Cheap and Dirty: The Effect of Contracting Out Cleaning on Efficiency and Effectiveness

Abstract

Contracting out of public services, especially ancillary services, has been a key feature of New Public Management since the 1980s. By 2014, more than £100 billion of U.K. public services were being contracted out annually to the private sector. A number of high-profile cases have prompted a debate about the value for money that these contracts provide. Value for money comprises both the cost and the quality of the services. This article empirically tests the contestability and quality shading hypotheses of contracting out in the context of cleaning services in the English National Health Service. Additionally, a new hypothesis of coupling is presented and tested: the effect of contracting of ancillary services on patient health outcomes, using the hospital-acquired infection rate as our measure. Using data from 2010-11 to 2013-14 for 130 National Health Service trusts, the study finds that private providers are cheaper but dirtier than their in-house counterparts. Evidence for Practice • Contracting out of public services, especially auxiliary services, is a key component of New PublicManagement because of the belief that it will lower costs and possibly increase quality. • Economic theory predicts that when quality is hard to measure ex-post or hard to define ex-ante, suppliers may reduce quality to maintain their own costs, as they are the residual claimant on any profit. • We find evidence to support the quality shading hypothesis and the coupling theory. Hospitals contracting out cleaning services had lower levels of cleanliness and worse health-care outcomes as measured by hospitalacquired infections. • Public service managers must be very careful when outsourcing services-even auxiliary services; some performance indicators should reflect aspects of the quality of the core service.

Health inequalities: the hidden cost of COVID-19 in NHS hospital trusts?

“…However, many NHS trusts do not directly employ these staff groups, who are usually in the lowest pay bands and are more likely to be migrants. As a result, they often do not enjoy equality in pay or terms of employment, 20,21 and in particular many outsourcing firms do not provide sick pay for the first three days. 22 A consequence of this may be that staff with mild symptoms or who have a symptomatic household member may feel they have no option but to attend work, thereby undermining infection control efforts.…”

Is it worth outsourcing essential public health services in China?—Evidence from Beilin District of Xi'an

“…10 Elkomy et al used the infection rate to measure the quality of hospital outsourcing clean services. 39 The second is described by subjective indicators, such as Maher et al used survey data to evaluate the quality of pharmacy outsourcing. 40 Objective indicators can more accurately describe the specific quality indicators of service objects.…”

“…The first is to use objective indicators to describe, such as Bergman et al used the mortality rate to evaluate the quality of care for the elderly in Sweden 10 . Elkomy et al used the infection rate to measure the quality of hospital outsourcing clean services 39 . The second is described by subjective indicators, such as Maher et al used survey data to evaluate the quality of pharmacy outsourcing 40 .…”

Who Does It Better? Comparing Immigration Detention Facility Performance in an Intergovernmental and Intersectoral Context

“…To the best of our knowledge, this is the first‐ever large‐ N study to examine the performance of public and privately contracted ICE detention facilities—a timely topic in terms of both the policy context and its relevance to the expansion of theory. Current public administration literature lacks empirical clarity on the effect of government contracting on service quality and on whether the promise of service quality improvement grounded in contracting theory is evidenced in different contexts (Elkomy, Cookson, and Jones ). Our research addresses this question in the context of immigration detention.…”