Article

The effect of activity-based financing on hospital efficiency: a panel data analysis of DEA efficiency scores 1992-2000.

Department of Economics, University of Oslo, PO Box 1095 Blindern, NO-0317 Oslo, Norway.
Health Care Management Science (Impact Factor: 1.05). 12/2003; 6(4):271-83. DOI: 10.1023/A:1026212820367
Source: PubMed

ABSTRACT Activity-based financing (ABF) was implemented in the Norwegian hospital sector from 1 July 1997. A fraction of the block grant from the state to the county councils has been replaced by a matching grant depending upon the number and composition of hospital treatments. As a result of the reform, the majority of county councils have introduced activity-based contracts with their hospitals. This paper studies the effect of activity-based funding on hospital efficiency. We predict that hospital efficiency will increase because the benefit from cost-reducing efforts in terms of number of treated patients is increased under ABF as compared with global budgets. The prediction is tested using a panel data set from the period 1992-2000. Efficiency indicators are estimated by means of data envelopment analysis (DEA) with multiple inputs and outputs. Using a variety of econometric methods, we find that the introduction of ABF has improved efficiency when measured as technical efficiency according to DEA analysis. The result is less uniform with respect to the effect on cost-efficiency.

0 Bookmarks
 · 
83 Views
  • [Show abstract] [Hide abstract]
    ABSTRACT: 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.
    Journal of Medical Systems 10/2014; 38(10):127. · 1.37 Impact Factor
  • Source
    [Show abstract] [Hide abstract]
    ABSTRACT: Performance measurement is essential to the management of health care organizations to which efficiency is per se a vital indicator. The main purpose of this study is to measure the technical and scale efficiency of hospitals in Tunisia. Data Envelopment Analysis (Computer) Program (DEAP) was applied to calculate the technical and scale efficiency of all 30 public hospitals during 2008-2012. Data was extracted from all 30 hospitals via the Hospital Information Systems (HIS), within the hospitals' admission and discharge units. The yearly analysis has revealed that 17 (57%), 17 (57%), 12 (40%), 10 (33%) and 8 (27%) of the hospitals were run inefficiently in 2008, 2009, 2010, 2011 and 2012 respectively, and they needed to either increase their outputs in order to become efficient. The average technical efficiency scores were 61%, 63%, 76%, 78% and 85% respectively during the years under consideration. There is some scope for providing outpatient curative and preventive care and inpatient care to extra patients without additional investment into the abovementioned health services. This would entail leveraging of health promotion approaches and lowering of financial barriers to access to boost the consumption of underutilized health services, especially health promotion and disease prevention services.
    2013 Applied Health Economics and Policy Conference (AHEPC 2013), Sanya, China; 11/2013
  • Source
    [Show abstract] [Hide abstract]
    ABSTRACT: With Japanese hospital financing reform, a prospective payment system (PPS) has been established for inpatient care to replace the traditional fee-for-service remuneration of hospitals. This paper evaluates the effect of the reform on technical and cost efficiency of local public hospitals. Efficiency is estimated non-parametrically using two-stage data envelopment analysis with bias correction through bootstrap, and parametrically applying stochastic frontier analysis. The descriptive analysis shows that efficiency declines after the introduction of PPS. Difference-in-difference estimations reveal that PPS results in a limited efficiency gain, which might be related to inadequate incentives created by the two-part PPS tariff in Japan.
    Japanese Economic Review 09/2013; 64(3). · 0.27 Impact Factor

Full-text (2 Sources)

Download
46 Downloads
Available from
May 31, 2014