Multi-period state healthcare efficiency for heterogeneous parallel hospital units

Healthcare delivery in public hospitals is operated and managed individually, while performance monitoring, budget and human resource allocation are administered through the Ministry of Health state offices, reflecting the dependency between the two decision units. The geographical distribution of hospitals varies within the states of Malaysia, which requires an efficiency measurement that assesses the relationship between both the state- and hospital-level efficiencies simultaneously. The main objective of this study was to assess the performance of hospital of each decision unit at the state level. The study uses an extended multi-period parallel data envelopment analysis model to assess the multi-period performance of hospital systems, with the characteristics of heterogeneous structure, operating under the Ministry of Health state-level offices. The results showed that the efficiency score for all states ranged between 0.45 and 0.56, while the period-state weights for all states ranged between 0.30 and 0.33. The study utilizes our proposed method of aggregating the period state and hospital data for an overall state efficiency score, providing a more objective measurement compared to the arithmetic mean of efficiency scores. Such results could also be used to justify the mobilization of resources from a performing state to a less performing state. Furthermore, information on endogenous weight could assist policymakers in prioritizing strategic plans to enhance the overall performance of health services at both the hospital and state levels.