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    Measuring efficiency from casemix funding in Victoria using the stochastic frontier

    20455_downloaded_stream_443.pdf (286.5Kb)
    Access Status
    Open access
    Authors
    Mangano, Maria
    Date
    2007
    Type
    Working Paper
    
    Metadata
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    Citation
    Mangano, Maria (2007) Measuring efficiency from casemix funding in Victoria using the stochastic frontier, Centre for Research in Applied Economics Working Paper Series: no. 200710, Curtin University of Technology, School of Economics and Finance.
    Faculty
    Curtin Business School
    School of Economics and Finance
    URI
    http://hdl.handle.net/20.500.11937/20476
    Collection
    • Curtin Research Publications
    Abstract

    The Australian state of Victoria experienced a fundamental change in public hospital funding in 1993 with the introduction of casemix funding using diagnosis related groups. One of the primary drivers of this altered funding regime was to introduce a mechanism by which public hospitals could be compared for costs. Cost comparisons would then create an incentive for efficiency improvements because efficient hospitals would attract increased funding. This paper applies stochastic frontier estimation of a production function to panel data for the period 92/93 to 95/96 in order to establish whether, in fact, efficiency improvements were realised over this period. The results show that there was no significant change to individual hospital efficiency levels.

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