Article

Hospital Quality, Efficiency, and Input Slack Differentials

Department of Health Policy & Public Health, University of the Sciences in Philadelphia, PA, USA.
Health Services Research (Impact Factor: 2.49). 10/2008; 43(5 Pt 2):1830-48. DOI: 10.1111/j.1475-6773.2008.00893.x
Source: PubMed

ABSTRACT To use an advance in data envelopment analysis (DEA) called congestion analysis to assess the trade-offs between quality and efficiency in U.S. hospitals.
Urban U.S. hospitals in 34 states operating in 2004. STUDY DESIGN AND DATA COLLECTION: Input and output data from 1,377 urban hospitals were taken from the American Hospital Association Annual Survey and the Medicare Cost Reports. Nurse-sensitive measures of quality came from the application of the Patient Safety Indicator (PSI) module of the Agency for Healthcare Research and Quality (AHRQ) Quality Indicator software to State Inpatient Databases (SID) provided by the Healthcare Cost and Utilization Project (HCUP).
In the first step of the study, hospitals' relative output-based efficiency was determined in order to obtain a measure of congestion (i.e., the productivity loss due to the occurrence of patient safety events). The outputs were adjusted to account for this productivity loss, and a second DEA was performed to obtain input slack values. Differences in slack values between unadjusted and adjusted outputs were used to measure either relative inefficiency or a need for quality improvement.
Overall, the hospitals in our sample could increase the total amount of outputs produced by an average of 26 percent by eliminating inefficiency. About 3 percent of this inefficiency can be attributed to congestion. Analysis of subsamples showed that teaching hospitals experienced no congestion loss. We found that quality of care could be improved by increasing the number of labor inputs in low-quality hospitals, whereas high-quality hospitals tended to have slack on personnel.
Results suggest that reallocation of resources could increase the relative quality among hospitals in our sample. Further, higher quality in some dimensions of care need not be achieved as a result of higher costs or through reduced access to health care.

0 Followers
 · 
117 Views
  • Source
    [Show abstract] [Hide abstract]
    ABSTRACT: Background Fiscal constraints faced by U.S. hospitals as a result of the recent economic downturn are leading to business practices that reduce costs and improve financial and operational efficiency in hospitals. There naturally arises the question of how this finance-driven management culture could affect the quality of care. This paper attempts to determine whether the process measures of treatment quality are correlated with hospital financial performance.Methods Panel study of hospital care quality and financial condition between 2005 and 2010 for cardiovascular disease treatment at acute care hospitals in the United States. Process measures for condition-specific treatment of heart attack and heart failure and hospital-level financial condition ratios were collected from the CMS databases of Hospital Compare and Cost Reports.ResultsThere is a statistically significant relationship between hospital financial performance and quality of care. Hospital profitability, financial leverage, asset liquidity, operating efficiency, and costs appear to be important factors of health care quality. In general, public hospitals provide lower quality care than their nonprofit counterparts, and urban hospitals report better quality score than those located in rural areas. Specifically, the first-difference regression results indicate that the quality of treatment for cardiovascular patients rises in the year following an increase in hospital profitability, financial leverage, and labor costs.Conclusions The results suggest that, when a hospital made more profit, had the capacity to finance investment using debt, paid higher wages presumably to attract more skilled nurses, its quality of care would generally improve. While the pursuit of profit induces hospitals to enhance both quantity and quality of services they offer, the lack of financial strength may result in a lower standard of health care services, implying the importance of monitoring the quality of care among those hospitals with poor financial health.
    BMC Health Services Research 02/2015; 15(1):45. DOI:10.1186/s12913-015-0690-x · 1.66 Impact Factor
  • [Show abstract] [Hide abstract]
    ABSTRACT: At present, health systems across Europe face the same challenges: a changing demographic profile, a rise in multi-morbidity and long-term conditions, increasing health care costs, large public debts and other legacies of an economic downturn. In light of these concerns, this article provides an overview of the international evidence on how to improve productive efficiency in secondary care settings. Updating and expanding upon a recent review of the literature by Hurst and Williams (2012), we set out evidence on potential interventions in the policy environment, hospital management, and operational processes. We conclude with five key lessons for policy makers and practitioners on how to improve productive efficiency within hospital settings, and identify several gaps in the existing evidence base.
    Health Economics Policy and Law 01/2014; 10(01):21-43. DOI:10.1017/S174413311400022X · 1.33 Impact Factor
  • Source
    [Show abstract] [Hide abstract]
    ABSTRACT: Background: Several reports have linked the 2007-2009 Great Recession in the United States with a slowdown in health care spending and decreased utilization. However, little is known regarding how the recent economic downturn affected hospital costs per inpatient stay for different segments of the population. The purpose of this study was to examine the association between changes in the unemployment rate and inpatient cost per discharge for Medicare and commercial discharges. Methods: We used retrospective data at the Core Based Statistical Area (CBSA)-level from 46 states that contributed to the Healthcare Cost and Utilization Project State Inpatient Databases from 2005 to 2010. Unemployment data was derived from the American Community Survey. An instrumental variable two-stage least squares approach with fixed- or random-effects was used to examine the association between unemployment rate and inpatient cost per discharge by payer because of potential endogeneity. Results: The marginal effect of unemployment was associated with an increase in inpatient cost per discharge for both payers. A one percentage point increase in the unemployment rate was associated with a $37 increase for commercial discharges and a $49 increase for Medicare discharges. Conclusions: We find evidence that the inpatient cost per discharge is countercyclical across different segments of the population. The underlying mechanisms by which unemployment affects hospital resource use however, might differ between payer groups.
    BMC Health Services Research 10/2014; 14(1):378. DOI:10.1186/1472-6963-14-378 · 1.66 Impact Factor

Full-text (2 Sources)

Download
167 Downloads
Available from
May 22, 2014