Abstract
China is the most populous nation and considerations of economic efficiency in the social sectors is important for maintaining the wellbeing of such a large population. This is especially true when gauging the performance of the healthcare sector treating the population. In this paper, we examine the total factor productivity (TFP) growth in Chinese medical institutions during the period 2009–2018, which experienced a systemic healthcare reform. In order to identify the contribution from each component of TFP indicators and from each provincial or regional medical institutions, a generalized decomposition of productivity gains is applied to analyze hospital operations based on an aggregate directional distance function (DDF). The results show that the annual average TFP growth rate in Chinese medical institutions is 1.87% that is mainly driven by technological progress (0.75%, per annum), while less contributed by technical efficiency change (0.65%, p.a.) and scale efficiency change (0.47%, p.a.). Disparities of provincial hospital performances are observed that may provide policy implications for decision makers.
Highlights
Since the reform and opening in 1978 of markets and trade, the Chinese healthcare system has experienced significant changes covering policy making, equipment replacement, organization management, institution expansion, staff training, and so on [1]
The trend of total factor productivity (TFP) growth in Chinese medical institutions was around 1.87% per annum that is mostly driven by the component of technological progress (TP) (0.75%, p.a.), which implies technological innovation or managerial measure in medical institutions is improving during the sample period
The result shows that the annual average TFP growth rate in Chinese medical institutions is around 1.87% and technological progress is the main driving force
Summary
Since the reform and opening in 1978 of markets and trade, the Chinese healthcare system has experienced significant changes covering policy making, equipment replacement, organization management, institution expansion, staff training, and so on [1]. Changes have focused on the increase in public financing for hospitals. The impetus for this change was that the healthcare system was not functioning with low quality and high costs. Government oversight is accomplished through regulations, laws, and direct ownership of institutions providing healthcare and other social good services [2]. In 2002–2008, the government implemented reforms of social insurance to pay for hospital care. After 2009, reforms included increased public financing as well as promoting prevention to reach a “healthy China” by 2020
Sign-in/Register to view highlights & summary 
Published Version (
Free)
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call