Assessing performance of Taiwan hospitals using data envelopment analysis: In view of ownership

Abstract

With rapid economic development in Taiwan, people have greater awareness of health care and are paying more attention to it. From the perspective of hospital management, the scale of hospitals and efficiency improvement are of concern to hospital managers. However, the extent of efficiency will differ between public and private hospitals due to their different ownership and goals. The study aims to evaluate the efficiency of public and private hospitals and to investigate the influence of ownership on efficiency of hospitals. The differences between hospitals can be understood by analyzing the features of the organization of hospitals and their geographic environment. In this way, hospitals with relatively low efficiency will be able to make improvements based on concrete evidence. By means of the two-stage method, the efficiency scores of 182 hospitals in Taiwan are compared. In the first stage, the data envelopment analysis is applied to obtain the efficiency scores of hospitals. The results show that private hospitals are more efficient than public hospitals. In the second stage, Tobit regression is used to investigate the factors influencing efficiency obtained by the data envelopment analysis. The results indicate that there are differences between ownership in market competition and the average length of stay.