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An Analysis of Organizational Performance Based on Hospital Specialization Level and Strategy Type

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  • Han-Sung Kim
  • Young-Hoon Kim
  • Jung-Sik Woo
  • Sook-Jung Hyun

Abstract

Introduction: Hospitals are studying the focused factory concept and attempting to increase their power in a competitive industry by becoming more specialized. Methodology: This study uses the information theory index (ITI) and the Herfindahl-Hirschman index (HHI) to analyze the extent of specialization by Korean hospitals that receive national health insurance reimbursements. Hierarchical regression analysis is used to assess the impact of hospital specialization on the following four aspects of operational performance: productivity, profitability, efficiency and quality of care. Study Results: The results show that a focused strategy (high HHI) improves the income and adjusted number of patients per specialist through the efficient utilization of human resources. However, a diversified strategy (high ITI) improves the hospital utilization ratio, income per bed and adjusted number of patients per bed (controlling for material resources such as beds). In addition, as the concentration index increases, case-mix mortality rates and referral rates decrease, indicating that specialization has a positive relationship with quality of care.

Suggested Citation

  • Han-Sung Kim & Young-Hoon Kim & Jung-Sik Woo & Sook-Jung Hyun, 2015. "An Analysis of Organizational Performance Based on Hospital Specialization Level and Strategy Type," PLOS ONE, Public Library of Science, vol. 10(7), pages 1-14, July.
    • Handle: RePEc:plo:pone00:0132257
    DOI: 10.1371/journal.pone.0132257
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    References listed on IDEAS

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    1. Winter, Vera & Thomsen, Mette Kjærgaard & Schreyögg, Jonas & Blankart, Katharina & Duminy, Lize & Schoenenberger, Lukas & Ansah, John P. & Matchar, David & Blankart, Carl Rudolf & Oppel, Eva & Jensen,, 2019. "Improving Service Provision - The Health Care Services' Perspective," SMR - Journal of Service Management Research, Nomos Verlagsgesellschaft mbH & Co. KG, vol. 3(4), pages 163-183.

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