A two-stage DEA model to evaluate the efficiency of the Italian health system

Over the past twenty years, important changes in the Italian health system have led to different approaches in organizing, delivering and financing health services throughout the regions of the country. This study aims to examine the impact these factors have had on efficiency. The methodology adopted is based on the developments in bootstrapping Data Envelopment Analysis (DEA). In particular, employing a two-stage procedure, we analyzed the impact that political interventions have produced on healthcare efficiency. The data, which were at the local health unit level for the period 2004-2005, were aggregated to the provincial level in order to take into account patient mobility. The study reveals that the organizational model adopted by the Lombardia region allows for the best results in healthcare efficiency. Second, administrative decentralization from the regional governments to local health units is a source of inefficiency. Third, adjusting the cost of delivering care, by taking into consideration regional health characteristics, improves efficiency. Finally, future policy interventions should make careful valuations of the impacts of patient mobility on healthcare efficiency.