Do Geographical Locations Affect in Hospitals Performance? A Multi-group Data Envelopment Analysis

Hospitals are the main and the last component of the health care systems. Therefore, evaluating the performance of hospitals is vital. Several studies are done in hospitals evaluation, but almost none of them consider the geographical features. This paper proposes a new approach for evaluating hospitals. In the proposed approach, hospitals are classified into various groups and each group is equivalent to a province. It causes hospitals in each category (province) must be evaluated in homogenous environment. For this purpose, the conventional data envelopment analysis (DEA) model has been developed to this structure. The main feature of the proposed model is that it takes into consideration the geographical location. In other words, we propose a multi-group DEA model. The data on 288 Iranian hospitals grouped under 31 provinces are used to demonstrate the model. The results show that the efficiency scores are greatly changed when hospitals are evaluated in own groups.