Skip to main content
Log in

A low quality–high cost–low satisfaction trap in public health care: a model and an efficiency-quality-welfare improving stochastic resolution

  • Published:
Quality & Quantity Aims and scope Submit manuscript

Abstract

This paper develops an applied stochastic model of public health care and shows that the public health care sector in Turkey is plagued by a low quality–high cost–low satisfaction trap which has been persistent over time. The values in question are shown to be stochastically stable. We formulate an efficiency-quality-welfare improving stochastic policy rule, which helps the sector to reach a selected target and which stabilizes quality, cost and welfare around that target.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

References

  • Babakus E., Boller W.G.: An empirical assessment of the SERVQUAL scale. J. Bus. Res. 24, 253–268 (1992)

    Article  Google Scholar 

  • Boulding W., Kalra A., Staelin R., Zeithaml V.A.: A dynamic process model of service quality: from expectations to behavioral intentions. J. Mark. Res. 30(1), 7–27 (1993)

    Article  Google Scholar 

  • Caha H.: Service quality in private hospitals in Turkey. J. Econ. Soc. Res. 9(1), 55–69 (2007)

    Google Scholar 

  • Carman J.M.: Consumer perceptions of service quality: an assessment of the SERVQUAL dimensions. J. Retail. 66, 33–55 (1990)

    Google Scholar 

  • Costa J., Garcia J.: Demand for private health insurance: how important is the quality gap. Health Econ. 12(7), 587–599 (2003)

    Article  Google Scholar 

  • Cronin J.J., Taylor S.A.: Measuring service quality: a reexamination and extension. J. Mark. 56, 56–68 (1992)

    Article  Google Scholar 

  • Dasu S., Rao J.: A dynamic process model of dissatisfaction for unfavorable, non-routine service encounters. Prod. Oper. Manag. 8(3), 282–300 (1999)

    Article  Google Scholar 

  • Kara A.: Dynamic Modeling Exercises. Fatih University, Mimeo (2000)

    Google Scholar 

  • Kara A.: A concept of optimal quality and an application. Total Qual. Manag. Bus. Excell. 16(2), 243–255 (2005)

    Article  Google Scholar 

  • Kara A.: Stochastic Modeling Exercises. Fatih University, Mimeo (2006)

    Google Scholar 

  • Kara, A.: Discrete stochastic dynamics of income inequality in education: an applied stochastic model and a case study. Discr. Dyn. Nat. Soc. 1–15 (2007a)

  • Kara, A.: Stochastic equilibria in the public health care industry: a low quality trap and a resolution. In: European Applied Business Research Conference, Venice/Padova, Italy, June 2007, EABR conference—proceedings (2007b)

  • Kara A., Kurtulmuş N.: Intertemporal equilibria in the public banking sector: the case of Turkey. J. Econ. Soc. Res. 6(1), 19–32 (2004)

    Google Scholar 

  • Kara A., Osman M.A.: Dynamic equilibria in the US banking sector: a model and a case study. J. Econ. Soc. Res. 8(2), 43–52 (2006)

    Google Scholar 

  • Kara A., Tarım M., Tatoğlu E.: The economic, social and environmental determinants of tourism revenue in Turkey: some policy implications. J. Econ. Soc. Res. 5(2), 61–72 (2003a)

    Google Scholar 

  • Kara A., Tarım M., Zaim S.: A low performance-low quality trap in the nonprofit healthcare sector in Turkey and a solution. Total Qual. Manag. Bus. Excell. 14(10), 1131–1141 (2003b)

    Article  Google Scholar 

  • Kayis B., Kim H., Shin T.H.: A comparative analysis of cultural, conceptual and practical constraints on quality management implementations-findings from Australian and Korean banking industries. Total Qual. Manag. Bus. Excell. 14(7), 765–777 (2003)

    Article  Google Scholar 

  • Koerner M.M.: The conceptual domain of service quality for inpatient nursing services. J. Bus. Res. 48(3), 267–283 (2000)

    Article  Google Scholar 

  • Kopalle P.K., Lehmann D.R.: Strategic management of expectations: the role of disconfirmation sensitivity and perfectionism. J. Mark. Res. 38(3), 386–394 (2001)

    Article  Google Scholar 

  • Lee H., Delene L.M., Bunda M.A., Kim C.: Methods of measuring healthcare service quality. J. Bus. Res. 48(3), 233–246 (2000)

    Article  Google Scholar 

  • Li X.L., Collier A.D.: The role of technology and quality on hospital financial performance: an exploratory analysis. Int. J. Serv. Ind. Manag. 11(3), 202–224 (2000)

    Article  Google Scholar 

  • Oliver R.L., Swan J.E.: Consumer perceptions of interpersonal equity and satisfaction in transactions: a field survey approach. J. Mark. 53(2), 21–35 (1989)

    Article  Google Scholar 

  • Parasuraman A., Zeithaml V.A., Berry L.L.: A conceptual model of service quality and its implications for future research. J. Mark. 49, 41–50 (1985)

    Article  Google Scholar 

  • Parasuraman A., Zeithaml V.A., Berry L.L.: SERVQUAL: a multiple item scale for measuring customer perceptions of service quality. J. Retail. 64, 12–40 (1988)

    Google Scholar 

  • Parasuraman A., Zeithaml V.A., Berry L.L.: Refinement and reassessment of the SERVQUAL scale. J. Retail. 67, 420–450 (1991)

    Google Scholar 

  • Rodriguez M., Stoyanova A.: Changes in the demand for private medical insurance following a shift in tax incentives. Health Econ. 17(2), 185–202 (2008)

    Article  Google Scholar 

  • Rust R.T., Zahorik A.J.: Customer satisfaction, customer retention, and market share. J. Retail. 69(2), 193–215 (1993)

    Article  Google Scholar 

  • Rust R.T., Danaher P.J., Varki S.: Using service quality data for competitive marketing decisions. Int. J. Serv. Ind. Manag. 11(5), 438–469 (2000)

    Article  Google Scholar 

  • Sen A.: Why health equity. Health Econ. 11(8), 659–666 (2002)

    Article  Google Scholar 

  • Sendi P., Gafni A., Birch S.: Opportunity costs and uncertainty in the economic evaluation of healthcare interventions. Health Econ. 11(1), 23–31 (2002)

    Article  Google Scholar 

  • Stepanovich P.L.: Using system dynamics to illustrate Deming’s system of profound knowledge. Total Qual. Manag. Bus. Excell. 15(3), 379–389 (2004)

    Article  Google Scholar 

  • Teas R.K.: Expectations as a comparison standard in measuring service quality: an assessment of a reassessment. J. Mark. 58, 132–139 (1994)

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Ahmet Kara.

Additional information

An earlier draft of the paper was presented at the European Applied Business Research Conference, Venice/Padova, Italy, June 2007. The draft in question, (Kara 2007b), was narrower in scope and did not include the analysis of the issues associated with costs and welfare.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Kara, A. A low quality–high cost–low satisfaction trap in public health care: a model and an efficiency-quality-welfare improving stochastic resolution. Qual Quant 47, 2081–2093 (2013). https://doi.org/10.1007/s11135-011-9643-6

Download citation

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s11135-011-9643-6

Keywords

Navigation