Doctor of Philosophy
Thomas T. H. Wan
The relationship between technical efficiency and quality of care in hospitals is studied in the context of resource availability in hospital organizations. The resource availability of hospitals is conceptualized by organizational slack.
An integrated model is developed encompassing the source of organizational slack, its impact on technical efficiency and on quality of care, and its impact on the relationship between efficiency and quality. Organizational threat as an environmental factor affecting the level of slack is measured by the level of competition and regulation. Organizational slack is measured using financial and operational indicators of the hospitals. Technical efficiency is estimated by efficiency "scores generated using the Data Envelopment Analysis. Mortality rates of Medicare patients are used as the proxy for quality of care in individual hospitals.
The sample is composed of 832 urban, not-for-profit hospitals in the United States. The data are compiled from the Health Care Finance Administration data set and the American Hospitals Association annual survey data set. Hypotheses are tested using ordinary least squares regression and logistic regression.
The analysis reveals that the level of and change in organizational slack have a negative relationship with efficiency and a positive relationship with quality of care. The results also indicate that environmental threat has a negative effect on level of slack, and efficiency has a negative effect on quality of care.
The findings are discussed in terms of the theoretical implications for the concept of organizational slack and the implications for health policy and hospital management.
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