IDEAS home Printed from https://ideas.repec.org/a/kap/jproda/v54y2020i1d10.1007_s11123-020-00585-7.html
   My bibliography  Save this article

A non-parametric investigation of supply side factors and healthcare efficiency in the U.S

Author

Listed:
  • Richard Gearhart

    (California State University Bakersfield)

  • Nyakundi Michieka

    (California State University Bakersfield)

Abstract

In this study, the supply-side factors affecting healthcare efficiency in the U.S are studied using data between 2010 and 2017. The recently developed non-parametric order-m estimator is used for the analysis. Results suggest that the U.S. has output production that is 87.6-percent of the expected maximum amount, with life expectancy being 3 years too short given healthcare spending and education levels. However, conditioning efficiency estimates on supply-side secondary environmental variables explains 34 to 85-percent of inefficiency found in the average county. This suggests that hospital expenditures are an inefficient mechanism to improve healthcare efficiency, while focus should be placed on the number and composition of healthcare personnel. Our results suggest that lack of access to care due to provider availability is the biggest impediment to timely and successful care, and that increasing the number of primary care providers or nurse practitioners will improve poor health outcomes in many counties. This suggests that healthcare providers are the main avenues to improve healthcare inefficiency on the supply side.

Suggested Citation

  • Richard Gearhart & Nyakundi Michieka, 2020. "A non-parametric investigation of supply side factors and healthcare efficiency in the U.S," Journal of Productivity Analysis, Springer, vol. 54(1), pages 59-74, August.
    • Handle: RePEc:kap:jproda:v:54:y:2020:i:1:d:10.1007_s11123-020-00585-7
    DOI: 10.1007/s11123-020-00585-7
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11123-020-00585-7
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11123-020-00585-7?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gloria J. Bazzoli & Hsueh‐Fen Chen & Mei Zhao & Richard C. Lindrooth, 2008. "Hospital financial condition and the quality of patient care," Health Economics, John Wiley & Sons, Ltd., vol. 17(8), pages 977-995, August.
    2. Mastromarco, Camilla & Simar, Léopold, 2018. "Globalization and productivity: A robust nonparametric world frontier analysis," Economic Modelling, Elsevier, vol. 69(C), pages 134-149.
    3. Richard Gearhart & Nyakundi Michieka, 2020. "Efficiency of American states after implementation of the patient protection and affordable care act (PPACA) from 2014 to 2017," Applied Economics, Taylor & Francis Journals, vol. 52(18), pages 1959-1972, April.
    4. Cinzia Daraio & Léopold Simar, 2005. "Introducing Environmental Variables in Nonparametric Frontier Models: a Probabilistic Approach," Journal of Productivity Analysis, Springer, vol. 24(1), pages 93-121, September.
    5. Sebastian Kohl & Jan Schoenfelder & Andreas Fügener & Jens O. Brunner, 2019. "The use of Data Envelopment Analysis (DEA) in healthcare with a focus on hospitals," Health Care Management Science, Springer, vol. 22(2), pages 245-286, June.
    6. Léopold Simar & Paul Wilson, 2011. "Two-stage DEA: caveat emptor," Journal of Productivity Analysis, Springer, vol. 36(2), pages 205-218, October.
    7. Ferreira, D.C. & Marques, R.C. & Nunes, A.M., 2018. "Economies of scope in the health sector: The case of Portuguese hospitals," European Journal of Operational Research, Elsevier, vol. 266(2), pages 716-735.
    8. Kristof De Witte & Mika Kortelainen, 2013. "What explains the performance of students in a heterogeneous environment? Conditional efficiency estimation with continuous and discrete environmental variables," Applied Economics, Taylor & Francis Journals, vol. 45(17), pages 2401-2412, June.
    9. Chowdhury, Hedayet & Zelenyuk, Valentin, 2016. "Performance of hospital services in Ontario: DEA with truncated regression approach," Omega, Elsevier, vol. 63(C), pages 111-122.
    10. Gaynor, Martin & Anderson, Gerard F., 1995. "Uncertain demand, the structure of hospital costs, and the cost of empty hospital beds," Journal of Health Economics, Elsevier, vol. 14(3), pages 291-317, August.
    11. Bădin, Luiza & Daraio, Cinzia & Simar, Léopold, 2012. "How to measure the impact of environmental factors in a nonparametric production model," European Journal of Operational Research, Elsevier, vol. 223(3), pages 818-833.
    12. Cazals, Catherine & Florens, Jean-Pierre & Simar, Leopold, 2002. "Nonparametric frontier estimation: a robust approach," Journal of Econometrics, Elsevier, vol. 106(1), pages 1-25, January.
    13. Varabyova, Yauheniya & Müller, Julia-Maria, 2016. "The efficiency of health care production in OECD countries: A systematic review and meta-analysis of cross-country comparisons," Health Policy, Elsevier, vol. 120(3), pages 252-263.
    14. repec:hal:journl:peer-00796744 is not listed on IDEAS
    15. Wheelock, David C. & Wilson, Paul W., 2008. "Non-parametric, unconditional quantile estimation for efficiency analysis with an application to Federal Reserve check processing operations," Journal of Econometrics, Elsevier, vol. 145(1-2), pages 209-225, July.
    16. Gearhart, Richard & Michieka, Nyakundi, 2019. "Natural resource abundance and healthcare efficiency in Appalachia: A robust conditional approach," Energy Policy, Elsevier, vol. 129(C), pages 985-996.
    17. Ferreira, D.C. & Marques, R.C., 2019. "Do quality and access to hospital services impact on their technical efficiency?," Omega, Elsevier, vol. 86(C), pages 218-236.
    18. Simar, Leopold & Wilson, Paul W., 2007. "Estimation and inference in two-stage, semi-parametric models of production processes," Journal of Econometrics, Elsevier, vol. 136(1), pages 31-64, January.
    19. Alan Maynard, 2012. "The powers and pitfalls of payment for performance," Health Economics, John Wiley & Sons, Ltd., vol. 21(1), pages 3-12, January.
    20. Kroneman, Madelon & Siegers, Jacques J., 2004. "The effect of hospital bed reduction on the use of beds: A comparative study of 10 European countries," Social Science & Medicine, Elsevier, vol. 59(8), pages 1731-1740, October.
    21. Daouia, Abdelaati & Gijbels, Irène, 2011. "Robustness and inference in nonparametric partial frontier modeling," Journal of Econometrics, Elsevier, vol. 161(2), pages 147-165, April.
    22. Gearhart, Richard S. & Michieka, Nyakundi M., 2018. "A comparison of the robust conditional order-m estimation and two stage DEA in measuring healthcare efficiency among California counties," Economic Modelling, Elsevier, vol. 73(C), pages 395-406.
    23. Abdelaati Daouia & Irène Gijbels, 2011. "Robustness and inference in nonparametric partial-frontier modeling," Post-Print hal-00796744, HAL.
    24. Paul L Delamater & Joseph P Messina & Sue C Grady & Vince WinklerPrins & Ashton M Shortridge, 2013. "Do More Hospital Beds Lead to Higher Hospitalization Rates? A Spatial Examination of Roemer’s Law," PLOS ONE, Public Library of Science, vol. 8(2), pages 1-16, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Margit Sommersguter-Reichmann, 2022. "Health care quality in nonparametric efficiency studies: a review," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 30(1), pages 67-131, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gearhart, Richard S. & Michieka, Nyakundi M., 2018. "A comparison of the robust conditional order-m estimation and two stage DEA in measuring healthcare efficiency among California counties," Economic Modelling, Elsevier, vol. 73(C), pages 395-406.
    2. Gearhart, Richard & Michieka, Nyakundi, 2019. "Natural resource abundance and healthcare efficiency in Appalachia: A robust conditional approach," Energy Policy, Elsevier, vol. 129(C), pages 985-996.
    3. Camilla Mastromarco & Lenka Stastna & Jana Votapkova, 2019. "Efficiency of hospitals in the Czech Republic: Conditional efficiency approach," Journal of Productivity Analysis, Springer, vol. 51(1), pages 73-89, February.
    4. López-Herrera, Carmen & Cordero, José M. & Pedraja-Chaparro, Francisco & Polo, Cristina, 2023. "Fiscal rules and their influence on public sector efficiency," MPRA Paper 119018, University Library of Munich, Germany.
    5. Cordero, Jose M. & Polo, Cristina & Santín, Daniel & Simancas, Rosa, 2018. "Efficiency measurement and cross-country differences among schools: A robust conditional nonparametric analysis," Economic Modelling, Elsevier, vol. 74(C), pages 45-60.
    6. Christopher Bruffaerts & Bram De Rock & Catherine Dehon, 2013. "The Research Efficiency of US Universities: a Nonparametric Frontier Modelling Approach," Working Papers ECARES ECARES 2013-31, ULB -- Universite Libre de Bruxelles.
    7. Daraio, Cinzia & Simar, Léopold & Wilson, Paul W., 2021. "Quality as a latent heterogeneity factor in the efficiency of universities," Economic Modelling, Elsevier, vol. 99(C).
    8. López-Torres, Laura & Johnes, Jill & Elliott, Caroline & Polo, Cristina, 2021. "The effects of competition and collaboration on efficiency in the UK independent school sector," Economic Modelling, Elsevier, vol. 96(C), pages 40-53.
    9. Gearhart Richard, 2019. "The Impact of Secondary Environmental Variables on OECD Healthcare Efficiency: A Robust Conditional Approach," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 19(2), pages 1-16, April.
    10. Daraio, Cinzia & Simar, Leopold & Wilson, Paul, 2019. "Quality and its impact on efficiency," LIDAM Discussion Papers ISBA 2019004, Université catholique de Louvain, Institute of Statistics, Biostatistics and Actuarial Sciences (ISBA).
    11. Cinzia Daraio & Léopold Simar & Paul W. Wilson, 2020. "Fast and efficient computation of directional distance estimators," Annals of Operations Research, Springer, vol. 288(2), pages 805-835, May.
    12. Jose M. Cordero & Cristina Polo & Nickolaos G. Tzeremes, 2020. "Evaluating the efficiency of municipalities in the presence of unobserved heterogeneity," Journal of Productivity Analysis, Springer, vol. 53(3), pages 377-390, June.
    13. Frédérique Fève & Jean-Pierre Florens & Léopold Simar, 2023. "Proportional incremental cost probability functions and their frontiers," Empirical Economics, Springer, vol. 64(6), pages 2721-2756, June.
    14. Sushanta Mallick & Aarti Rughoo & Nickolaos G. Tzeremes & Wei Xu, 2020. "Technological Change and Catching-Up in the Indian Banking Sector: A Time-Dependent Nonparametric Frontier Approach," Computational Economics, Springer;Society for Computational Economics, vol. 56(1), pages 217-237, June.
    15. Richard Gearhart & Lyudmyla Sonchak-Ardan & Nyakundi Michieka, 2022. "The efficiency of COVID cases to COVID policies: a robust conditional approach," Empirical Economics, Springer, vol. 63(6), pages 2903-2948, December.
    16. José Manuel Cordero & Carlos Díaz Caro & Francisco Pedraja Chaparro & Cristina Polo Fernández, 2020. "Tributos cedidos y eficiencia en la gestión tributaria de las Comunidades Autónomas," Hacienda Pública Española / Review of Public Economics, IEF, vol. 232(1), pages 75-112, March.
    17. Michael L. Polemis & Thanasis Stengos & Nickolaos G. Tzeremes, 2020. "Modeling the effect of competition on US manufacturing sectors’ efficiency: an order-m frontier analysis," Journal of Productivity Analysis, Springer, vol. 54(1), pages 27-41, August.
    18. Jose M. Cordero & Francisco Pedraja-Chaparro & Elsa C. Pisaflores & Cristina Polo, 2017. "Efficiency assessment of Portuguese municipalities using a conditional nonparametric approach," Journal of Productivity Analysis, Springer, vol. 48(1), pages 1-24, August.
    19. Camilla Mastromarco & Léopold Simar, 2021. "Latent heterogeneity to evaluate the effect of human capital on world technology frontier," Journal of Productivity Analysis, Springer, vol. 55(2), pages 71-89, April.
    20. Ferreira, D.C. & Marques, R.C., 2019. "Do quality and access to hospital services impact on their technical efficiency?," Omega, Elsevier, vol. 86(C), pages 218-236.

    More about this item

    Keywords

    C14; I11; I12; I18;
    All these keywords.

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:jproda:v:54:y:2020:i:1:d:10.1007_s11123-020-00585-7. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.