14 - A Review of US Stochastic Frontier Studies of Hospital Efficiency Published After 2008

Summary

This chapter focuses on stochastic frontier analysis studies of US hospitals, with an emphasis on 24 articles published since a review article by Rosko and Mutter in 2008. Stochastic frontier analysis (SFA) is the leading parametric technique used to analyze efficiency and productivity of hospitals. The chapter is organized around the five major ways in which hospital SFA studies have typically varied. The chapter also provides a summary of other study aspects such as sample size, geographic scope of study, whether efficiency was the dependent or independent variable, and important findings. While the older studies focused mainly on the correlates of hospital efficiency, the more recent studies had broader areas of inquiry including the association of efficiency with electronic medical record adoption, financial performance, patient satisfaction, patient care quality gaps, and wellness scores. The more recent studies also focused on consistency of estimates, policy analysis, and the use of SFA estimates of efficiency for benchmarking.