Operation efficiency of China’s medical industry in the context of supply side reform

Abstract

Background: on the context of current medical health supply side reform, medical industry will focus on three aspects accurately, i.e.: “adjusting structure, reducing costs and replenishing short-slab”, whereas the operation efficiency of medical industry is the important issue attracted the attention of academic circles. Methods: the medical industry is easier to be affected by external uncontrollable factors, for instance public health emergency or change in health policy will affect the service cost of hospital, and thence the operation efficiency of medical industry is researched and evaluated by adopting the stochastic frontier cost model. Results: according to the empirical research, Chinese medical industry achieved higher operation efficiency in the process of medical health supply side reform, it reflects not only the higher medical service and management level of medical institution and, but the matching attribute with their current sale. However several hospitals had lower cost efficiency for their medical services, adopted extensive management and involved in insufficient medical resource utilization. Conclusions: the stochastic frontier cost model measures the efficiency of hospital input and output from multiple angles; it has higher scientific nature and adaptability, and complies with the current medical health supply side reform requirements; moreover it is beneficial to expedite to develop Chinese medical industry, reduce operation cost, improve the operation efficiency of medical industry, and boost the medical health supply side reform to achieve success.