On the estimation of hospital cost functions
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Cited by (87)
Does quality help the financial viability of hospitals? A data envelopment analysis approach
2022, Socio-Economic Planning SciencesCitation Excerpt :However, while quality of care has been shown to reduce readmission rates, this generally comes with increased costs [6,7]. Hospitals might decide to focus on attracting more patients to benefit from economies of scale to reduce costs [8,9]. This might also help them improve their quality while reducing their costs through learning by doing [10].
Assessing the effect of standardized cost systems on financial performance. A difference-in-differences approach for hospitals according to their technological level
2018, Health PolicyCitation Excerpt :Moreover, based on the previous literature, we consider additional variables as possible determinants of the evolution of unit cost: average cost of personnel [30], workers per 100 beds [30], occupancy rate [9,30,31], in-hospital mortality rate [32], teaching status [33] and acute. The hospital size (number of beds) and the complexity of the cases treated [9,10] are represented in this paper by the variables endowment of high technology and teaching status [34]. Table 1 shows how each of the variables has been measured.
How do payer mix and technical inefficiency affect hospital profit? A weighted DEA approach
2014, Operations Research for Health CareCitation Excerpt :For example, in the case of hospitals, other objectives are pursued including optimizing quality and quantity, providing social goods (i.e., teaching, see for example, [13]), maintaining safety net features (care for the poor, uninsured, and underinsured), offering highly technical and expensive services such as burn units, trauma center, and neo-natal care [14] and paying shareholders. Other factors associated with cost variability among hospitals include the maintenance of excess capacity in case of emergency [15]; the widely reported non-price competition in terms of duplication of highly technological services [16]; regulations requiring staffing ratios [17,18], and case mix of patients [19,20]. Because of the competing demands on hospitals to provide private as well as social goods, objectives such as cost minimization or profit maximization are not strictly pursued; therefore, theoretical cost (profit) functions are not appropriate.
Economies of scale and scope: A literature review in the context of hospital mergers
2014, Revista Portuguesa de Saude PublicaExamining the impact of clinical quality and clinical flexibility on cardiology unit performance - Does experiential quality act as a specialized complementary asset?
2013, Journal of Operations ManagementCitation Excerpt :We obtain information about the teaching status of a hospital from the COTH database. Past studies have found that costs and healthcare outcomes may differ across states, counties as well as urban and rural regions, due to varying practice patterns, quality of care, and case mix (Vitaliano, 1987; Thorpe, 1988; Menke, 1997; Athey and Stern, 2000; Li et al., 2002; Goldstein et al., 2002; Chandrasekaran et al., 2012). We handle this by considering a nested structure with random intercepts and random coefficients to capture differences that exist at the levels of states and counties.
Optimal productive size of hospitals intensive care units
2012, International Journal of Production EconomicsCitation Excerpt :The same arguments also prevail at the hospital level. Derivation of the optimal size of hospitals and the measure of economies of scale were analyzed, partly to justify mergers among hospitals or to show that the most productive scale size was for medium hospitals (Vita, 1990; Vitalino, 1987; Dranove, 1998). The main point of the literature on this topic is the lack of consensus among previous authors determining economies of scale, especially from a cost perspective.
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This paper was written while the author was visiting the Institute for Research in the Social Sciences and the Department of Economics and Related Studies at York University, England. The valuable comments and suggestions of Professor J.P. Hutton are gratefully acknowledged. Professor A.J. Culyer and Dr. Keith Hartley have also made useful comments. All remaining errors are, of course, the sole responsibility of the author.