Analysing hospital productivity changes using non-parametric approaches

Abstract.

The Austrian hospital financing is currently changing, thereby altering the underlying incentive system for hospitals. The purpose of the present hospital financing system is to reduce the dynamics in hospital expenditures by enhancing hospitals' productive performance. This paper looks at the time period 1997 to 1999 and analyses whether the new financing system is already succeeding in enhancing hospital productivity using the approach proposed by Färe, Grosskopf, Norris and Zhang (FGNZ, 1994) to calculate and decompose productivity changes in its components. To analyse the stability of the empirical results based on the FGNZ approach we apply another two approaches, the Ray and Desli (RD, 1997) and the Grifell-Tatjé and Lovell (GL, 1999) approaches.