Efficiency Analysis of Rural Hospitals: Parametric and Semi-parametric Approaches
AbstractThis paper examined cost efficiency differences between rural hospitals participating in the Critical Access Hospital (CAH) Program and a group of non-converting, prospectively paid rural hospitals using both a two-stage semi-parametric approach as well as stochastic frontier analysis (SFA). CAHs receive Medicare cost-based reimbursement, in contrast with the rest of the hospitals reimbursed under Medicare prospective payment system (PPS). However, cost-based reimbursement has been associated with inefficiency in hospital operations and, consequently, concerns have been raised about the efficiency of CAHs. Results showed a positive and significant effect of CAH status on cost inefficiency under both model specifications suggesting that CAHs were less cost efficient than non-converting rural hospitals.
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Bibliographic InfoPaper provided by Southern Agricultural Economics Association in its series 2012 Annual Meeting, February 4-7, 2012, Birmingham, Alabama with number 119725.
Date of creation: 2012
Date of revision:
rural hospitals; efficiency; SFA; two-stage approach; Community/Rural/Urban Development; Health Economics and Policy; Production Economics; Productivity Analysis; Public Economics; Research Methods/ Statistical Methods; I18;
Find related papers by JEL classification:
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-02-08 (All new papers)
- NEP-CSE-2012-02-08 (Economics of Strategic Management)
- NEP-EFF-2012-02-08 (Efficiency & Productivity)
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