The Regional Total Factor Productivity Changes of Healthcare Delivery in China: A Bootstrap Malmquist Data Envelopment Analysis

Abstract

Improving the productivity of healthcare delivery and optimizing the allocation of regional healthcare resources are crucial for the health providers. The objective of this study is to evaluate the productivity dynamics of healthcare delivery at the regional (provincial) level in China, to provide evidence-based policy implications. After a review of literature, actual number of open beds, number of occupational or assistant doctors, number of registered nurses, and number of other staff were selected as input variables. The number of diagnostic visits and number of discharged inpatients were adopted as the output indicators. The panel data of 31 provinces in mainland China from 2010 to 2019 were extracted from Health Statistics Yearbook. Bootstrap-Malmquist Data Envelopment Analysis (DEA) model was used to measure the total factor productivity changes (TFPC) and its components. During the study period, the analysis of total factor productivity (TFP) in China revealed a declining trend with an average annual decline of 0.9% (ranging from 0.860 to 1.204). For each of the 31 provinces, the annual TFP scores varied from 0.971 to 1.029. On average, technical efficiency changes (TEC) had showed a downward trend from 2010-2011 (0.980) to 2013-2014 (0.982), and then an upward trend in 2014-2015 (1.029) and the following three consecutive years since 2016-2017 (1.000, 1.013, 1.009). Similarly, the trend in technological changes (TC) was consistent with the TEC from 2010-2019, which fluctuated between 0.969 and 1.011 on average per year at the provincial level. Notably, the point of inflection appeared at 2013-2014. Regional healthcare inputs and outputs in mainland China saw an upward trend from 2010 to 2019. However, TFPC, TEC, and TC decreased across all 31 provinces. TFP experienced a declining trend from 2010 to 2014, followed by growth until 2019. This may be related to the new healthcare reform being implemented since 2009, as service efficiency and capacity may undergo a reversal at the beginning of the reform.