Efficiency of hospitals under the new management models: Application Data Envelopment Analysis methodology

Abstract

In the last decades we have witnessed major reforms in public sectors of developed countries, following the implementation of the New Public Management, in the United Kingdom. These reforms aimed at increasing competition, orientation to the end consumer and rational use of public resources.

In Portugal, the reforms we have witnessed in the past years in the public service in general and the health setor in particular, fall into this new management model. Proposals for changes in the management and organization of portuguese health facilities reached greater emphasis through the corporatization process that began in late 2002.

Thus, the hospitals have adopted private management models, in the aim of cost savings, increase efficiency, focus on performance and user satisfaction

This study aims to analyze the efficiency of a sample of 16 health facilities, through the period of 2003-2011 in order to evaluate if the private management rules are delivering the intended effect, ie, if the hospital efficiency has positive evolution over time.

It used the technique Data Envelopment Analysis, which builds a efficiency border by calculating optimal weights between inputs and outputs. The main conclusions of this study point to a greater effort in rationalizing resources in the last two years of this study (2010 and 2011), confirming the fact that the cost reduction is more evident in this period. The year 2004 is the one with best results of average efficiency. It also highlights the existence of three fully effective health units throughout the period analyzed: “hospital of Santa Maria Maior”, “centro hospitalar Tâmega e Sousa” and “IPO de Coimbra”.