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The focus efficiency of U.S. Hospitals

Author

Listed:
  • G. Ferrier

    (Department of Economics - University of Arkansas [Fayetteville])

  • H. Leleu

    (UMR CNRS 8179 - Université de Lille, Sciences et Technologies - CNRS - Centre National de la Recherche Scientifique)

  • J. Moises
  • V. Valdmanis

Abstract

Hospital productivity has been a research topic for over two decades. Whereas much has been learned regarding cost, technical, scale, and allocative efficiency as well as the impact that weakly disposable inputs/outputs have on hospital behavior, we expand on this research by examining size and service offering, or focus, efficiency at the metropolitan area level for US hospitals. By using an extension of the Free Coordination Hull (FCH), we are able to determine whether hospitals in our sample could become more efficient if they provided more services (reduce inefficiency due to too narrow a focus) or fewer services (reduce inefficiency due to too broad a focus). Our results suggest that findings vary among the hospital markets. This approach could be used by policy makers and managers in order to reduce costs by sharing services, reducing services in hospitals, or expanding services in hospitals. Findings from a study such as this should aid reform programs by providing more information on the sources of hospital inefficiency.

Suggested Citation

  • G. Ferrier & H. Leleu & J. Moises & V. Valdmanis, 2013. "The focus efficiency of U.S. Hospitals," Post-Print hal-01052726, HAL.
    • Handle: RePEc:hal:journl:hal-01052726
    DOI: 10.1007/s11293-013-9385-z
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    More about this item

    Keywords

    Hospital efficiency; Economies of scope; Focus efficiency; Free coordination hull (FCH);
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • I00 - Health, Education, and Welfare - - General - - - General

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