Three essays on hospital efficiency

This dissertation analyzes hospital efficiency using various econometric techniques. The first essay provides additional and recent evidence to the presence of contract management behavior in the U.S. hospital industry. Unlike previous studies, which focus on either an input-demand equation or the cost function of the firm, this paper estimates the two jointly using a system of nonlinear equations. Moreover, it addresses the longitudinal problem of institutions adopting contract management in different years, by creating a matched control group of non-adopters with the same longitudinal distribution as the group under study. The estimation procedure then finds that labor, and not capital, is the preferred input in U.S. hospitals regardless of managerial contract status. With institutions that adopt contract management benefiting from lower labor inefficiencies than the simulated non-contract adopters. These results suggest that while there is a propensity for expense preference behavior towards the labor input, contract managed firms are able to introduce efficiencies over conventional, owner controlled, firms. Using data for the years 1998 through 2007, the second essay investigates the production technology and cost efficiency faced by Florida hospitals. A stochastic frontier multiproduct cost function is estimated in order to test for economies of scale, economies of scope, and relative cost efficiencies. The results suggest that small-sized hospitals experience economies of scale, while large and medium sized institutions do not. The empirical findings show that Florida hospitals enjoy significant scope economies, regardless of size. Lastly, the evidence suggests that there is a link between hospital size and relative cost efficiency. The results of the study imply that state policy makers should be focused on increasing hospital scale for smaller institutions while facilitating the expansion of multiproduct production for larger hospitals. The third and final essay employs a two staged approach in analyzing the efficiency of hospitals in the state of Florida. In the first stage, the Banker, Charnes, and Cooper model of Data Envelopment Analysis is employed in order to derive overall technical efficiency scores for each non-specialty hospital in the state. Additionally, input slacks are calculated and reported in order to identify the factors of production that each hospital may be over utilizing. In the second stage, we employ a Tobit regression model in order to analyze the effects a number of structural, managerial, and environmental factors may have on a hospital’s efficiency. The results indicated that most non-specialty hospitals in the state are operating away from the efficient production frontier. The results also indicate that the structural make up, managerial choices, and level of competition Florida hospitals face have an impact on their overall technical efficiency.

Personal autonomy in discharge planning decision -making in mentally alert hospitalized elderly individuals: The social workers' perspective

This study was conducted to understand (a) hospital social workers' perspectives about patients' personal autonomy and self-determination, (b) their experiences, and (c) their beliefs and behaviors. The study used the maximum variation sampling strategy to select hospitals and hospital social work respondents. Individual interviews were conducted with 31 medical/surgical and mental health hospital social workers who worked in 13 hospitals. The data suggest the following four points. First, the hospital setting as an outside influence as it relates to illness and safety, and its four categories, mentally alert patients, family members, health care professionals, and social work respondents, seems to enhance or diminish patients' autonomy in discharge planning decision making. Second, respondents report they believe patients must be safe both inside and outside the hospital. In theory, respondents support autonomy and self-determination, respect patients' wishes, and believe patients are the decision makers. However, in practice, respondents respect autonomy and self-determination to a point. Third, a model, The Patient's Decision in Discharge Planning: A Continuum, is presented where a safe discharge plan is at one end of a continuum, while an unsafe discharge plan is at the other end. Respondents respect personal autonomy and the patient's self-determination to a point. This point is likely to be located in a gray area where the patient's decision crosses from one end of the continuum to the other. When patients decide on an unsafe discharge plan, workers' interventions range from autonomy to paternalism. And fourth, the hospital setting as an outside influence may not offer the best opportunity for patients to make decisions (a) because of beliefs family members and health care professionals hold about the value of patient self-determination, and (b) because patients may not feel free to make decisions in an environment where they are surrounded by family members, health care professionals, and social work respondents who have power and who think they know best. Workers need to continue to educate elderly patients about their right to self-determination in the hospital setting. ^