Hospital efficiency: directed internship: Deloitte & NOVA SBE

Abstract

In a context of economic recession, where resource scarcity follows every manager, efficiency is the only way out. Health Care is no exception. Continuous budgetary cuts from central authorities led to increasing pressures in hospital managers to achieve efficient results. In light of being able to quantify efficiency, this work project has the aim of identifying the best of two frontier based analysis (Stochastic Frontier Analysis and Data Envelopment Analysis) by performing efficiency estimations for a single year using variables from the Portuguese reality, allowing the identification of inefficiency sources. Efficiency scores will be obtained to compare hospitals for efficiency ranks and several efficiency-seeking suggestions will be stated in the end. The scores obtained from the estimations show that some hospitals still have a rough path to endure if they are to achieve economic efficiency. From the analysis we can see that efficient hospitals vary for each model. (8 in SFA [hospitals with a score higher than 0.95] and 17 in DEA). Estimation outputs suggest that changes in hospital size or services provided should occur in order to achieve higher efficiency, which is in light with the presently taken health policies.