The Comparison of Productivity Change Gap of Public Hospitals and Private Hospitals in Korea

Abstract

This study calculated meta Malmquist indices and their bootstraped estimates and then decomposed them into technical efficiency change(TEC), technology change(TC), pure technology catch up(PTCU), frontoer catch up(FCU), using annual data set of general hospitals from year 2007 to 2011 collected by Korean Hospital Association and then analyzed productivity change and technology gap of Korean general hospitals. The results and implications were as follows below. First, public general hospitals showed higher meta technical efficiencies than private general hospitals while exhibited lower technology gap ratio which meant a few large private general hospitals led the whole general hospitals. Second, group productivity of private general hospitals increased larger than public general hospitals due to the differences of PTCU rather than FCU. But, there was no statistically significant differences for technical efficiency, productivity change, technology gap. Thus, public general hospitals played the same role as the private general hospitals in terms of the number of patients treated. But, considering financial hardships of public general hospitals, public hospitals needed to share and learn medical and managerial skills of the best practice of private general hospitals.