Abstract
The English healthcare sector underwent extensive system reform over the period from 2010 to 2015, aimed principally at improving technical efficiency. This paper examines the effect of the reforms on foundation trusts in England with particular emphasis on technical efficiency. By employing data envelopment analysis (DEA) and a second-stage regression, we found evidence of an overall improvement in efficiency, notwithstanding some fluctuations. Specifically, we found that bed utilization had positive and statistically significant association with the efficiency of acute foundation trusts; suggesting that better management of patient flows and bed utilization might be expected to improve hospital efficiency. We also found evidence to suggest that efficiency might also be improved through better management of staff numbers, optimizing liquidity, and better utilization of assets such as buildings and information technology.
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Source: Authors’ calculation using Public Expenditure Statistical Analyses 2010, 2013, and 2017 (HM Treasury 2017)
Source: Adapted from Robertson et al. (2017)
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Notes
In order to have adequate numbers of degrees of freedom (adequate discriminatory power for the DEA model), the “n” (number of DMUs) should exceed the number of inputs (m) and outputs (s) by several times. More specifically, a suggested rule of thumb formula is that that “n” should be greater than max {m*s, 3* (m + s)}.
By way of a robustness check, we did also run regressions employing Tobit random effects, and OLS (with year dummies) and found that the results were quite similar. These results are available from the corresponding author.
Mid-Staffordshire failure (dated back to late 2000s) related to unacceptable poor standards and high mortality rate at Stafford hospital which is considered to be the most notorious stigma in the NHS England history.
Patients should be treated either as an inpatient or as an outpatient within 18 weeks of the referral. In 2013 additional target set was that no-one has to wait for more than 52 weeks to be treated. In June 2015, the admitted (90%) and non-admitted (95%) metrics were terminated, the only measure left is incomplete pathway standard.
In examining expenditure characteristics of England public hospitals, Kelly et al. (2016) point out that costs accelerate when the patients’ age increase.
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Acknowledgments
The authors would like to show our gratitude to Professor Paul Rouse, University of Auckland, New Zealand, and Dr. Joseph Drew, University of Technology Sydney, Australia and the two anonymous reviewers for their dedicated assistance and constructive comments that greatly improved the quality of the manuscript.
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This study was funded by the advanced research programme (Kodo Kenkyuu) sponsored by Tokyo Metropolitan Government.
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Thai, K.Q., Noguchi, M. Evaluating efficiency of English acute foundation trusts under system reform: a two-stage DEA approach. Health Serv Outcomes Res Method 19, 215–240 (2019). https://doi.org/10.1007/s10742-019-00203-6
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DOI: https://doi.org/10.1007/s10742-019-00203-6