The production of health in the Philippines: A study using hospital-level data for the years 1999-2002

• Main Authors: Aliping, Nashrine Bawigan, Del Ayre, Kris Angeline Reandino, Toledo, Darryl Karl Danazart Von Tenorio
• Format: text
• Language: English
• Published: Animo Repository 2007
• Subjects: Hospitals > Philippines; Medical care > Philippines; Hospitals > Philippines > Staff; Medical personnel > Philippines
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/7374
• Institution: De La Salle University

Hospitals are one of the most important institutions in a community. These institutions play an important role in the healthcare system of a country in their provision of services that are crucial to the needs of the population. Hospitals provide curative services for illnesses and diseases, a training ground for medical workers, provide medical resources and technologies, a training and research institution, provide community services, and provide primary care that brings community people to work together. It is also with this that hospitals help the population be more productive. The healthcare system of our country, however, is currently pressed with a controversial issue, which is the deterioration of healthcare in the Philippines. It has been reported that hospitals are now suffering from a decreasing nurse to patient ratio especially in rural areas. In addition, there were already 1000 hospitals that closed since start of the new millennium. The reason for this worsening situation is pointed towards the unprecedented migration of health care workers, especially nurses. Matched with the fluctuating budget for the Department of Health, the possibility of providing quality health services might not be foreseeable in the future. With this, the study is geared towards knowing the role of health workers in the provision of hospital services. The primary objective is to show the role of health workers, especially doctors and nurses by estimating a production function and computing their corresponding output elasticities and marginal productivities. In addition, the study also delved into the difference in the provision of hospital services first, between the type of ownership (i.e. government or privately owned) and second, between the service capability (i.e. secondary or tertiary classification) of a hospital. Previous studies, as well as the theory of production tell that a transcendental logarithmic (translog) production function can be used in this study. This function is a generalized form of the Cobb-Douglas production function which not only takes into account the factor inputs itself but also the interaction between two inputs that indicates how one factor input affects another. Several measurement issues exist in the literature on what output to consider as the best proxy for the services provided by a hospital thereby causing the researchers to use more than one output. The outputs used are the most common measures-admissions and recovery, and in addition to this, outpatient visits to include consultation as one of a hospital's services and death rate as a measure of the final output of a hospital. On the other hand, the factor inputs include the usual labor and capital inputs in which labor inputs include doctors, nurses, and other medical workers while the capital input is hospital beds. These factor inputs are the same for all the four hospital outputs identified. Dummy variables for the type of ownership and service capability were included to measure any systematic difference for government and privately owned hospitals and for having additional services available in tertiary hospitals. The estimation procedure used to simultaneously estimate four translog production functions is the seemingly unrelated regressions modeling. The data used in this study is from the Hospital Statistical Reports submitted by hospitals to the Bureau of Health Facilities and Services (BHFS) of the Department of Health. The sample includes 39 private hospitals and 27 government hospitals throughout the years 1999-2002. Overall, there are 66 hospitals and with four years of available data for each hospital, the panel data formed has a total of 264 observations. The study was able to present rich descriptive statistics that show the trend of the data for the four-year time period and substantial difference in the provision of hospital services between government and private hospitals as well as between tertiary and secondary hospitals. Public hospitals have higher volume of admissions than private hospitals as supported by higher aggregate number of impatient and higher occupancy rate. This led to lower average recovery rate and higher average death rate. Hence, it could be argued that public hospitals offer less quality services because of less efficient facilities, equipment's and health-workers. With regards to hospital category, tertiary hospitals have higher volume of admissions as supported by the aggregate number of inpatients and the higher occupancy rate. This led to a higher average death rate and lower average recovery rate for tertiary hospitals. However, the differences in the respective variables are small given the fact that tertiary hospitals have better equipment's and facilities as manifested by their ability to cater to specialized cases. Hospital beds have a positive marginal productivity on admissions and recovery. However, beds have a very minute positive contribution to death rate. Doctors are by far the most productive resource in a hospital. It has positive marginal productivities for admissions, recovery, and outpatients. In addition, it has no effect on death rates. The nursing staff on the other hand has a negative marginal productivity for outpatients and no effect on the other outputs. Lastly, other medical staff does not have any effect on hospital outputs as the output elasticities of this hospital input, are insignificant.