Premium
Cost efficiency of US hospitals: a stochastic frontier approach
Author(s) -
Rosko Michael D.
Publication year - 2001
Publication title -
health economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.55
H-Index - 109
eISSN - 1099-1050
pISSN - 1057-9230
DOI - 10.1002/hec.607
Subject(s) - inefficiency , frontier , panel data , stochastic frontier analysis , economics , managed care , profit (economics) , econometrics , actuarial science , regression analysis , health care , demographic economics , business , operations management , microeconomics , statistics , mathematics , economic growth , production (economics) , geography , archaeology
This study examined the impact of managed care and other environmental factors on hospital inefficiency in 1631 US hospitals during the period 1990–1996. A panel, stochastic frontier regression model was used to estimate inefficiency parameters and inefficiency scores. The results suggest that mean estimated inefficiency decreased by about 28% during the study period. Inefficiency was negatively associated with health maintenance organization (HMO) penetration and industry concentration. It was positively related with Medicare share and for‐profit ownership status. Copyright © 2001 John Wiley & Sons, Ltd.