IDEAS home Printed from https://ideas.repec.org/a/gam/jijerp/v17y2019i1p82-d300350.html
   My bibliography  Save this article

Technical Efficiency of Public and Private Hospitals in Beijing, China: A Comparative Study

Author

Listed:
  • Rize Jing

    (School of Public Health, Peking University, Beijing 100083, China
    China Center for Health Development Studies, Peking University, Beijing 100083, China)

  • Tingting Xu

    (School of Public Health, Peking University, Beijing 100083, China
    Department of Social and Behavioral Science, Harvard TH Chan School of Public Health, Harvard University, 677 Huntington Avenue, Boston, MA 02115, USA)

  • Xiaozhen Lai

    (School of Public Health, Peking University, Beijing 100083, China)

  • Elham Mahmoudi

    (Department of Family Medicine, University of Michigan, Ann Arbor, MI 48109, USA)

  • Hai Fang

    (China Center for Health Development Studies, Peking University, Beijing 100083, China
    Peking University Health Science Center-Chinese Center for Disease Control and Prevention Joint Center for Vaccine Economics, Peking University, Beijing 100083, China
    Key Laboratory of Reproductive Health, National Health Commission of the People’s Republic of China, Peking University, Beijing 10083, China)

Abstract

Objective: With the participation of private hospitals in the health system, improving hospital efficiency becomes more important. This study aimed to evaluate the technical efficiency of public and private hospitals in Beijing, China, and analyze the influencing factors of hospitals’ technical efficiency, and thus provide policy implications to improve the efficiency of public and private hospitals. Method: This study used a data set of 154–232 hospitals from “Beijing’s Health and Family Planning Statistical Yearbooks” in 2012–2017. The data envelopment analysis (DEA) model was employed to measure technical efficiency. The propensity score matching (PSM) method was used for matching “post-randomization” to directly compare the efficiency of public and private hospitals, and the Tobit regression was conducted to analyze the influencing factors of technical efficiency in public and private hospitals. Results: The technical efficiency, pure technical efficiency and scale efficiency of public hospitals were higher than those of private hospitals during 2012–2017. After matching propensity scores, although the scale efficiency of public hospitals remained higher than that of their private counterparts, the pure technical efficiency of public hospitals was lower than that of private hospitals. Panel Tobit regression indicated that many hospital characteristics such as service type, level, and governance body affected public hospitals’ efficiency, while only the geographical location had an impact on private hospitals’ efficiency. For public hospitals in Beijing, those with lower average outpatient and inpatient costs per capita had better performance in technical efficiency, and bed occupancy rate, annual visits per doctor, and the ratio of doctors to nurses also showed a positive sign with technical efficiency. For private hospitals, the average length of stay was negatively associated with technical efficiency, but the bed occupancy rate, annual visits per doctor, and average outpatient cost were positively associated with technical efficiency. Conclusions: To improve technical efficiency, public hospitals should focus on improving the management standards, including the rational structure of doctors and nurses as well as appropriate reduction of hospitalization expenses. Private hospitals should expand their scale with proper restructuring, mergers, and acquisitions, and pay special attention to shortening the average length of stay and increasing the bed occupancy rate.

Suggested Citation

  • Rize Jing & Tingting Xu & Xiaozhen Lai & Elham Mahmoudi & Hai Fang, 2019. "Technical Efficiency of Public and Private Hospitals in Beijing, China: A Comparative Study," IJERPH, MDPI, vol. 17(1), pages 1-18, December.
    • Handle: RePEc:gam:jijerp:v:17:y:2019:i:1:p:82-:d:300350
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1660-4601/17/1/82/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1660-4601/17/1/82/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Eyob Zere, 2000. "Hospital Efficiency in Sub-Saharan Africa: Evidence from South Africa," WIDER Working Paper Series wp-2000-187, World Institute for Development Economic Research (UNU-WIDER).
    2. Honore, Bo E, 1992. "Trimmed LAD and Least Squares Estimation of Truncated and Censored Regression Models with Fixed Effects," Econometrica, Econometric Society, vol. 60(3), pages 533-565, May.
    3. Sloan, Frank A. & Picone, Gabriel A. & TaylorJr., Donald H. & Chou, Shin-Yi, 2001. "Hospital ownership and cost and quality of care: is there a dime's worth of difference?," Journal of Health Economics, Elsevier, vol. 20(1), pages 1-21, January.
    4. Nicholas Bloom & Carol Propper & Stephan Seiler & John Van Reenen, 2015. "The Impact of Competition on Management Quality: Evidence from Public Hospitals," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 82(2), pages 457-489.
    5. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    6. Zere, E., 2000. "Hospital Efficiency in Sub-Saharan Africa. Evidence from South Africa," Research Paper 187, World Institute for Development Economics Research.
    7. James F. Burgess, Jr. & Paul W. Wilson, 1996. "Hospital Ownership and Technical Inefficiency," Management Science, INFORMS, vol. 42(1), pages 110-123, January.
    8. Thomas Czypionka & Markus Kraus & Susanne Mayer & Gerald Röhrling, 2014. "Efficiency, ownership, and financing of hospitals: The case of Austria," Health Care Management Science, Springer, vol. 17(4), pages 331-347, December.
    9. Nicholas Bloom & Christos Genakos & Raffaella Sadun & John Van Reenen, 2011. "Management Practices Across Firms and Countries," CEP Discussion Papers dp1109, Centre for Economic Performance, LSE.
    10. Karen Eggleston & Li Ling & Meng Qingyue & Magnus Lindelow & Adam Wagstaff, 2008. "Health service delivery in China: a literature review," Health Economics, John Wiley & Sons, Ltd., vol. 17(2), pages 149-165, February.
    11. Athanassopoulos, Antreas & Gounaris, Chrysostomos, 2001. "Assessing the technical and allocative efficiency of hospital operations in Greece and its resource allocation implications," European Journal of Operational Research, Elsevier, vol. 133(2), pages 416-431, January.
    12. Daniel P. Kessler & Mark B. McClellan, 2002. "The Effects of Hospital Ownership on Medical Productivity," RAND Journal of Economics, The RAND Corporation, vol. 33(3), pages 488-506, Autumn.
    13. Panagiotis Mitropoulos & Ioannis Mitropoulos & Aris Sissouras, 2013. "Managing for efficiency in health care: the case of Greek public hospitals," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(6), pages 929-938, December.
    14. Bruce Hollingsworth, 2008. "The measurement of efficiency and productivity of health care delivery," Health Economics, John Wiley & Sons, Ltd., vol. 17(10), pages 1107-1128, October.
    15. Tiemann, Oliver & Schreyögg, Jonas & Busse, Reinhard, 2012. "Hospital ownership and efficiency: A review of studies with particular focus on Germany," Health Policy, Elsevier, vol. 104(2), pages 163-171.
    16. Barro, Jason R. & Huckman, Robert S. & Kessler, Daniel P., 2006. "The effects of cardiac specialty hospitals on the cost and quality of medical care," Journal of Health Economics, Elsevier, vol. 25(4), pages 702-721, July.
    17. H. Shelton Brown, 2003. "Managed care and technical efficiency," Health Economics, John Wiley & Sons, Ltd., vol. 12(2), pages 149-158, February.
    18. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
    19. Hu, Hsin-Hui & Qi, Qinghui & Yang, Chih-Hai, 2012. "Analysis of hospital technical efficiency in China: Effect of health insurance reform," China Economic Review, Elsevier, vol. 23(4), pages 865-877.
    20. William W. Cooper & Lawrence M. Seiford & Kaoru Tone, 2007. "Data Envelopment Analysis," Springer Books, Springer, edition 0, number 978-0-387-45283-8, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Renan Felinto de Farias Aires & Camila Cristina Rodrigues Salgado, 2022. "A Multi-Criteria Approach to Assess the Performance of the Brazilian Unified Health System," IJERPH, MDPI, vol. 19(18), pages 1-13, September.
    2. Aleksandar Medarević & Dejana Vuković, 2021. "Efficiency and Productivity of Public Hospitals in Serbia Using DEA-Malmquist Model and Tobit Regression Model, 2015–2019," IJERPH, MDPI, vol. 18(23), pages 1-22, November.
    3. Shujuan Chen & Yue Li & Yi Zheng & Binglun Wu & Ronita Bardhan & Liqun Wu, 2023. "Technical Efficiency Evaluation of Primary Health Care Institutions in Shenzhen, China, and Its Policy Implications under the COVID-19 Pandemic," IJERPH, MDPI, vol. 20(5), pages 1-21, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cláudia Araújo & Carlos Barros & Peter Wanke, 2014. "Efficiency determinants and capacity issues in Brazilian for-profit hospitals," Health Care Management Science, Springer, vol. 17(2), pages 126-138, June.
    2. George Fragkiadakis & Michael Doumpos & Constantin Zopounidis & Christophe Germain, 2016. "Operational and economic efficiency analysis of public hospitals in Greece," Post-Print hal-01414677, HAL.
    3. George Fragkiadakis & Michael Doumpos & Constantin Zopounidis & Christophe Germain, 2016. "Operational and economic efficiency analysis of public hospitals in Greece," Annals of Operations Research, Springer, vol. 247(2), pages 787-806, December.
    4. Berger, Michael & Sommersguter-Reichmann, Margit & Czypionka, Thomas, 2020. "Determinants of soft budget constraints: how public debt affects hospital performance in Austria," LSE Research Online Documents on Economics 116865, London School of Economics and Political Science, LSE Library.
    5. Akkan, Can & Karadayi, Melis Almula & Ekinci, Yeliz & Ülengin, Füsun & Uray, Nimet & Karaosmanoğlu, Elif, 2020. "Efficiency analysis of emergency departments in metropolitan areas," Socio-Economic Planning Sciences, Elsevier, vol. 69(C).
    6. Berger, Michael & Sommersguter-Reichmann, Margit & Czypionka, Thomas, 2020. "Determinants of soft budget constraints: How public debt affects hospital performance in Austria," Social Science & Medicine, Elsevier, vol. 249(C).
    7. Thomas Czypionka & Markus Kraus & Susanne Mayer & Gerald Röhrling, 2014. "Efficiency, ownership, and financing of hospitals: The case of Austria," Health Care Management Science, Springer, vol. 17(4), pages 331-347, December.
    8. Mª Isabel Ortega-Díaz & Ricardo Ocaña-Riola & Carmen Pérez-Romero & José Jesús Martín-Martín, 2020. "Multilevel Analysis of the Relationship between Ownership Structure and Technical Efficiency Frontier in the Spanish National Health System Hospitals," IJERPH, MDPI, vol. 17(16), pages 1-19, August.
    9. Jeong Hoon Choi & Imsu Park & Ilyoung Jung & Asoke Dey, 2017. "Complementary effect of patient volume and quality of care on hospital cost efficiency," Health Care Management Science, Springer, vol. 20(2), pages 221-231, June.
    10. Kao, Chiang & Pang, Rui-Zhi & Liu, Shiang-Tai & Bai, Xue-Jie, 2021. "Most productive types of hospitals: An empirical analysis," Omega, Elsevier, vol. 99(C).
    11. Alonso, José M. & Clifton, Judith & Díaz-Fuentes, Daniel, 2015. "The impact of New Public Management on efficiency: An analysis of Madrid's hospitals," Health Policy, Elsevier, vol. 119(3), pages 333-340.
    12. O'Neill, Liam & Rauner, Marion & Heidenberger, Kurt & Kraus, Markus, 2008. "A cross-national comparison and taxonomy of DEA-based hospital efficiency studies," Socio-Economic Planning Sciences, Elsevier, vol. 42(3), pages 158-189, September.
    13. Audibert, Martine & Mathonnat, Jacky & Pelissier, Aurore & Huang, Xiao Xian & Ma, Anning, 2013. "Health insurance reform and efficiency of township hospitals in rural China: An analysis from survey data," China Economic Review, Elsevier, vol. 27(C), pages 326-338.
    14. Kostas Kounetas & Fotis Papathanassopoulos, 2013. "How efficient are Greek hospitals? A case study using a double bootstrap DEA approach," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(6), pages 979-994, December.
    15. Utsav Pandey & Sanjeet Singh, 2022. "Data envelopment analysis in hierarchical category structure with fuzzy boundaries," Annals of Operations Research, Springer, vol. 315(2), pages 1517-1549, August.
    16. Yuki Kuwahara & Satoko Nagata & Atsuko Taguchi & Takashi Naruse & Hiroyuki Kawaguchi & Sachiyo Murashima, 2013. "Measuring the efficiencies of visiting nurse service agencies using data envelopment analysis," Health Care Management Science, Springer, vol. 16(3), pages 228-235, September.
    17. Färe, Rolf & Karagiannis, Giannis, 2022. "Aggregating Farrell efficiencies without value data: The case of hospitals," Socio-Economic Planning Sciences, Elsevier, vol. 84(C).
    18. Onder, O. & Cook, W. & Kristal, M., 2022. "Does quality help the financial viability of hospitals? A data envelopment analysis approach," Socio-Economic Planning Sciences, Elsevier, vol. 79(C).
    19. Bo Hsiao & Li-Hsueh Chen, 2019. "Performance Evaluation for Taiwanese Hospitals by Multi-Activity Network Data Envelopment Analysis," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 18(03), pages 1009-1043, May.
    20. Giménez, Víctor & Prieto, William & Prior, Diego & Tortosa-Ausina, Emili, 2019. "Evaluation of efficiency in Colombian hospitals: An analysis for the post-reform period," Socio-Economic Planning Sciences, Elsevier, vol. 65(C), pages 20-35.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jijerp:v:17:y:2019:i:1:p:82-:d:300350. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.