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Technical efficiency of Critical Access Hospitals: an application of the two-stage approach with double bootstrap

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  • Iustin Nedelea
  • James Fannin

Abstract

The Critical Access Hospital (CAH) Program has offered Medicare cost-based reimbursement to small hospitals that meet certain eligibility criteria to improve their financial viability and quality of care. However, cost-based reimbursement has been associated with inefficiency in hospital operations. This study uses a two-stage approach and bootstrap procedures to examine the effects of environmental variables on the technical efficiency of CAHs. The two-stage approach with quality controls significantly improved statistical efficiency of parameter estimates in the second stage bootstrapped truncated regression relative to a similar model without quality controls. Overall, our results suggest that enhanced Medicare reimbursement may not have had detrimental effects on the technical efficiency of CAHs. Copyright Springer Science+Business Media, LLC 2013

Suggested Citation

  • Iustin Nedelea & James Fannin, 2013. "Technical efficiency of Critical Access Hospitals: an application of the two-stage approach with double bootstrap," Health Care Management Science, Springer, vol. 16(1), pages 27-36, March.
    • Handle: RePEc:kap:hcarem:v:16:y:2013:i:1:p:27-36
    DOI: 10.1007/s10729-012-9209-8
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    References listed on IDEAS

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    1. Leopold Simar & Valentin Zelenyuk, 2006. "On Testing Equality of Distributions of Technical Efficiency Scores," Econometric Reviews, Taylor & Francis Journals, vol. 25(4), pages 497-522.
    2. Kneip, Alois & Park, Byeong U. & Simar, Léopold, 1998. "A Note On The Convergence Of Nonparametric Dea Estimators For Production Efficiency Scores," Econometric Theory, Cambridge University Press, vol. 14(6), pages 783-793, December.
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    4. Pavlo Demchuk & Valentin Zelenyuk, 2009. "Testing differences in efficiency of regions within a country: the case of Ukraine," Journal of Productivity Analysis, Springer, vol. 32(2), pages 81-102, October.
    5. Valentin Zelenyuk & Vitaliy Zheka, 2006. "Corporate Governance and Firm’s Efficiency: The Case of a Transitional Country, Ukraine," Journal of Productivity Analysis, Springer, vol. 25(1), pages 143-157, April.
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    Cited by:

    1. Mansour Zarrin & Jan Schoenfelder & Jens O. Brunner, 2022. "Homogeneity and Best Practice Analyses in Hospital Performance Management: An Analytical Framework," Health Care Management Science, Springer, vol. 25(3), pages 406-425, September.
    2. Kohl, Sebastian & Brunner, Jens O., 2020. "Benchmarking the benchmarks – Comparing the accuracy of Data Envelopment Analysis models in constant returns to scale settings," European Journal of Operational Research, Elsevier, vol. 285(3), pages 1042-1057.
    3. Tito N. Tiehi, 2020. "Technical Inefficiency of District Hospitals in Côte d'Ivoire: Measurement, Causes and Consequences," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 12(9), pages 1-35, September.
    4. Obure, Carol Dayo & Jacobs, Rowena & Guinness, Lorna & Mayhew, Susannah & Vassall, Anna, 2016. "Does integration of HIV and sexual and reproductive health services improve technical efficiency in Kenya and Swaziland? An application of a two-stage semi parametric approach incorporating quality me," Social Science & Medicine, Elsevier, vol. 151(C), pages 147-156.
    5. 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).
    6. Sandra G. Sosa-Rubí & Sergio Bautista-Arredondo & Carlos Chivardi-Moreno & David Contreras-Loya & Gina Hera-Fuentes & Marjorie Opuni, 2021. "Efficiency, quality, and management practices in health facilities providing outpatient HIV services in Kenya, Nigeria, Rwanda, South Africa and Zambia," Health Care Management Science, Springer, vol. 24(1), pages 41-54, March.
    7. Annika Maren Schneider & Eva-Maria Oppel & Jonas Schreyögg, 2020. "Investigating the link between medical urgency and hospital efficiency – Insights from the German hospital market," Health Care Management Science, Springer, vol. 23(4), pages 649-660, December.
    8. José Manuel Cordero & Cristina Polo & Daniel Santín & Gabriela Sicilia, 2016. "Monte-Carlo Comparison of Conditional Nonparametric Methods and Traditional Approaches to Include Exogenous Variables," Pacific Economic Review, Wiley Blackwell, vol. 21(4), pages 483-497, October.
    9. Fainman, Emily Zhu & Kucukyazici, Beste, 2020. "Design of financial incentives and payment schemes in healthcare systems: A review," Socio-Economic Planning Sciences, Elsevier, vol. 72(C).

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