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Managerial performance and cost efficiency of Japanese local public hospitals: A latent class stochastic frontier model

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  • Galina Besstremyannaya

Abstract

The paper explores the link between managerial performance and cost efficiency of 617 Japanese general local public hospitals in 1999–2007. Treating managerial performance as unobservable heterogeneity, the paper employs a panel data stochastic cost frontier model with latent classes. Financial parameters associated with better managerial performance are found to be positively significant in explaining the probability of belonging to the more efficient latent class. The analysis of latent class membership was consistent with the conjecture that unobservable technological heterogeneity reflected in the existence of the latent classes is related to managerial performance. The findings may support the cause for raising efficiency of Japanese local public hospitals by enhancing the quality of management. Copyright © 2011 John Wiley & Sons, Ltd.

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  • Galina Besstremyannaya, 2011. "Managerial performance and cost efficiency of Japanese local public hospitals: A latent class stochastic frontier model," Health Economics, John Wiley & Sons, Ltd., vol. 20(S1), pages 19-34, September.
    • Handle: RePEc:wly:hlthec:v:20:y:2011:i:s1:p:19-34
    DOI: 10.1002/hec.1769
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    5. Matthias Eckardt & Christian Brettschneider & Hendrik van den Bussche & Hans‐Helmut König & MultiCare Study Group, 2017. "Analysis of Health Care Costs in Elderly Patients with Multiple Chronic Conditions Using a Finite Mixture of Generalized Linear Models," Health Economics, John Wiley & Sons, Ltd., vol. 26(5), pages 582-599, May.
    6. Roberto Colombi & Gianmaria Martini & Giorgio Vittadini, 2017. "Determinants of transient and persistent hospital efficiency: The case of Italy," Health Economics, John Wiley & Sons, Ltd., vol. 26(S2), pages 5-22, September.
    7. Liu, Junqing & Fukushige, Mototsugu, 2020. "Efficiency and pricing of water supply and sewerage services in Japan," Utilities Policy, Elsevier, vol. 62(C).
    8. Germán M. Izón & Chelsea A. Pardini, 2017. "Cost inefficiency under financial strain: a stochastic frontier analysis of hospitals in Washington State through the Great Recession," Health Care Management Science, Springer, vol. 20(2), pages 232-245, June.
    9. Galina Besstremyannaya, 2015. "Heterogeneous effect of residency matching and prospective payment on labor returns and hospital scale economies," Discussion Papers 15-001, Stanford Institute for Economic Policy Research.
    10. Besstremyannaya Galina & Golovan Sergei, 2022. "Disentangling the impact of mean reversion in estimating policy response with dynamic panels," Dependence Modeling, De Gruyter, vol. 10(1), pages 58-86, January.
    11. Lukas Kwietniewski & Jonas Schreyögg, 2018. "Efficiency of physician specialist groups," Health Care Management Science, Springer, vol. 21(3), pages 409-425, September.
    12. Galina Besstremyannaya, 2013. "Heterogeneous hospital response to a per diem prospective payment system," Working Papers w0193, New Economic School (NES).
    13. Galina Besstremyannaya & Dmitry Shapiro, 2012. "Heterogeneous effect of prospective payment system on hospital’s volume and quality," Working Papers w0181, Center for Economic and Financial Research (CEFIR).
    14. Mareike Heimeshoff & Jonas Schreyögg & Lukas Kwietniewski, 2014. "Cost and technical efficiency of physician practices: a stochastic frontier approach using panel data," Health Care Management Science, Springer, vol. 17(2), pages 150-161, June.
    15. Getu Hailu & B. James Deaton, 2016. "Agglomeration Effects in Ontario’s Dairy Farming," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 98(4), pages 1055-1073.
    16. Yongqiao Wang & He Ni & Stan Uryasev, 2023. "Buffered-ranking intervals for virtual profit efficiency analysis," 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. 31(4), pages 1149-1181, December.
    17. Galina Besstremyannaya, 2016. "Differential Effects of Declining Rates in a Per Diem Payment System," Health Economics, John Wiley & Sons, Ltd., vol. 25(12), pages 1599-1618, December.
    18. Lukas Kwietniewski & Jonas Schreyögg, 2018. "Profit efficiency of physician practices: a stochastic frontier approach using panel data," Health Care Management Science, Springer, vol. 21(1), pages 76-86, March.
    19. Xing, Zhang & Oyama, Tatsuo, 2016. "Measuring the impact of Japanese local public hospital reform on national medical expenditure via panel data regression," Technological Forecasting and Social Change, Elsevier, vol. 113(PB), pages 460-467.
    20. Galina Besstremyannaya, 2013. "The impact of Japanese hospital financing reform on hospital efficiency: A difference-in-difference approach," The Japanese Economic Review, Japanese Economic Association, vol. 64(3), pages 337-362, September.
    21. Galina Besstremyannaya, 2015. "The adverse effects of incentives regulation in health care: a comparative analysis with the U.S. and Japanese hospital data," Working Papers w0218, Center for Economic and Financial Research (CEFIR).
    22. Galina Besstremyannaya, 2015. "The adverse effects of incentives regulation in health care: a comparative analysis with the U.S. and Japanese hospital data," Working Papers w0218, New Economic School (NES).
    23. Galina Besstremyannaya, 2014. "The efficiency of labor matching and remuneration reforms: a panel data quantile regression approach with endogenous treatment variables," Working Papers w0206, New Economic School (NES).

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