The Efficiency and Budgeting of Public Hospitals: Case Study of Iran

Abstract

Reduction of surplus production factors through comprehensive planning based on the results of the Data Envelopment Analysis can play a major role in cost reduction of hospitals and health sectors. In hospitals with a technical efficiency score of less than one, the original and projected values of inputs were different; resulting in a surplus. Hence, these hospitals should reduce their values of inputs to achieve maximum efficiency and optimal performance. The results of this method was applied to hospitals a benchmark for making decisions about resource allocation; linking budgets to performance results; and controlling and improving hospitals performance.