| This research is an optimization study of the technical efficiency and performance of military hospitals from 1998 through 2002. Data Envelopment Analysis (DEA) is the methodology used to measure efficiency. Input variables are Costs, Beds, FTEs, and Services Offered. Output variables are Surgical Visits, Ambulatory Patient Visits, Emergency Visits, Case Mix Adjusted Discharges, and Live Births. The unit of analysis (Decision Making Unit) is the free standing medical treatment facility (MTF, i.e., military hospital).; Data for this study were obtained from the Assistant Secretary of Defense for Health Affairs on all N = 2,513 military healthcare facilities in operation as of 2002. A total of 390 MTFs met screening criteria for study inclusion. Structural contingency theory and the Structural Adaptation to Regain Fit (SARFIT) model guide theoretical development. The research question addressed: “How is optimal technical efficiency determined for Department of Defense MTFs?”; Eleven optimization models are proposed and ten sensitivity comparisons made, to establish one parsimonious model. Criteria are presented to guide the selection of this model. From the selected model, the study found that 119 (31%) of the MTFs are efficient. The average efficiency score is 89%. The average efficiency score declined from 91% in 1998 to 89% in 2002. The Air Force has the most efficient population of hospitals (92%), followed by the Army (89%), and the Navy (87%). Analysis of weighted measures suggests that all three services place the most emphasis on costs (38%) in seeking to be efficient. The Army and Navy place the least emphasis on number of beds (18%, 11%), and the variable of least importance for the Air Force is FTEs (7%). Results suggest that an efficient MTF is likely to have less than 150 beds, and is more likely to be found in the Air Force. The study found support for a SARFIT performance efficiency parabola phenomena (PEPP). For two-thirds of the facilities examined, efficiency scores rose in one period, then declined in the next period, and rose again in the last period. This suggested an efficiency life cycle and performance heartbeat for military hospitals. |
