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Assessing the Efficiency of Hong Kong Public Hospital Sector During the COVID-19 Pandemic: An Input-oriented Structural Efficiency Approach

Author

Listed:
  • TSANG, Chun Kei

    (Department of Economics and Finance, Hong Kong Shue Yan University
    Business, Economic and Public Policy Research Centre, Hong Kong Shue Yan University)

  • LI, Sung Ko

    (Department of Economics and Finance, Hong Kong Shue Yan University
    Business, Economic and Public Policy Research Centre, Hong Kong Shue Yan University
    Centre for Sustainable Development Studies, Hong Kong Baptist University)

  • LEE, Shu Kam

    (Author-Workplace-Name: Department of Economics and Finance, Hong Kong Shue Yan University
    Business, Economic and Public Policy Research Centre, Hong Kong Shue Yan University)

Abstract

[Purpose] The available literature on the impact of COVID-19 on the healthcare system is relatively limited. This paper aims to evaluate the efficiency of the public hospital sector in Hong Kong during the COVID-19 pandemic. [Design/methodology/approach] One characteristic of the Hong Kong public hospital sector is the cluster-based management model. This paper developed an input-oriented structural efficiency measure with subgroups not yet documented in the literature. This measure is then applied to the data from 38 public hospitals in 7 hospital clusters managed by the Hong Kong Hospital Authority (HA) from fiscal year 2017-18 to 2022-2023. The study contributes to the field of Decision Sciences by applying and extending Data Envelopment Analysis (DEA), a core operations research technique, to provide actionable insights for strategic planning and resource allocation in public health systems. [Findings] The results show that the excess resource usage of the whole hospital sector increased from around 24% before the pandemic to around 40% during the late pandemic period. The results further reveal that it mainly originated from the inefficiency within individual hospitals. Resource allocation among hospital clusters is very efficient, whether before or during the COVID-19 pandemic. However, resource allocation within hospital clusters worsened in three clusters but improved in another three clusters. [Originality/value] This paper makes an original contribution by developing and applying a novel input-oriented structural efficiency measure that accommodates subgroups, a methodology not previously documented in the literature for this context. By applying the new measure developed, this paper evaluates the efficiency of the Hong Kong public hospital sector during the COVID-19 pandemic and decomposes such inefficiency into individual hospital clusters and levels of the public hospital sector.

Suggested Citation

  • TSANG, Chun Kei & LI, Sung Ko & LEE, Shu Kam, 2024. "Assessing the Efficiency of Hong Kong Public Hospital Sector During the COVID-19 Pandemic: An Input-oriented Structural Efficiency Approach," Advances in Decision Sciences, Asia University, Taiwan, vol. 28(4), pages 50-73, December.
    • Handle: RePEc:aag:wpaper:v:28:y:2024:i:4:p:50-73
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    References listed on IDEAS

    as
    1. Li, Sung-ko & Cheng, Yuk-shing, 2007. "Solving the puzzles of structural efficiency," European Journal of Operational Research, Elsevier, vol. 180(2), pages 713-722, July.
    2. Chun-kei Tsang & Sung-ko Li, 2020. "Allocation of resources within subgroups of an industry: a case study in the Chinese industrial sector," Journal of Productivity Analysis, Springer, vol. 53(1), pages 125-139, February.
    3. Thomas, J. William & Griffith, John R. & Durance, Paul, 1981. "Defining hospital clusters and associated service communities in metropolitan areas," Socio-Economic Planning Sciences, Elsevier, vol. 15(2), pages 45-51.
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    JEL classification:

    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship

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