Technical Efficiency in Nursing Homes

Technical and scale efficiency in public and private Irish nursing homes – a bootstrap DEA approach

“…Input-oriented TE has also been more widely used, relative to the other efficiency measures, in empirical studies on the nursing home sector (e.g. Nyman and Bricker 1989;Nyman et al 1990;Fizel and Nunnikhoven 1992;Chattopadhyay and Heffley 1994;Kooreman 1994;Ozcan et al 1998;Bjorkgren et al 2001;Laine et al 2005;Wang and Chou 2005;Borge and Haraldsvik 2009;Garavaglia et al 2011;Chang and Cheng 2013;DeLellis and Ozcan 2013). 4 Table A1 presents an overview of the studies which applied different techniques for estimating efficiency in the nursing home sector in various countries.…”

“…DEA is the dominant approach to efficiency measurement in healthcare (Hollingsworth 2003(Hollingsworth , 2008. In relation to nursing homes, DEA was used to estimate technical efficiencies in the USA by Nyman and Bricker (1989), Nyman et al (1990), Fizel and Nunnikhoven (1992), Kleinsorge and Karney (1992), Chattopadhyay and Heffley (1994), Chattopadhyay and Ray (1996), Ozcan et al (1998), andDeLellis andOzcan (2013); and by Kooreman (1994) for the Netherlands; Bjorkgren et al (2001), and Laine et al (2005) for Finland; Borge and Haraldsvik (2009) for Norway; Garavaglia et al (2011) for Italy;and Wang and Chou (2005) and Chang and Cheng (2013) for Taiwan.…”

“…However, Wilson (2007, 2011) assert that whatever the second-stage regression technique employed, conventional inference methods fail to give valid inference due to the fact that in the secondstage, true efficiency remains unobserved and must be replaced with DEA estimates of efficiency, and these are serially correlated by construction, and are also biased. 5 Previous two-stage DEA nursing home efficiency studies include Nyman et al (1990), Fizel and Nunnikhoven (1992), Kooreman (1994), Ozcan et al (1998), Wang and Chou (2005), and Garavaglia et al (2011). In these models, the determining factors posited are drawn from the following set of variables: ownership, case-mix (e.g.…”

“…The former being measured by the number of full-time nurses, while the latter is measured by the number of full-time health care attendants. 7 Among the efficiency studies which have used medical staff (full-time equivalents) as an input in their DEA models are Nyman et al (1990), Ozcan et al (1998), Bjorkgren et al (2001), Laine et al (2005), and Delellis and Ozcan (2013). Nurses have a formal qualification in clinical care delivery, sometimes to postgraduate level.…”

“…In relation to nursing homes in the USA, Nyman and Bricker (1989), Nyman et al (1990), Fizel and Nunnikhoven (1992), Chattopadhyay and Heffley (1994), and Ozcan et al (1998) find for-profit homes to be more technically efficient than non-profit units. From Nyman et al (1990), non-profit nursing homes use about 6% more inputs per patient than for-profit facilities, and in Fizel and Nunnikhoven (1992), for-profit nursing homes have higher mean levels of efficiency and a more efficient production frontier than non-profit homes. Additionally, Ozcan et al (1998: 221) observe that "consistent with much of the previous literature, this study found for-profit facilities to be more efficient than nonprofits, when allowed to face the same frontier.…”