Background: Case mix adjustment is a prerequisite for valid measurement of healthcare performance and socioeconomic status (SES) is important to account for. Lack of information on individual-level SES has led to investigations into using a proxy for SES based on patient area of residence. The objective of this study was to use neighbourhood SES for case mix adjustment of performance indicators in total hip replacement (THR) in Sweden, and to compare with use of individual SES. Methods: Data from patient administrative systems and the Swedish Hip Arthroplasty Register were extracted for all patients undergoing THR in four Swedish regions. For each subject, individual data and neighbourhood data on country of birth, educational level, and income were provided by Statistics Sweden. Three variables were selected for analysis of performance; EQ-5D, hip pain and length of stay (LoS). In addition to socioeconomic information, several important clinical characteristics were used as case mix factors. Regression analysis was used to study each variable's impact on the three outcome variables and model fit was evaluated using mean squared error. Results: A total of 27,121 patients operated between 2010 and 2016 were included in the study. Both educational level and income were higher when based on neighbourhood information than individual information, while proportion born in Sweden was similar. Higher SES was generally found to be associated with better outcomes and lower LoS, albeit with certain differences between the different measures of SES. The predictive ability of the models was increased when adding information on SES to the clinical characteristics. The increase in predictive ability was higher for individual SES compared to neighbourhood SES. When analysing performance for the two providers with most diverging case mix in terms of SES, the inclusion of SES altered the relative performance using individual as well as neighbourhood SES.