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Behavioral differences between public and private not-for-profit hospitals in the Italian national health service

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Author Info
Gian Paolo Barbetta (Istituto di Economia e Finanza, Università Cattolica di Milano, Italy)
Gilberto Turati (Dipartimento di Scienze Economiche e Finanziarie, Università di Torino, Italy)
Angelo M. Zago (Dipartimento di Scienze Economiche, Università di Verona, Italy)

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Abstract

In this paper we attempt to identify behavioral differences between public and private not-for-profit hospitals, by exploiting the introduction of the DRG-based payment system in the Italian NHS during the second half of the 1990s. We estimate the technical efficiency of a sample of hospitals for the period 1995-2000 considering an output distance function, and adopting both parametric (COLS and SF) and nonparametric (DEA) approaches. Our results show a convergence of mean efficiency scores between not-for-profit and public hospitals, and seem to suggest that differences in economic performances between competing ownership forms are more the result of the institutional settings in which they operate than the effect of the incentive structures embedded in the different proprietary forms. We also observe a decline in technical efficiency, probably due to policies aimed at reducing hospitalization rates. Copyright © 2006 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/hec.1143
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Publisher Info
Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 16 (2007)
Issue (Month): 1 ()
Pages: 75-96
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Handle: RePEc:wly:hlthec:v:16:y:2007:i:1:p:75-96

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Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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  1. Roberto Cellini & Giacomo Pignataro & Ilde Rizzo, 2000. "Competition and Efficiency in Health Care: An Analysis of the Italian Case," International Tax and Public Finance, Springer, vol. 7(4), pages 503-519, August. [Downloadable!] (restricted)
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  2. Alchian, Armen A & Demsetz, Harold, 1972. "Production , Information Costs, and Economic Organization," American Economic Review, American Economic Association, vol. 62(5), pages 777-95, December. [Downloadable!] (restricted)
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  3. Mark G. Duggan, 2000. "Hospital Ownership And Public Medical Spending," The Quarterly Journal of Economics, MIT Press, vol. 115(4), pages 1343-1373, November. [Downloadable!] (restricted)
  4. Donald F. Vitaliano & Mark Toren, 1996. "Hospital Cost and Efficiency in a Regime of Stringent Regulation," Eastern Economic Journal, Palgrave Macmillan Journals, vol. 22(2), pages 161-175, Spring. [Downloadable!] (restricted)
  5. Jondrow, James & Knox Lovell, C. A. & Materov, Ivan S. & Schmidt, Peter, 1982. "On the estimation of technical inefficiency in the stochastic frontier production function model," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 233-238, August. [Downloadable!] (restricted)
  6. Mark Duggan, 2000. "Hospital Ownership and Public Medical Spending," NBER Working Papers 7789, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  7. Silverman, Elaine & Skinner, Jonathan, 2004. "Medicare upcoding and hospital ownership," Journal of Health Economics, Elsevier, vol. 23(2), pages 369-389, March. [Downloadable!] (restricted)
  8. Glaeser, Edward L. & Shleifer, Andrei, 2001. "Not-for-profit entrepreneurs," Journal of Public Economics, Elsevier, vol. 81(1), pages 99-115, July. [Downloadable!] (restricted)
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  9. Zuckerman, Stephen & Hadley, Jack & Iezzoni, Lisa, 1994. "Measuring hospital efficiency with frontier cost functions," Journal of Health Economics, Elsevier, vol. 13(3), pages 255-280, October. [Downloadable!] (restricted)
  10. Leemore S. Dafny, 2005. "How Do Hospitals Respond to Price Changes?," American Economic Review, American Economic Association, vol. 95(5), pages 1525-1547, December. [Downloadable!] (restricted)
  11. Sloan, Frank A., 2000. "Not-for-profit ownership and hospital behavior," Handbook of Health Economics, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 21, pages 1141-1174 Elsevier. [Downloadable!] (restricted)
  12. Jaume Puig-Junoy, 1998. "Technical efficiency in the clinical management of critically ill patients," Health Economics, John Wiley & Sons, Ltd., vol. 7(3), pages 263-277.
  13. Bordignon, Massimo & Turati, Gilberto, 2003. "Bailing Out Expectations and Health Expenditure in Italy," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
  14. Miika Linna, 1998. "Measuring hospital cost efficiency with panel data models," Health Economics, John Wiley & Sons, Ltd., vol. 7(5), pages 415-427.
  15. Donald F. Vitaliano & Mark Toren, 1996. "Hospital Cost and Efficiency in a Regime of Stringent Regulation," Eastern Economic Journal, Eastern Economic Association, vol. 22(2), pages 161-175, Spring. [Downloadable!]
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