IDEAS home Printed from https://ideas.repec.org/a/wly/hlthec/v13y2004i12p1149-1165.html
   My bibliography  Save this article

Cost efficiency in primary care contracting: a stochastic frontier cost function approach

Author

Listed:
  • Jaume Puig‐Junoy
  • Vicente Ortún

Abstract

The principal aim of this paper is to estimate a stochastic frontier cost function and an inefficiency effects model in the analysis of the primary health‐care services purchased by the public authority and supplied by 180 providers in 1996 in Catalonia. The evidence from our sample does not support the premise that contracting out has helped improve purchasing cost efficiency in primary care. Inefficient purchasing cost was observed in the component of this purchasing cost explicitly included in the contract between purchaser and provider. There were no observable incentives for the contracted‐out primary health‐care teams to minimise prescription costs, which were not explicitly included in the contracting system. Copyright © 2004 John Wiley & Sons, Ltd.

Suggested Citation

  • Jaume Puig‐Junoy & Vicente Ortún, 2004. "Cost efficiency in primary care contracting: a stochastic frontier cost function approach," Health Economics, John Wiley & Sons, Ltd., vol. 13(12), pages 1149-1165, December.
    • Handle: RePEc:wly:hlthec:v:13:y:2004:i:12:p:1149-1165
    DOI: 10.1002/hec.883
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/hec.883
    Download Restriction: no
    File URL: https://libkey.io/10.1002/hec.883?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
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Rodriguez, Marisol & Scheffler, Richard M. & Agnew, Jonathan D., 2000. "An update on Spain's health care system: is it time for managed competition?," Health Policy, Elsevier, vol. 51(2), pages 109-131, March.
    2. Kumbhakar, Subal C. & Heshmati, Almas & Hjalmarsson, Lennart, 1997. "Temporal patterns of technical efficiency: Results from competing models," International Journal of Industrial Organization, Elsevier, vol. 15(5), pages 597-616, August.
    3. Jondrow, James & Knox Lovell, C. A. & Materov, Ivan S. & Schmidt, Peter, 1982. "On the estimation of technical inefficiency in the stochastic frontier production function model," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 233-238, August.
    4. Battese, George E. & Coelli, Tim J., 1988. "Prediction of firm-level technical efficiencies with a generalized frontier production function and panel data," Journal of Econometrics, Elsevier, vol. 38(3), pages 387-399, July.
    5. Antonio Giuffrida & Hugh Gravelle, 2001. "Measuring performance in primary care: econometric analysis and DEA," Applied Economics, Taylor & Francis Journals, vol. 33(2), pages 163-175.
    6. Kodde, David A & Palm, Franz C, 1986. "Wald Criteria for Jointly Testing Equality and Inequality Restriction s," Econometrica, Econometric Society, vol. 54(5), pages 1243-1248, September.
    7. Battese, G E & Coelli, T J, 1995. "A Model for Technical Inefficiency Effects in a Stochastic Frontier Production Function for Panel Data," Empirical Economics, Springer, vol. 20(2), pages 325-332.
    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. Rita Bastião & Nuno de Sousa Pereira, 2020. "Performance in the Delivery of Primary Health Care Services: A Longitudinal Analysis," CEF.UP Working Papers 2002, Universidade do Porto, Faculdade de Economia do Porto.
    2. William Griffiths & Xiaohui Zhang & Xueyan Zhao, 2010. "A Stochastic Frontier Model for Discrete Ordinal Outcomes: A Health Production Function," Department of Economics - Working Papers Series 1092, The University of Melbourne.
    3. Dino Rizzi & Michele Zanette, 2021. "Potential efficiency gains and expenditure savings in the Italian Regional Healthcare Systems," Politica economica, Società editrice il Mulino, issue 2, pages 187-214.
    4. Luis Murillo-Zamorano & Carmelo Petraglia, 2011. "Technical efficiency in primary health care: does quality matter?," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 12(2), pages 115-125, April.
    5. Thanassoulis, Emmanuel & Silva Portela, Maria C.A. & Graveney, Mike, 2014. "Using DEA to estimate potential savings at GP units at medical specialty level," Socio-Economic Planning Sciences, Elsevier, vol. 48(1), pages 38-48.
    6. Gorgemans, Sophie & Urbina-Pérez, Olga, 2022. "New legal forms in health services: Evaluation of a Spanish public policy," Health Policy, Elsevier, vol. 126(8), pages 802-807.
    7. Rafael Mu-oz de Bustillo & José-Ignacio Antón, 2013. "Those were the days, my friend: The public sector and the economic crisis in Spain," Chapters, in: Daniel Vaughan-Whitehead (ed.), Public Sector Shock, chapter 13, pages 511-542, Edward Elgar Publishing.
    8. Stefan Felder & Harald Tauchmann, 2013. "Federal state differentials in the efficiency of health production in Germany: an artifact of spatial dependence?," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(1), pages 21-39, February.
    9. William Griffiths & Xiaohui Zhang & Xueyan Zhao, 2014. "Estimation and efficiency measurement in stochastic production frontiers with ordinal outcomes," Journal of Productivity Analysis, Springer, vol. 42(1), pages 67-84, August.
    10. Thanassoulis, Emmanuel & Silva Portela, Maria C.A. & Graveney, Mike, 2012. "Estimating the scope for savings in referrals and drug prescription costs in the general Practice units of a UK primary care trust," European Journal of Operational Research, Elsevier, vol. 221(2), pages 432-444.
    11. Sørensen, Torben H. & Olsen, Kim R. & Gyrd-Hansen, Dorte, 2009. "Differences in general practice initiated expenditures across Danish local health authorities--A multilevel analysis," Health Policy, Elsevier, vol. 92(1), pages 35-42, September.
    12. Mònica Solanes-Cabús & Eugeni Paredes & Esther Limón & Josep Basora & Iris Alarcón & Irene Veganzones & Laura Conangla & Núria Casado & Yolanda Ortega & Jordi Mestres & Jordi Acezat & Joan Deniel & Jo, 2023. "Primary and Community Care Transformation in Post-COVID Era: Nationwide General Practitioner Survey," IJERPH, MDPI, vol. 20(2), pages 1-12, January.
    13. World Bank, 2009. "Serbia - Baseline Survey on Cost and Efficiency in Primary Health Care Centers Before Provider Payment Reforms," World Bank Publications - Reports 3036, The World Bank Group.
    14. Pedro Barros & Sara Machado, 2010. "Money for nothing?," Health Care Management Science, Springer, vol. 13(3), pages 234-255, September.

    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. Giannis Karagiannis & Vangelis Tzouvelekas, 1999. "Measuring Technical Efficiency with Panel Data: Results from Competing Models," Working Papers 9914, University of Crete, Department of Economics.
    2. Peter Dawson & Stephen Dobson & Bill Gerrard, 2000. "Stochastic Frontiers and the Temporal Structure of Managerial Efficiency in English Soccer," Journal of Sports Economics, , vol. 1(4), pages 341-362, November.
    3. Puig-Junoy, Jaume & Argiles, Josep M., 2004. "The influence of management accounting use on farm inefficiency," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 5(2), pages 1-20, August.
    4. Karagiannis, Giannis & Tzouvelekas, Vangelis, 2009. "Parametric Measurement of Time-Varying Technical Inefficiency: Results from Competing Models," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 10(1), pages 1-30.
    5. Goyal, S.K. & Suhag, K.S. & Pandey, U.K., 2006. "An Estimation of Technical Efficiency of Paddy Farmers in Haryana State of India," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 61(1), pages 1-15.
    6. Dairo Estrada & Poldy Osorio, 2004. "Effects of Financial Capital on Colombian Banking Efficiency," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 22(47), pages 162-201, December.
    7. Manlagnit, Maria Chelo V., 2015. "Basel regulations and banks’ efficiency: The case of the Philippines," Journal of Asian Economics, Elsevier, vol. 39(C), pages 72-85.
    8. García-Suárez, Federico & Pérez-Quesada, Gabriela & Molina, Carlos, 2022. "Rangeland cattle production in Uruguay: Single-output versus multi-output efficiency measures," Economia Agraria y Recursos Naturales, Spanish Association of Agricultural Economists, vol. 22(01), June.
    9. Luis Murillo-Zamorano & Carmelo Petraglia, 2011. "Technical efficiency in primary health care: does quality matter?," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 12(2), pages 115-125, April.
    10. Massimiliano Piacenza & Gilberto Turati, 2014. "Does Fiscal Discipline Towards Subnational Governments Affect Citizens' Well‐Being? Evidence On Health," Health Economics, John Wiley & Sons, Ltd., vol. 23(2), pages 199-224, February.
    11. Wilson, Paul & Hadley, David & Asby, Carol, 2001. "The influence of management characteristics on the technical efficiency of wheat farmers in eastern England," Agricultural Economics, Blackwell, vol. 24(3), pages 329-338, March.
    12. Rezitis, Anthony N., 2008. "Efficiency and productivity effects of bank mergers: Evidence from the Greek banking industry," Economic Modelling, Elsevier, vol. 25(2), pages 236-254, March.
    13. Hussain, Muhammad Sajid & Coelli, Tim J. & Simmons, Phil, 1999. "An Analysis of the Technical Efficiency of Cotton Farmers in the Punjab province in Pakistan," 1999 Conference (43th), January 20-22, 1999, Christchurch, New Zealand 123815, Australian Agricultural and Resource Economics Society.
    14. Duygun, Meryem & Sena, Vania & Shaban, Mohamed, 2014. "Trademarking status and economic efficiency among commercial banks: Some evidence for the UK," Journal of Banking & Finance, Elsevier, vol. 49(C), pages 506-514.
    15. Campbell, H. F. & Hand, A. J., 1998. "Joint ventures and technology transfer: the Solomon Islands pole-and-line fishery," Journal of Development Economics, Elsevier, vol. 57(2), pages 421-442.
    16. Catherine Ris & Othman Joumady, 2005. "Diffusion du capital humain et efficience salariale. Une application sur données appariées employé-employeur," Économie et Prévision, Programme National Persée, vol. 169(3), pages 127-137.
    17. Squires, Dale & Grafton, R. Quentin & Alam, Mohammed Ferdous & Omar, Ishak Haji, 2003. "Technical efficiency in the Malaysian gill net artisanal fishery," Environment and Development Economics, Cambridge University Press, vol. 8(3), pages 481-504, July.
    18. Asante, Bright Owusu & Villano, Renato A. & Battese, George E., 2014. "The effect of the adoption of yam minisett technology on the technical efficiency of yam farmers in the forest-savanna transition zone of Ghana," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, vol. 9(2), pages 1-16, April.
    19. Giannis Karagiannis & Vangelis Tzouvelekas, 2007. "A flexible time-varying specification of the technical inefficiency effects model," Empirical Economics, Springer, vol. 33(3), pages 531-540, November.
    20. Villano, Renato A. & Fleming, Euan M., 2004. "Analysis of Technical Efficiency in a Rainfed Lowland Rice Environment in Central Luzon Philippines Using a Stochastic Frontier Production Function with a Heteroskedastic Error Structure," Working Papers 12906, University of New England, School of Economics.

    More about this item

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • 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:wly:hlthec:v:13:y:2004:i:12:p:1149-1165. 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: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/5749 .

    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.