Profit efficiency and ownership of German hospitals

authored by

Annika Herr, Schmitz Hendrik, Augurzky Boris

Abstract

This paper investigates the cost and profit efficiency of German hospitals and their variation with ownership type. It is motivated by the empirical finding that private (for-profit) hospitals - having been shown to be less cost efficient in the past - on average earn higher profits than public hospitals. We conduct a Stochastic Frontier Analysis on a multifaceted administrative German data set combined with the balance sheets of 541 hospitals of the years 2002-2006. The results show no significant differences in cost efficiency but higher profit efficiency of private than of publicly owned hospitals.

External Organisation(s)

Friedrich-Alexander-Universität Erlangen-Nürnberg (FAU Erlangen-Nürnberg)
University of Duisburg-Essen
Institute of Labor Economics (IZA)

Type

Article

Journal

Health economics

Volume

20

Pages

660-674

No. of pages

15

ISSN

1057-9230

Publication date

06.2011

Publication status

Published

Peer reviewed

Yes

ASJC Scopus subject areas

Health Policy

Sustainable Development Goals

SDG 3 - Good Health and Well-being

Electronic version(s)

https://doi.org/10.1002/hec.1622 (Access: Closed)