Ownership and changes in hospital inefficiency, 1986-1991.
This study examines how ownership affected changes in hospital inefficiency after the introduction of prospective payment by Medicare. Using a national data set, we estimate cost frontiers for 1986 and 1991 to assess hospitals' efficiency relative to best practice in both those years. We then use regression analysis to determine the effect of ownership on the change in hospitals' efficiency. The results indicate that, in both 1986 and 1991, mean inefficiency was highest for for-profit hospitals and lowest for not-for-profit hospitals, with government hospitals falling in the middle. Moreover, between 1986 and 1991, both for-profit and government hospitals had significantly less improvement in efficiency than not-for-profit hospitals, all else equal.
McKay
Niccie L
NL
Department of Health Services Administration, University of Florida, Gainesville, FL 32610-0195, USA.
Deily
Mary E
ME
Dorner
Fred H
FH
D004465:Economic Competition; D017598:Efficiency, Organizational / Q000191:economics / Q000706:statistics & numerical data / Q000639:trends*; D006301:Health Services Needs and Demand; D006302:Health Services Research; D017721:Hospital Costs / Q000706:statistics & numerical data / Q000639:trends; D006777:Hospitals, Proprietary / Q000191:economics / Q000458:organization & administration* / Q000639:trends; D006779:Hospitals, Public / Q000191:economics / Q000458:organization & administration* / Q000639:trends; D006788:Hospitals, Voluntary / Q000191:economics / Q000458:organization & administration* / Q000639:trends; D008484:Medicaid; D006278:Medicare; D015233:Models, Statistical; D009936:Organizational Innovation; D010067:Ownership / Q000145:classification / Q000706:statistics & numerical data*; D011445:Prospective Payment System; D013269:Stochastic Processes; D014481:United States