Technical Efficiency of Teaching Hospitals in Iran: The Use of Stochastic Frontier Analysis, 1999-2011

Int J Health Policy Manag 2014; 3: 91–97. doi: 10.15171/ijhpm.2014.66

7 Pages Posted: 28 Jul 2014

See all articles by Reza Goudarzi

Reza Goudarzi

Tehran University of Medical Sciences

Abolghasem Pourreza

Tehran University of Medical Sciences

Mostafa Shokoohi

Kerman University of Medical Sciences

Roohollah Askari

Tehran University of Medical Sciences

Mahdi Mahdavi

Erasmus University Rotterdam (EUR) - Institute of Health Policy and Management

Javad Moghri

Tehran University of Medical Sciences

Date Written: July 27, 2014

Abstract

Background: Hospitals are highly resource-dependent settings, which spend a large proportion of healthcare financial resources. The analysis of hospital efficiency can provide insight into how scarce resources are used to create health values. This study examines the Technical Efficiency (TE) of 12 teaching hospitals affiliated with Tehran University of Medical Sciences (TUMS) between 1999 and 2011. Methods: The Stochastic Frontier Analysis (SFA) method was applied to estimate the efficiency of TUMS hospitals. A best function, referred to as output and input parameters, was calculated for the hospitals. Number of medical doctors, nurses, and other personnel, active beds, and outpatient admissions were considered as the input variables and number of inpatient admissions as an output variable. Results: The mean level of TE was 59% (ranging from 22 to 81%). During the study period the efficiency increased from 61 to 71%. Outpatient admission, other personnel and medical doctors significantly and positively affected the production (P< 0.05). Concerning the Constant Return to Scale (CRS), an optimal production scale was found, implying that the productions of the hospitals were approximately constant. Conclusion: Findings of this study show a remarkable waste of resources in the TUMS hospital during the decade considered. This warrants policy-makers and top management in TUMS to consider steps to improve the financial management of the university hospitals.

Keywords: Hospital; Stochastic Frontier Analysis (SFA); Technical Efficiency (TE); Iran

Suggested Citation

Goudarzi, Reza and Pourreza, Abolghasem and Shokoohi, Mostafa and Askari, Roohollah and Mahdavi, Mahdi and Moghri, Javad, Technical Efficiency of Teaching Hospitals in Iran: The Use of Stochastic Frontier Analysis, 1999-2011 (July 27, 2014). Int J Health Policy Manag 2014; 3: 91–97. doi: 10.15171/ijhpm.2014.66, Available at SSRN: https://ssrn.com/abstract=2472812

Reza Goudarzi

Tehran University of Medical Sciences ( email )

Number 21, Dameshg St.
Vali-e Asr Ave.
Tehran, 14195
Iran

Abolghasem Pourreza

Tehran University of Medical Sciences ( email )

Number 21, Dameshg St.
Vali-e Asr Ave.
Tehran, 14195
Iran

Mostafa Shokoohi (Contact Author)

Kerman University of Medical Sciences ( email )

Kerman
Iran

HOME PAGE: http://ijhpm.kmu.ac.ir

Roohollah Askari

Tehran University of Medical Sciences ( email )

Number 21, Dameshg St.
Vali-e Asr Ave.
Tehran, 14195
Iran

Mahdi Mahdavi

Erasmus University Rotterdam (EUR) - Institute of Health Policy and Management ( email )

Netherlands

Javad Moghri

Tehran University of Medical Sciences ( email )

Number 21, Dameshg St.
Vali-e Asr Ave.
Tehran, 14195
Iran

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