The impacts of health sector reform on the efficiency and productivity of public and private hospitals in Turkey

Abstract

Hospitals consume the largest share of government health resources. Since they account for such a large share of health expenditure, improvements in their efficiency and productivity will yield tremendous benefits for the entire health sector. On this basis, in 2003, the government of Turkey declared a reform program called “Transformation in Health”. This study by using a rich panel data of 440 hospitals operating in 81 province in Turkey (observed throughout 2001-2007 i.e. pre and post reform periods) addresses the impacts of health sector reform on the efficiency and productivity of the public and private hospitals by employing Data Envelopment Analysis (DEA), bootstrapping and Malmquist productivity index. The results of the analysis indicate that slightly reduced efficiency of previously SSK owned hospitals have been more than offset by increased efficiency in MoH hospitals as well as in private and university hospitals, leading to an accessible, standardized and higher quality health services covering almost the whole population and that in overall, the reform has improved the productivity of all hospitals implying that health sector reform has succeeded.