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Presentation

Session: Posters
Room: TBA
Time: Fri 13:00-14:30

Presenter: Mercedes Pereira (Regional Government of Galicia. Health Department)

Abstract

Introduction

Within the Spanish National Health System, health care related issues in the Region of Galicia are managed by the Regional Government. The 10 main hospitals (excluded those with less than 50 beds) cover the specialized healthcare attention. Each hospital has an independent managing board that administers the budget assigned by the Galician Government. For each hospital, the annual budget is based on the one of the preceding year, and they are continuously growing. In the Galician Health care system, and in the Spanish one as a whole, the costs are not usually used as a managing tool to achieve technical and allocative efficiency. In this study a cost function was obtained that will be useful for both guiding hospital management and giving information on how to undertake the health care expenditure reductions imposed by the current economic environment.

Materials and methods

The Anuual Hospital Reports (2002 – 2008) were used to calculate the Adjusted Hospital Production Units (AHPUs), a hospital production index commonly used in Spain that takes into account patient transfers between hospitals. Multidimensional data analysis and hierarchical classification techniques applied to the Annual Hospital Budget chapters and AHPUs were used to classify 10 hospitals in 3 clusters. Within each cluster the evolution of health expenditure was analysed, and Berndt and Christensen translog cost functions were obtained by means of multiple regression analysis. The results were validated using Kolmogorov-Smirnoff test and Durbin-Watson index. Data analyses were carried out using Minitab12 and SPSS

Results

Total regional expenditure, cluster expenditures and hospital expenditures were properly explained (p < 0.05) by the independent variables AHPUs, chapter I (staff costs), chapter II (other running costs) and chapter VI (fixed assets). The models used were ln (Total Budget) = constant + β ln (AHPU) + β ln (chapter I) + β ln (chapter II+VI) + β ln (chapter I) x ln (chapter II + VI). The tests carried out proved that the models fit the data well. Labour and capital were the main factors, accounting for more than 90% of the total budgets. The models allowed to analyze the evolution of the cost components throughout the period studied. They showed a lack of investments in high technology, which is concentrated in the biggest hospitals. There was an increase in AHPU costs, especially important in small hospitals, which is connected with a decreasing efficiency. Nevertheless, since 2007 seven of the 10 hospitals studied began to reduce their AHPU costs.

Key Terms

cost function, translog, efficiency

Authors:

Mercedes Pereira (Regional Government of Galicia. Health Department) , Concepción Sieiro (Galician Health Service. Primary Care Agency of Lugo) , José Luis Jiménez (Galician Health Service. Health Department) , Enrique Rouco (Galician Health Service. Hospital da Costa) and Enrique Arbones (University of Santiago de Compostela. Agricultural Engineering)

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