide an exploratory assessment of whether hospital employment of physicians is associated with better supply chain performance. Drawing from both agency and stewardship theories, we examined whether hospitals with a higher proportion of employed medical staff members have relatively better supply chain performance based on two performance measures, supply chain expenses and inventory costs.

APPROACH

We conducted the study using a pooled, cross-sectional sample of hospitals located in California between 2007 and 2009. Key data sources were hospital annual financial reports from California's Office of Statewide Health Policy and Development and the American Hospital Association annual survey of hospitals. To examine the relationship between physician employment and supply chain performance, we specified physician employment as the proportion of total employed medical staff members as well as the proportion of employed medical staff members within key physician subgroups. We analyzed the data using generalized estimating equations.

FINDINGS

Study results generally supported our hypothesis that hospital employment of physicians is associated with better supply chain performance.

PRACTICAL IMPLICATIONS

Although the results of our study should be viewed as preliminary, the trend in the United States toward hospital employment of physicians may be a positive development for improved hospital operating efficiency. Hospital managers should also be attentive to training and educational resources that medical staff members may need to strengthen their role in supply chain activities.

Assessing the relationships between hospital resources and activities: a systematic review

Face the challenge of minimizing their resource utilization without reducing the quality of healthcare. Achieving this aim requires precise analysis and optimization of various inputs and outputs. This paper presents a systematic review of the relationships between hospital resources (considered productivity inputs) and financial and activity outcomes (considered productivity outputs). Several electronic bibliographic databases and the Internet were searched for articles published between January 1990 and December 2013 that examined the relationships between hospital resources and financial and activity outcomes. We assessed the quality of the study design, the nature of the sample, input and output indicators, and the statistical methods used for each selected study. Thirty-eight original papers were selected. Data Envelopment Analysis (DEA) and Stochastic Frontier Analysis (SFA) were the most statistical methods used. Based on our analysis, we retained 18 input and 19 output indicators that could constitute the basis for hospital productivity benchmarking. Selecting a small set of shared economic and activity indicators is relevant for assessing the productivity of a hospital, measuring trends and performing national or international benchmarking. Such indicators should be combined with quality measures for a comprehensive evaluation approach.

Impact of hospital teaching status on length of stay and mortality among patients undergoing complex hepatopancreaticobiliary surgery in the USA

OBJECTIVE

To define the impact of hospital teaching status on length of stay and mortality for patients undergoing complex hepatopancreaticobiliary (HPB) surgery in the USA.

METHODS

Using the Nationwide Inpatient Sample, we identified 285,442 patient records that involved a liver resection, pancreatoduodenectomy, other pancreatic resection, or hepaticojejunostomy between years 2000 and 2010. Year-wise distribution of procedures at teaching and non-teaching hospitals was described. The impact of teaching status on in-hospital mortality for operations performed at hospitals in the top tertile of procedure volume was determined using multivariate logistic regression analysis.

RESULTS

A majority of patients were under 65 years of age (59.6 %), white (74.0 %), admitted on an elective basis (77.3 %), and had a low comorbidity burden (70.5 %). Ninety percent were operated upon at hospitals in the top tertile of yearly procedure volume. Among patients undergoing an operation at a hospital in the top tertile of procedure volume (>25/year), non-teaching status was associated with an increased risk of in-hospital death (OR 1.47 [1.3, 1.7]). Other factors associated with increased risk of mortality were older patient age (OR 2.52 [2.3, 2.8]), male gender (OR 1.73 [1.6, 1.9]), higher comorbidity burden (OR 1.49 [1.3, 1.7]), non-elective admission (OR 3.32 [2.9, 4.0]), and having a complication during in-hospital stay (OR 2.53 [2.2, 3.0]), while individuals with private insurance had a lower risk of in-hospital mortality (OR 0.45 [0.4, 0.5]). After controlling for other covariates, undergoing complex HPB surgery at a non-teaching hospital remained independently associated with 32 % increased odds of death as (OR 1.32, 95 % CI 1.11-1.58; P < 0.001).

CONCLUSIONS

Even among high-volume hospitals, patients undergoing complex HPB have better outcomes at teaching vs. non-teaching hospitals. While procedural volume is an established factor associated with surgical outcomes among patients undergoing complex HPB procedures, other hospital-level factors such as teaching status have an important impact on peri-operative outcomes.

Effects of morning report case presentation on length of stay and hospitalisation costs

CONTEXT

The primary goal of discussing patient cases during the morning report is to teach appropriate clinical decision making. In addition, the selection of the best diagnostic strategy and application of evidence-based patient care are important. Reducing hospital costs is fundamental to controlling inflation in health care costs, especially in university hospitals that are subject to budget constraints in developing countries. The goal of this study was to explore the effect of morning report case presentation on length of stay (LoS) and hospitalisation costs in a university teaching hospital.

METHODS

A total of 54 patients whose cases had been presented at morning report sessions in the department of internal medicine during a 3-month period (presented group) were selected and their medical records reviewed for data on final diagnosis, hospital LoS and detailed hospital costs. A control group of 104 patients, whose cases had not been presented, were selected on the basis that their final diagnoses matched with those of the presented group. In addition, the groups were matched for age, sex, occupation, comorbidities and insurance coverage. Final diagnoses were based on International Classification of Disease 10 (ICD-10) diagnostic code criteria.

RESULTS

The mean ± standard deviation (SD) hospital LoS was 8.32 ± 4.11 days in the presented group and 10.46 ± 4.92 days in the control group (p = 0.045). Mean ± SD hospitalisation costs per patient were significantly lower in the presented group (US$553.43 ± 92.16) than the control group (US$1621.93 ± 353.14) (p = 0.004). Although costs for paraclinical services were similar, there were very significant reductions in costs for medications used during hospitalisation and bed-days (p = 0.002).

CONCLUSIONS

Discussing clinical aspects of patient cases in morning report sessions facilitates the management process and has a significant effect on LoS and hospitalisation costs in patients admitted to hospital.

Applying the Balanced Scorecard approach in teaching hospitals: a literature review and conceptual framework

Teaching hospitals (THs) simultaneously serve three different roles: offering medical treatment, teaching future doctors and promoting research. The international literature recognises such organisations as 'peaks of excellence' and highlights their economic function in the health system. In addition, the literature describes the urgent need to manage the complex dynamics and inefficiency issues that threaten the survival of teaching hospitals worldwide. In this context, traditional performance measurement systems that focus only on accounting and financial measures appear to be inadequate. Given that THs are highly specific and complex, a multidimensional system of performance measurement, such as the Balanced Scorecard (BSC), may be more appropriate because of the multitude of stakeholders, each of whom seek a specific type of accountability. The aim of the paper was twofold: (i) to review the literature on the BSC and its applications in teaching hospitals and (ii) to propose a scorecard framework that is suitable for assessing the performance of THs and serving as a guide for scholars and practitioners. In addition, this research will contribute to the ongoing debate on performance evaluation systems by suggesting a revised BSC framework and proposing specific performance indicators for THs.

Exploring health professionals' perspectives on factors affecting Iranian hospital efficiency and suggestions for improvement

While numerous studies have been undertaken in many developed countries and in a few developing countries, there has so far been no systematic attempt to identify factors affecting efficiency in the Iranian hospitals. This study was designed to elicit the perspectives of a group of health professionals and managers so as to analyse factors affecting the efficiency of hospitals owned by the Iranian Social Security Organization (SSO), which is the second largest institutional source of hospital care in that country. This study also aimed to identify actions that would improve efficiency. Using purposive sampling (to identify key informants), interviews with seventeen health professionals and hospital managers involved in the SSO health system were conducted. The respondents identified a number of organizational factors affecting efficiency, particularly the hospital budgeting and payment system used to fund physicians, and the lack of the managerial skills needed to manage complex facilities such as hospitals. The interviewees stressed the necessity for reforms of the regulatory framework to improve efficiency. A few participants recommended the concept of a funder-provider split. The results of this exploratory study have provided meaningful insight into Iranian health professionals views of factors affecting efficiency, and of possible remedial actions. It is expected that the findings will provide guidance for health policy makers and hospital managers in the Iranian SSO to analyse factors affecting efficiency and to identify remedial actions to improve efficiency. Hospitals in other developing countries may be affected by similar factors.

Redrawing medical professional domains: new doctors, shifting boundaries, and traditional force fields

PURPOSE

This paper aims to investigate the forces that influence the shifting of professional boundaries on the entry of a new medical occupation in Dutch hospitals - non-specialist emergency physicians.

DESIGN/METHODOLOGY/APPROACH

Five case studies of Dutch hospitals were conducted and the emergency physicians' implementation process was analyzed by means of force field analysis.

FINDINGS

Emergency physicians were conceptualized as being the answer to unequivocal contextual changes. However, their contribution to better performance varies due to problems in the implementation process. Strong socio-political forces between traditional specialties and these new doctors mediate the intended improvement. The emergency physicians aim to establish their own organizational-, patient- and knowledge-domain by redrawing professional boundaries but they are not on a par with the specialists who set these boundaries. Consequently, emergency physicians only gradually redraw the existing boundaries, resulting in limited added value. Their reaction is to obtain power by striving to develop into a recognized specialty; ironically, by becoming an additional layer in the traditional medical hierarchy they might lose their envisaged added value.

RESEARCH LIMITATIONS/IMPLICATIONS

This paper is based on the first Dutch hospitals that implemented emergency physicians. The number of cases is therefore limited. Moreover, the study took place at an early stage of emergency physician implementation.

PRACTICAL IMPLICATIONS

The extent of successful redrawing depends on the implementation's transition logic, the existing degree of differentiation and boundary permeability and on the ideological power developed by the leaders.

ORIGINALITY/VALUE

The introduction of emergency physicians is currently being discussed in many countries worldwide, and some countries consider following the Dutch example of non-specialist doctors. This paper supports health professionals and hospital managers in not falling prey to the same pitfalls as some Dutch hospitals.

Translating frontiers into practice: taking the next steps toward improving hospital efficiency

Frontier techniques, including data envelopment analysis (DEA) and stochastic frontier analysis (SFA), have been used to measure health care provider efficiency in hundreds of published studies. Although these methods have the potential to be useful to decision makers, their utility is limited by both methodological questions concerning their application, as well as some disconnect between the information they provide and the insight sought by decision makers. The articles in this special issue focus on the application of DEA and SFA to hospitals with the hope of making these techniques more accurate and accessible to end users. This introduction to the special issue highlights the importance of measuring the efficiency of health care providers, provides a background on frontier techniques, contains an overview of the articles in the special issue, and suggests a research agenda for DEA and SFA.

Assessment of teaching-health care integration and performance in university hospitals

OBJECTIVE

To assess the performance and integration between the health care and teaching dimensions in Brazilian university hospitals.

METHODS

A network data envelopment analysis (DEA) model was designed to measure the performance of federal university hospitals, which enables the relationship between the teaching and health care dimensions to be considered simultaneously. Data from the Ministry of Education Information System of University Hospitals, in the second semester of 2003, were used. Results of the network model were compared to those of classical DEA models to assess the advantages of the new methodological proposal.

RESULTS

The efficiency of the hospitals assessed varied between 0.19 and 1.00 (mean = 0.54). The dimensional score showed that hospitals prioritize the gain in health care efficiency. It was observed that there was a need to double the number of medical students and increase the number of residents by 14% to obtain efficiency in the teaching dimension.

CONCLUSIONS

The model was useful for both unit managers, aiming to integrate teaching and health care, and regulatory organizations, when defining policies and incentives.

Social Efficiency of Hospital Care Delivery: Frontier Analysis From the Consumer’s Perspective

The efficiency of hospital services and patients’ access to hospitals are both important health care policy issues. In the past, research has relied on studying these topics separately. In this article, we measure both efficiency and access at the same time using data envelopment analysis (DEA). By including both the technically efficient use of resources, as well as the patients’ travel distances, we found increases in social efficiency when patients’ travel distances were taken into account. When compared with patients with nonurgent conditions, we found that patients suffering from conditions requiring urgent attention were treated at closer hospitals, increasing the social efficiency. Insurance coverage and hospital ownership were also examined. Our findings corroborated past literature in the hospital and travel distance literature and set out a framework for future research. Perhaps most important, we demonstrate the techniques needed to incorporate broader measures of social costs into studies of hospital efficiency.

Productive innovations in hospitals: an empirical research on the relation between technology and productivity in the Dutch hospital industry

This paper studies the relationship between technology and productivity in Dutch hospitals. In most studies technical change is measured by a proxy, namely a time trend. In practice however, innovations slowly spread over all hospitals and so different hospitals are operating under different technologies at the same point in time. In this study we explicitly inventory specific and well-known innovations in the Dutch hospital industry in the past ten years. These innovations are aggregated into a limited number of homogenous innovation clusters, which are measured by a set of technology index numbers. The index numbers are included in the cost function specification and estimation. The results indicate that technical change is non-neutral and output- biased and that some technologies affect cost in beneficial ways.

Reforming the hospital service structure to improve efficiency: urban hospital specialization

The objective of this study is to explain the relationship between the case-mix specialization index and efficiency of inpatient hospital care services. Hospital specialization was measured using the information theory index constructed from diagnosis-related group numbers of hospitals in Seoul, Korea, in 2004. Hospital performance was measured by technical efficiency scores computed by data envelopment analysis for 2004. Multiple regression analysis models were applied to identify the internal and external factors that affected the extent of hospital specialization status as well as the efficiency of hospitals. The data envelopment analysis showed that input variables such as the number of beds, doctors and nurses were related to hospital efficiency. Hospitals had different levels of specialization in patient services, and more specialized hospitals were more likely to be efficient (odds ratio=25.95). Internal characteristics of providers had more significant effects on the extent of specialization than market conditions. These findings help to explain the relationship among hospitals, specialization, market conditions and provider performance. The study results related to the rearrangement of hospital services in a city. Further study including hospitals from other regions will increase the generalizability of results, and policy makers can use the information in making policy for the specialized hospital industry in Korea.

Measuring and comparing the (in)efficiency of German and Swiss hospitals

A nonparametric data envelopment analysis (DEA) is performed on hospitals in the federal state of Saxony (Germany) and in Switzerland. This study is of interest from three points of view. First, contrary to most existing work, patient days are not treated as an output but as an input. Second, the usual DEA assumption of a homogeneous sample is tested and rejected for a large part of the observations. The proposed solution is to restrict DEA to comparable observations in the two countries. The finding continues to be that hospitals of Saxony have higher efficiency scores than their Swiss counterparts. The finding proves robust with regard to modifications of DEA that are motivated by differences in hospital planning in Germany and Switzerland.

The decomposition of cost efficiency: an empirical application of the shadow cost function model to Dutch general hospitals

This paper investigates the performance of the Dutch general hospital industry by a parametric method. In general, the parametric approaches find more difficulties in distinguishing between technical and allocative efficiencies than DEA. Only recently a class of models is developed based on shadow prices which have possibilities to distinguish between technical and allocative efficiency. However, these models cause some serious computational problems. This paper recommends an approach to overcome these problems by using an iterative two-stage estimation procedure. The estimation is conducted on a panel data set of Dutch general hospitals. Estimation shows that this method is effective. The parameter estimates are plausible, reliable and satisfy all theoretical requirements. In particular we find some reliable estimates for the individual hospitals' shadow prices. According to these shadow prices hospitals should reallocate their resources in favor of material supplies at the cost of other personnel and nursing personnel. The mean technical efficiency is about 86%, whereas the allocative efficiency is about 92%. The outcomes also show that technical progress is very small. Economies of scale are present only for small hospitals.

Non-parametric and parametric applications measuring efficiency in health care

This paper reviews 188 published papers on frontier efficiency measurement. The techniques used are mainly based on non-parametric data envelopment analysis, but there is increasing use of parametric techniques, such as stochastic frontier analysis. Applications both to hospitals and wider health care areas are reviewed and summarised, and some meta-type analysis undertaken. Results appear to confirm earlier findings that public provision demonstrates less variability than private. The paper is meant as a resource in itself, but also points to the future in terms of possible directions for research in efficiency measurement in health care and health.