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State Level Efficiency Measures for Healthcare Systems

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  • Makiela, Kamil

Abstract

This article presents a parametric approach to healthcare system productivity analysis across the USA between 2000 and 2003. Though similar productivity analyses have been made on a country level, little research is devoted to state-level healthcare efficiency analysis. Hence, the aim of this exercise is to compute the so-called technical frontier also known as the best practice frontier which represents maximum obtainable output given inputs. The difference between each state’s health level and its potentially attainable maximum denotes a given state healthcare inefficiency. The Stochastic Frontier approach used in this article allows the computation of efficiency scores as well as accounting for random disturbances in the data.

Suggested Citation

  • Makiela, Kamil, 2010. "State Level Efficiency Measures for Healthcare Systems," MPRA Paper 62172, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:62172
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    References listed on IDEAS

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    1. Afonso, Antonio & St. Aubyn, Miguel, 2005. "Non-Parametric Approaches to Education and Health Efficiency in OECD Countries," Journal of Applied Economics, Universidad del CEMA, vol. 8(2), pages 1-20, November.
    2. Fried, Harold O. & Lovell, C. A. Knox & Schmidt, Shelton S. (ed.), 2008. "The Measurement of Productive Efficiency and Productivity Growth," OUP Catalogue, Oxford University Press, number 9780195183528.
    3. Koop, Gary & Osiewalski, Jacek & Steel, Mark F J, 2000. "Modeling the Sources of Output Growth in a Panel of Countries," Journal of Business & Economic Statistics, American Statistical Association, vol. 18(3), pages 284-299, July.
    4. William Greene, 2004. "Distinguishing between heterogeneity and inefficiency: stochastic frontier analysis of the World Health Organization's panel data on national health care systems," Health Economics, John Wiley & Sons, Ltd., vol. 13(10), pages 959-980, October.
    5. Koop, Gary & Osiewalski, Jacek & Steel, Mark F. J., 1997. "Bayesian efficiency analysis through individual effects: Hospital cost frontiers," Journal of Econometrics, Elsevier, vol. 76(1-2), pages 77-105.
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    More about this item

    Keywords

    Efficiency measures; US healthcare; state productivity;
    All these keywords.

    JEL classification:

    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets

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