International comparisons of health care costs focus on macro-economic measures such as health expenditures divided by GDP, but have been remiss in identifying micro-economic causes for any differences. We take a first step to fill this void by comparing hospital production performances in France vis-ŕ-vis the US, since we have comparable data sets (for acute care) for both countries’ hospitals on specific and relelvant inputs and outputs commonly used in hospital production studies. One major difference, between the French and US hospital industries is the public versus private sectors role. Public spending for health in France has historically been about 76% ; whereas in the US, public spending comprises about 45%, substituting the public sector for the private, more market-oriented approach. Because of these inherent differences, we cannot specify a stochastic cost or profit function to capture their underlying technologies. Therefore, we opt to measure productive performance via data envelopment analysis (DEA), which results in the best practice frontier of our sample hospitals. By relaxing certain constraints of the model, we determine the substitutability of various inputs (which is relevant since French hospitals hire more physicians – whereas in the US, physicians are more apt to substitute their own time for hospital inputs) ; substitutability of outputs, particularly outpatient vs inpatient care; and negative marginal productivity (congestion) of some inputs, for example medical residents. It is our objective to determine the comparability of these two countries’ hospital sectors that provides additional micro-economic information on underlying causes of differences in productivity.
Learning Objectives: NA
Presenting author's disclosure statement:
Organization/institution whose products or services will be discussed: None
I do not have any significant financial interest/arrangement or affiliation with any organization/institution whose products or services are being discussed in this session.