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The efficiency of the delivery of neonatal care in the UK

Lookup NU author(s): Dr Bruce Hollingsworth, Dr David Parkin

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Abstract

Background A recent paper in Journal of Public Health Medicine (O'Neill et al., 2000; 22(1): 108-115) used regression modelling to determine the average costs of neonatal care services for a sample of 49 units in the United Kingdom in 1990-1991, and concluded that economies of scale were present in the sample as a whole. Although this form of modelling is useful, analysis of the efficiency of production for individual units is also important. Methods Data envelopment analysis (DEA) was used to analyse the data set published by O'Neil et al., to determine technical efficiency of neonatal units, measuring efficiency compared with a benchmark efficient frontier, and estimating economies of scale for each unit. Potential cost savings if units were to operate efficiently are estimated. Results There is evidence of substantial levels of technical inefficiency. Economies of scale varied between units, with increasing returns in the 36 inefficient units, and mainly constant returns in the 13 efficient units. This suggests that the presence of technical inefficiency was as important as scale inefficiencies. Total cost savings, if all units were operating efficiently, are estimated at £10.4 million, equivalent to 10 extra units producing 57 000 additional days of care. Conclusions DEA is a technique of great potential value in analysing the efficiency of health care production. As well as inefficiencies in the production of neonatal care in the United Kingdom due to differences in the scale of production, there appears to have been considerable technical inefficiency, which was not due to differences in case mix. The potential cost savings from efficiency gains are large.

Publication metadata

Author(s): Hollingsworth B, Parkin D

Publication type: Article

Publication status: Published

Journal: Journal of Public Health Medicine

Year: 2001

Volume: 23

Issue: 1

Pages: 47-50

Print publication date: 01/01/2001

ISSN (print): 0957-4832

ISSN (electronic): 1741-3850

Publisher: Oxford University Press

URL: http://dx.doi.org/10.1093/pubmed/23.1.47

DOI: 10.1093/pubmed/23.1.47

PubMed id: 11315693

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