Technical efficiency of Critical Access Hospitals: an application of the two-stage approach with double bootstrap

Iustin Nedelea () and James Fannin ()

Health Care Management Science, 2013, vol. 16, issue 1, 27-36

Abstract: The Critical Access Hospital (CAH) Program has offered Medicare cost-based reimbursement to small hospitals that meet certain eligibility criteria to improve their financial viability and quality of care. However, cost-based reimbursement has been associated with inefficiency in hospital operations. This study uses a two-stage approach and bootstrap procedures to examine the effects of environmental variables on the technical efficiency of CAHs. The two-stage approach with quality controls significantly improved statistical efficiency of parameter estimates in the second stage bootstrapped truncated regression relative to a similar model without quality controls. Overall, our results suggest that enhanced Medicare reimbursement may not have had detrimental effects on the technical efficiency of CAHs. Copyright Springer Science+Business Media, LLC 2013

Keywords: Critical Access Hospitals; Two-stage approach; Technical efficiency; Bootstrap; 62G05; 62G07; 62G09; 62G10; 62G15; 62J99 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (9)

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DOI: 10.1007/s10729-012-9209-8

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