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Do mergers improve hospital productivity?

Author

Listed:
  • G D Ferrier

    (University of Arkansas, Fayetteville)

  • V G Valdmanis

    (University of the Sciences in Philadelphia)

Abstract

This paper complements the existing literature on hospital mergers by using data envelopment analysis (DEA) to generate both efficiency and productivity measures to ascertain whether hospital mergers, at least in the short run, result in performance gains. Using data over the period 1996–1998, we apply DEA, both pre-merger and post-merger, to set of hospitals that merged in 1997 as well as to a matching control group of non-merging hospitals over the same timeframe. A comparison of DEA efficiency scores and the Malmquist index values across the case and control hospitals allow us to assess whether any increase in productivity is the result of a merger rather than simply and randomly adding two hospitals' inputs and outputs together.

Suggested Citation

  • G D Ferrier & V G Valdmanis, 2004. "Do mergers improve hospital productivity?," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 55(10), pages 1071-1080, October.
    • Handle: RePEc:pal:jorsoc:v:55:y:2004:i:10:d:10.1057_palgrave.jors.2601738
    DOI: 10.1057/palgrave.jors.2601738
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    References listed on IDEAS

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