Performance Efficiency of Indian Private Hospitals Using Data Envelopment Analysis and Super-efficiency DEA

Abstract

India is expected to be ranked among the top three healthcare markets in terms of growth by 2020. The scale and scope for delivery of quality healthcare services demand high levels of service performance to provide effective and efficient services to patients. The purpose of this study is to assess the performance efficiency of Indian private hospitals using data envelopment analysis (DEA) and super-efficiency DEA. The analysis uses an output-oriented approach with a mix of four inputs and one output variables to identify the most efficient hospitals. In the first stage, a sample of 25 private hospitals is evaluated using DEA, and in the second stage, the same sample is analysed using super-efficiency DEA for discriminating the performance of the efficient hospitals. The results show seven hospitals as the most efficient ones using DEA in the first stage. Fortis Hospital Ltd emerges as the super-efficient hospital using super-efficiency DEA analysis in the second stage. The results obtained have managerial implications and provide the decision maker (DM) the requisite guidance for corrective actions.