Realizing the Value Proposition: A Longitudinal Assessment of Hospitals' Total Factor Productivity

Huerta, Timothy R.; Ford, Eric W.; Ford, William F.; Thompson, Mark A.

doi:https://doi.org/10.1260/2040-2295.2.3.285

Journal of Healthcare Engineering

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Research Article | Open Access

Volume 2 | Article ID 381039 | https://doi.org/10.1260/2040-2295.2.3.285

Realizing the Value Proposition: A Longitudinal Assessment of Hospitals' Total Factor Productivity

Timothy R. Huerta,¹Eric W. Ford,²William F. Ford,³and Mark A. Thompson¹

Received01 Aug 2010

Accepted01 Jun 2011

Abstract

U. S. hospitals are under continual pressure both to increase productivity and to improve quality through the use of Health Information Technology. This paper analyzes 3,187 US hospitals, using data reported to the American Hospital Association, to assess changes in productivity over a five-year period (2002-2006). The Malmquist Indices derived indicate that Total Factor Productivity (TFP) and Efficiency Change (EFFCH) both increased during that timeframe. The low Technological Change (TC) index indicates that improvements to organizational processes did not contribute substantially to productivity. A secondary analysis examined the use of Computerized Physician Order Entry (CPOE) in relationship to the three indices. TFP trended positively for those hospitals further into the CPOE implementation process.

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Copyright © 2011 Hindawi Publishing Corporation. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

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