Using Value Efficiency Analysis (VEA) to Measure Productivity Efficiency in Primary Health Care

Eduardo González Fidalgo and Vicente García

No 2006/04, Efficiency Series Papers from University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG)

Abstract: Measuring productive efficiency in health organizations requires using flexible methods like Data Envelopment Analysis (DEA) capable to account for the enormous complexity of health care activities. However, the empirical application of DEA is subject to serious limitations. A recurrent problem of DEA is its scant discriminating power when the number of dimensions is large and the sample is not. This paper explores the ability of Value Efficiency Analysis (VEA) to increase the discriminating power of DEA. The VEA model uses qualitative information to constraint the range of shadow prices allowed in the programs. Applying VEA to a sample of 61 health care centres in Asturias (Spain) we certified a notable improvement in the discriminating power of DEA. The number of efficient centres decreases from 19 to 13. The results also reveal an important scale problem in some centres. We also find some relationships between managerial efficiency and some contextual variables.

Keywords: Data envelopment analysis; health economics, primary health services, Shadow prices, value efficiency analysis (search for similar items in EconPapers)
Date: 2006
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