Efficiency evaluation of public hospitals in Kuwait: An application of data envelopment analysis

Abstract

Background: Kuwait overall health expenditure, in 2019, was 5.5% from the gross-domestic product and the state is the biggest healthcare provider in secondary and tertiary hospitals. Hospital efficiency and productivity are, therefore, an important issue to analyse, specifically in terms of number of visits to outpatient clinics, the number of surgical procedures performed, bed turnover and bed occupancy. Data envelopment analysis has been used to provide insights in the understanding of this growth in other countries. Methods: Data envelopment analysis (DEA) was used to estimate technical and scale efficiency scores for seventeen public hospitals in Kuwait from 2015 to 2019 using a two-stage DEA. Technical efficiency scores were regressed against institutional characteristics using Tobit regression to investigate the determinants of efficiency differences amongst hospitals. Results: The mean technical efficiency score for all hospitals was 75%, and it improved by 1% since 2015. The mean pure technical efficiency score was 85% in 2015 and improved to 86% in 2019. The mean scale efficiency score was 89% in 2015 and decreased to 88% in 2019. Only five hospitals were constantly technically and scale efficient. Tobit regression showed that hospital efficiency was significantly associated with the hospital level (secondary or tertiary), number of beds, bed occupancy rate and the average length of stay. Conclusions: Most public hospitals in Kuwait were not technically and scale efficient, but improvements were observed in the overall scores and pure technical efficiencies of these hospitals throughout the study. The identification of the factors influencing efficiency is crucial for hospital managers and policymakers to take evidence-based decisions to improve the technical efficiency of the main health-producing units in the country.