Cost Efficiency of Public Hospitals - A Case Study on District Hospitals In Andhra Pradesh

Abstract

This paper aims to study the cost efficiency of public hospitals in the State of Andhra Pradesh (before bifurcation). For this purpose, 12 district hospitals were selected from different regions of Andhra Pradesh state and their common Decision Making Units (DMUs) identified. The Data Envelopment Analysis (DEA) econometric tool has been used to measure the efficiency and the best performing hospitals have been ranked. The data was collected from Andhra Pradesh Vaidya Vidhana Parishad (APVVP) for five years. The analysis is done by classifying the data into Input, Output and Explanatory variables. The results show that few hospitals are ranked high due to consistent performance and other hospitals who scored less are low performing hospitals during the period of study.