Academic journal article International Journal of Management

The Development and Application of a Modified Data Envelopment Analysis for Assessing the Efficiency of Different Kinds of Hospitals

Academic journal article International Journal of Management

The Development and Application of a Modified Data Envelopment Analysis for Assessing the Efficiency of Different Kinds of Hospitals

Article excerpt

The extremely competitive medical market sector in Taiwan and the National Health Insurance scheme have led to the implementation of a Global Budget System. The Data Envelopment Analysis (DEA) model is used to determine the operational efficiency of each kind of hospital found in Taiwan and to identify an improved way of allocating resources. Simple additive weighting (SAW) is revised based on the weights in the DEA model. Additionally, the performances of different hospital types are compared using the Kruskal-Wallis test. The operational efficiency scores of the different kinds of hospitals, in terms of ownership, were ranked in the following order: corporation hospitals, private hospitals, municipal hospitals, and department of health hospitals, veteran's hospitals and armed forces hospitals.

1. Introduction

The extremely competitive medical market sector in Taiwan and budget deficits incurred from the island's National Health Insurance scheme have led to the implementation of a Global Budget (GB) System. Whereas hospitals prioritize resources efficiently, the resources utility rate has received increasing attention. Hospitals must concentrate their operational efforts on retaining current patients and increasing the utility rate of those resources that the hospital already possesses. Of the relatively few studies examining the medical sector in this area, conventional approaches calculate the number of outpatients, inpatients and visits to emergency service without considering the payment policy in the GB System. The inability to effectively address the utility of resources makes the statistical approaches used to examine resource policies inaccurate. Incapable of determining the utility of resources, hospitals expend considerable costs to maintain resources and reduce the subsidized revenues from the National Health Insurance scheme, ultimately lowering their competitiveness.

How to effectively assess and to improve the use of resources has been studied recently. The studies can improve how enterprises manage tíieir resources, correct previous errors and determine how resources are allocated in the future, Chen et al. (2004). According to the widely adopted 80/20 principle of Richard Koch, an organization can yield enormous profits by using its resources efficiently. A hospital with a high degree of efficiency in its medical services is highly efficient in its use of personnel and can generate profits. Sun (2004). Based on the above studies, we can infer that utilizing resources efficiently not only enhances the management of a firm, but also promotes corporate competitiveness and increases long-term profits.

This study develops a novel assessment model to identify the utility of resources in the medical sector. More specifically, the proposed model incorporates a novel set of management strategies that emphasize allotting resources within the medical sector to strengthen a hospital's competitiveness and to comply with the GB System. To our knowledge, the performance of a hospital has not been assessed using the GB System. Besides accumulating large amounts of data, medical databases contain a wealth of potentially accessible information. Here, the Data Envelopment Analysis (DEA) model is used to determine the operational efficiency of each hospital and to identify an improved way of allocating resources. Simple additive weighting (S AW) is revised based on the weights in the DEA model. Additionally, the pertinent literature is reviewed to confirm the reliability of variables in the database. Finally the performances of different hospital types are compared using the Kruskal-Wallis test.

Analysis indicates the feasibility of adopting the proposed assessment model to design and implement precautionary measures towards the utility rate of resources in related fields. In addition to providing the medical sector with more accurate guidelines for allocating and planning operations, the proposed model can facilitate hospitals in allocating resources effectively, ultimately increasing their operating capacity. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.