Examination on level of scale efficiency in public hospitals in Tanzania

Abstract

Purpose: Tanzania has implemented policies that aim at improving health sector performance as well as the general health status of citizens. Establishment of community insurance fund, increase government budget allocation in health sector, establishment of institutions for critical and special diseases like Tanzania Ocean road cancer institute, Muhimbili Orthopaedic Institute and many other that aim at improving sector efficiency. These efforts and policies had a direct impact on improving the health sector and achieving Sustainable Development Goals (SDGs). Despite these improvement efforts, the health sector continues to face enormous challenges. Among the major challenges identified is the level of inefficiencies in healthcare delivery. It is for this reason; this paper examines the scale efficiency level in Tanzania's public hospitals.

Methods: Using data from the Ministry of Health, this paper employs the Input based Data Envelopment Analysis (DEA) to examine Tanzania's public hospital efficiency levels. DEA has been applied because it can handle multiple inputs and output that can have different units simultaneously.

Results: Findings showed that the average scale efficiency was 78.6%.and 72.9%for regional and district hospitals respectively. Additionally, 43.8% of the regional referral hospitals attained the most productive scale size compared to 21.05% in district hospitals.

Conclusion: The study concludes that there is dire need for the ministry of health to consider resource reallocation across public hospitals. Periodic re-estimation of efficiency levels coupled with increased health care input injection is of urgent need.

Keywords: Data envelopment analysis; Public hospitals; Scale efficiency.