Intermediate input sharing in the hospital service industry

This paper addresses two related questions that help to explain geographic variation in access to medical services. The first question examines the existence of agglomeration economies in the hospital service industry. The second considers whether the sharing of intermediate inputs contributes to spillovers from spatial concentration of hospital services. These questions are addressed by estimating a bivariate probit model that explicitly controls for potential correlations between whether a service is provided and how the service is provided. Three key findings are obtained. First, hospitals in more concentrated areas are more likely to outsource intermediate services to specialized intermediate service suppliers. This suggests that agglomeration economies exist in the hospital service industry and are generated in part through the sharing of intermediate inputs. Second, the presence of nearby small hospitals increases the tendency to outsource, which is consistent with a “Chinitz” effect identified elsewhere in the literature. Third, the agglomeration effect attenuates geographically.     

A location-based comparison of health care services in four U.S. states with efficiency and equity

This paper examines the efficiency and equality in geographic accessibility provided by hospitals. We use the criteria efficiency, availability of the service, and equality. Quantitative measures are defined for all criteria, and are measured using a geographical information system. We then compare existing locations with optimal locations satisfying two objectives, one that minimizes hospital–patient distance, and another that captures as many patients as possible within a pre-specified time or distance. The results of our study indicate that the existing locations provide near-optimal geographic access to health care. Some potential for improvement is indicated.     

The impact of strategic operations management decisions on community hospital performance

Over the past decade, 10% of community hospitals have closed. In this challenging time, our study presents hospital administrators with some valuable information that can help improve community hospitals’ performance. The purpose of this paper is to develop a strategic operations management model that links long-term service choices, intermediate operations decisions, and hospital performance given the structural constraints of location, size, and medical teaching status. Data collected from 151 community hospitals are used to test the model. The research identifies strategic operations management decisions in the US community hospitals, shows their causal relationships, and identifies their effects on hospital performance. Specifically, we find that intermediate infrastructural operations decisions affect a community hospital’s cost, quality, and financial performance after the structural decisions of location and size have set the stage. Our study also reveals that community hospitals have adopted new staff and demand management decisions in response to the market needs.     

长沙市城乡社区开展基本公共卫生服务的问题与思考

从2009年深化医药卫生体制改革以来,长沙市城乡社区卫生服务机构在落实基本公共卫生服务项目的过程中,不断探索,取得了明显进展和显著成效,但也存在一些亟待解决的问题。为此,笔者深入城乡社区和乡镇卫生院进行了调研,查阅了相关资料,进行了一些思考。     

The Use of Data Envelopment Analysis with Probabilistic Assurance Regions for Measuring Hospital Efficiency

This paper uses Data Envelopment Analysis (DEA) for an estimation of the cost efficiency of 70 Danish hospitals. The analysis relates to a cost function based on 483 outputs in combination with a set of probabilistic assurance regions defined by the cost distributions for each output. It is demonstrated that the probabilistic assurance region approach allows for (i) a frontier estimation in the full output space, i.e., no fixed aggregation is required, and (ii) a controlling of the variation in heterogeneity of the output clusters, in casu Diagnosis Related Groups. The likelihood of the estimated efficiency score for a given hospital can be measured based on the sensitivity of the score w.r.t. the probability levels used in the specification of confidence intervals for the probabilistic assurance regions.     

Techniques for defining geographic boundaries for health regions

Many federal and state programs require the geographic partitioning of states into regions for health services planning, monitoring, and/or administration. A common consideration for such programs is that region boundaries should be drawn so as to maximize the proportion of the state's population that receives health care services in its region of residence. Defining region boundaries thus may be viewed as a problem of partitioning a set of N small areal units (e.g. counties) into M subsets (regions) so as to minimize interactions (patient flow) among subsets. This paper describes three algorithms for region design and compares them in terms of computer-processing efficiency and solution value based on results from a number of test cases. Application of two of the algorithms, one based on the greedy heuristic and the other incorporating a max-flow/min-cut procedure, to a problem of dividing a metropolitan region into separate service areas for clusters of hospitals is also described.     

Analysis of different public policies through simulation to increase total social utility in a healthcare system

Public and private hospitals are seen to co-exist in several countries and they have different levels of service, waiting times and prices. Public hospitals, in general, are cheaper, but more crowded and offer lower quality service than private ones while private ones are underutilized because of the higher payments required for their services. These differences among hospitals affect patients’ choices in hospital selection and result in different levels of satisfaction in the community. Appropriate subsidy mechanisms can be developed to balance the capacity utilization of both sectors and to improve overall access to healthcare. The objective of this study is to develop an estimate of the magnitude of this improvement and differential effectiveness of various policies in achieving this improvement. For this purpose, we develop a simulation model that includes all the emergency departments of main public and private hospitals in a certain region of Turkey. We analyze the effects of different public policies on patients’ preferences regarding hospital choices and the results of these choices on social utility and public healthcare spending. Different capacity decisions, contracting and subsidy mechanisms are proposed and the optimal system parameters are determined under these mechanisms over this simulation model. After the validation and verification of the simulation model, several scenarios are designed and executed to increase social utility, decrease government expenses, improve patient satisfaction level and decrease waiting times. We compare the proposed scenarios based on multiple objective functions and present numerical results for different scenarios in this system.     

Exploring the potential of SMEs to build individual,organizational, and community resilience through sustainability-oriented business practices

Small- and medium-sized enterprises (SMEs) can have significant resources, capacities, and influence in their communities, suggesting they have the potential to be agents for transformative sustainability. However, SMEs will need to move beyond firm-centered sustainable business practices towards strategic approaches that encompass and contribute to resilience-building processes. Amid the unfolding COVID-19 pandemic, we explored what types of sustainable business practices of SMEs can contribute to individual, organizational, and community resilience. We identified six clusters of practice that are important in this regard. The clusters are not solely technical or “environmental” but rather illustrative of deeper sustainable values shaped by organizational structure, culture, and behavior. This paper suggests that SMEs can pursue transformative approaches to sustainability that are more environmentally, socially, and economically sustainable and better able to withstand shocks like the COVID-19 pandemic and can be significant contributors to community resilience. We conclude with a series of future research priorities critical to examine a largely unexplored nexus in the private sector, the linkages and dynamics between sustainability practice, resilience building, and broader community pathways.     

Assessing geographic coverage of the essential air service program

Essential air service (EAS) is a federally funded program that helps provide commercial air transport service from smaller, geographically remote communities in the United States. While critics of this program frequently cite the underutilization of EAS connections as being an indicator of wasteful public spending, recent studies suggest that the spatial configuration of EAS subsidized airports may also contribute to systemic inefficiencies. The purpose of this paper is to explore the prospects for reducing EAS allocations while meeting existing geographic service needs. The analysis of this public sector service is structured using classic location coverage problems to examine whether there are any system inefficiencies. This enables an objective assessment to be carried out, using spatial optimization modeling approaches. The subsequent analysis provides the basis for a number of public policy insights, including the evaluation of service redundancies, the impact of geographic proximity guidelines and the potential for expanding coverage of the EAS program.     

Effects of healthcare quality and reimbursement rate in a hospital association

Tackling the mismatch between the supply of and demand for care service is an especially important issue among many healthcare providers and regulators. To entice patient demand distribution to become more equilibrated among different regions, some countries' governments have proposed to establish a hospital association with different levels of hospitals to implement patient mobility. However, the sustainable operation and management of the hospital association have not been formally analyzed. In this paper, we develop a Salop model to analyze the strategic behavior of patient welfare and hospital utility maximizations in a hospital association comprised of three hospitals in different income regions. For the former objective, we find that the higher quality provisions may harm patient welfare, and especially there are unique quality thresholds of the hospitals such that the higher quality provisions lead to higher patient welfare only when the quality provisions exceed the thresholds. For the latter objective, we capture the optimal equilibrium quality provisions of the overall hospital association. We consider both the case when the taxation rates are regulated (TRR) and exogenous to the hospitals and the case when taxation rates are adjusted (TRA) and constrained by hospital reimbursement rates. Under the TRA case, we find that a higher reimbursement rate of the local hospital causes a higher and lower quality threshold of the hospital in the local and neighboring regions, respectively; and we also show that with the utility maximization objective, the reimbursement rate's impact depends on regulator's altruism towards patient welfare. For a relatively low altruistic behavior, a TRA could improve the quality provision but lower the number of outflowing patients in the case of a high (and low) hospital's reimbursement rate in the local (and neighboring) region. When the regulator cares more about patient welfare, the findings in the quality provision and patient mobility are just contrary. Our analytical results lead to some important policy implications for facilitating the further deployment of hospital association delivery in the hospitals' quality provision associated with patient mobility.     

The diffusion of exporting in Brazilian industrial clusters

The present research aimed at understanding the process by which firms in a cluster start to export based on systemic interactions, and the process of diffusion of exporting as a business strategy within the cluster. Diffusion was defined, following Rogers’ (1995: 5) seminal work, as ‘the process by which an innovation is communicated through certain channels over time among the members of a social system’. The research method used was industry case studies and the unit of analysis selected was the cluster. Two manufacturing industries were chosen to be investigated, and within each geographic area clusters were identified as the origin of dynamic export growth in the industry. Players in each industrial cluster, as well as other significant actors, were interviewed. Extensive secondary data research was done to study clusters’ historical development. Detailed analysis and a comparison of the experiences permitted the extraction of some general conclusions concerning the similarities and differences between the clusters in terms of the adoption and diffusion of exporting. Results showed that the diffusion of exporting in an industrial cluster is quite similar to the dissemination of technical innovation. Social ties were important to facilitate the diffusion of exporting in one of the clusters studied. Also, the role of domestically-owned flagship firms in leading the internationalization process proved to be important in only one of the clusters, while the role of external actors was fully supported in the two industries studied. Finally, a number of support institutions, private and public, interfered in different stages of the internationalization process. In both industries, the federal government had only a late and limited impact on export initiation and development.     

Physician practice style variations

This article studies the variation in physician practice style among geographic regions and across time. A physician practice profile is defined and a simple model for profile variation is developed. Ratios are calculated for the components of the profile—ambulatory visit rate, hospitalization rate and length of hospitalization—and studied in terms of adaptation to resource constraint and nonspecific style. The methods are applied to hospital use in the Census Metropolitan Areas of Canada.     

城市医院与社区卫生服务机构互动合作模式的选择——基于关系租金视角

随着我国新型两级医疗卫生服务体系的建立,构建两级医疗卫生服务体系间的良好互动体系,成为新型医疗卫生服务体系研究的焦点。本文从经济组织的关系租金视角,对城市医院与社区卫生服务机构的互动合作模式选择问题进行探索性研究。研究结论表明,建立长期关系导向的互动合作模式是最优模式,组建医院集团的互动合作模式,是一种帕累托改进结果。     

Relating focus to quality and cost in a healthcare setting

Focus in healthcare has been heralded as the next frontier in improving its efficiency and efficacy (Herzlinger 2004). Focus takes several different forms, ranging from standalone specialty centers to a hospital that places a strategic emphasis on a clinical area. We adopt this latter perspective and define focus as a disproportionate emphasis on a particular clinical area in a hospital. We use secondary data from hospitals providing cardiology care in New York State to examine the relationship between focus and performance. We develop two measures of focus. Proportional focus is defined to be the proportion of cases treated in a particular clinical specialty. Expertise focus is defined to be specific evidence that a hospital has taken action to build expertise in treating diseases in that specialty. We operationalize hospital performance along cost and quality dimensions, and we use hierarchical regression to examine the impact of focus on performance. Our results indicate that proportional focus, but not expertise focus, is associated with better cost performance. Quality performance, on the other hand, was associated only with the interaction between proportional focus and expertise focus, which means that only hospitals exhibiting higher levels of both proportional and expertise focus achieve better quality performance. These findings support the notion that not only is focus important in healthcare, but also that researchers and practitioners need to recognize that relationships are contingent on the performance and focus measures used and thus, findings may not be generalizable from one metric to another.     

The effects of environmental characteristics on the structure of hospital clusters

The population ecology view that variation in sets or clusters of organizations should be isomorphic with variation in cluster environment was used here to explain structural variation among hospital clusters. The structural characteristics studied were range of services offered within the cluster, average size of hospitals in the cluster, and cluster differentiation. In the causal model that was developed and evaluated, variation in the patient environment and variation in the supplier environment were compared. Four lagged panels of data on a national sample of fifteen hospital clusters demonstrated the relative superiority of supplier variables over patient variables. Supplier group preferences were more powerful than patient needs in determining the range of services offered by the cluster. Furthermore, increasing the range of services in the cluster had a positive, significant effect on average hospital size, whereas size apparently exerted no effect on range of cluster facilities. Cluster differentiation seems to be causally affected by range of services, average hospital size, and by the periodic closing of hospitals over time.     

Ownership structure and hospital service costs and fees: A decomposition approach

This paper analyzes hospital characteristics that are associated with higher average costs and charges for venipuncture, computed tomography procedures (computerized axial tomography [CAT] scans), and electrocardiograms (EKG). Using data from a Medicare database, our results indicate that higher wages, larger hospital sizes, and greater service quality are associated with higher procedure costs, whereas system membership is generally associated with lower procedure costs. Blinder‐type decompositions, which are the main focus of this study, suggest (a) that venipuncture costs are about 17% to 19% lower at proprietary hospitals than at nonprofit or government hospitals, (b) CAT scan costs are about 6% to 12% lower at nonprofit hospitals than at proprietary and government hospitals, and (c) that EKG costs are about 3% lower at proprietary hospitals than at nonprofit or government hospitals. Lastly, large portions of each of these differences are found to be due to both differences in mean values of the hospitals' characteristics by ownership type and differences in the mechanism by which the hospitals' characteristics are transmitted to procedure costs.     

The General NFP Hospital Model

Throughout the past 30 years, there has been a lot of controversy surrounding the proliferation of new forms of health care delivery organizations that challenge and compete with general NFP community hospitals. Traditionally, the health care system in the United States has been dominated by general NFP (NFP) voluntary hospitals. With the number of for‐profit general hospitals, physician‐owned specialty hospitals, and ambulatory surgical centers increasing, a question arises: “Why is the general NFP community hospital the dominant model?” In order to address this question, this paper reexamines the history of the hospital industry. By understanding how the “general NFP hospital” model emerged and dominated, we attempt to explain the current dominance of general NFP hospitals in the ever changing hospital industry in the United States.     

A Fraternity Of Danger

A bstract . Interviews and participation with members of rural volunteer fire departments (VFDs) in New York State, indicate that local communities in rural regions are structured around VFDs. Such "communities" involves both the fraternity of the fire house, resting on the teamwork essential to firefighting, and a wider locality, which the VFDs spatially define and symbolically integrate through a ritual of parades, fund raising efforts, and their example of community service. The working class, attached to the locality by stable residence and recruited intergenerationally into the fire service, supplies the majority of volunteers.
Neoliberal modernization threatens this recruitment pattern. Problems have developed because the "new middle class" rejects VFD participation, except as ambulance volunteers. As localities compete for outside investment through the reduced cost of their services, they have exploited volunteers to provide fire protection at less cost than that of paid departments. This commodification of the VFDs risks destroying their character as a system of moral obligation unifying a locality and is an inequitable, and unsustainable, "tax" on working class volunteers. But innovative systems of emergency and other services can be used to attract the new male and female middle class into volunteer local activities.     

Developing economic measures of hospital productivity

This study presents a methodology for measuring hospital output and estimating hospital productivity. A productivity index is developed for a sample of hospitals in New York City for which information was far more detailed than in systematic national sources, and sources of differences among hospitals in productivity are investigated. Internal consistencies in the productivity relationships are examined, and the findings are compared with cost relationships derived from the same data base. The analysis suggests that much better measures for a number of service areas and improved methods for dealing with variations in quality of care will be needed before reasonably accurate hospital-wide measures of output and productivity can be attained.     

Measuring small area variation in hospital use: site-of-care versus patient origin data.

There has been increasing attention paid to small area variation in hospital discharge rates. While there is general agreement about the importance of correcting for the migration of patients to hospitals outside their geographic area when constructing population-based hospital use rates for these small areas, there have been no studies of the sensitivity of simple correlations or multiple regression results to these adjustments. Given the paucity of patient origin data, which is needed to adjust hospital discharge rates for patient crossovers, the problems of measurement error present in the more readily available site-of-care data need to be addressed. This paper analyzes the variation in hospital discharge rates, both an unadjusted site-of-care rate and an adjusted patient origin rate, across the 68 counties in the lower peninsula of Michigan in 1980. The results indicate that both simple correlations and multiple regression results of these rates with socio-economic and health care resource characteristics of the counties are very sensitive to the specification of the discharge rate, with the analysis of the unadjusted rate potentially leading to incorrect policy recommendations. The explanatory power of the socio-economic characteristics is underestimated and that of health care resource measures most likely overestimated when the discharge rate is not adjusted for patient crossovers.