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Measurement of hospital efficiency, using a latent class stochastic frontier model

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This article analyses the technical efficiency of Portuguese hospitals from 1997 to 2008 with the latent class frontier model, enabling the identification of different segments in the cost frontier. It is found that there are three statistically significant segments in the sample, leading to the conclusion that no common health policy can be applicable to all the hospitals analysed, calling rather for policies conceived for each hospital segment identified. The health policy based in the identified segments enables a more accurate and cost effective management of resources.

Keywords: C29; I1; hospitals; latent class model; panel data; stochastic cost frontier; technical efficiency

Document Type: Research Article


Affiliations: 1: Instituto Superior de Economia e Gestão, Technical University of Lisbon, Lisbon, Portugal 2: Department of Economics,University of Azores and CEEAplA, Rua da Mãe de Deus9501-801 Ponta Delgada, Portugal

Publication date: 2013-01-01

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