Using DEA to estimate potential savings at GP units at medical specialty level

• Published in: Socio-economic planning sciences 2014-03, Vol.48 (1), p.38-48
• Main Authors: Thanassoulis, Emmanuel, Silva Portela, Maria C.A., Graveney, Mike
• Format: Article
• Language: English
• Subjects: Allocative efficiency; Cost efficiency; Cost-effectiveness; Data envelopment analysis; DEA; Economic analysis; Health economics; Planning theory; Price efficiency; Primary health care
• ISSN: 0038-0121; 1873-6041
• DOI: 10.1016/j.seps.2013.11.001

The aim of this paper is to identify benchmark cost-efficient General Practitioner (GP) units at delivering health care in the Geriatric and General Medicine (GMG) specialty and estimate potential cost savings. The use of a single medical specialty makes it possible to reflect more accurately the medical condition of the List population of the Practice so as to contextualize its expenditure on care for patients. We use Data Envelopment Analysis (DEA) to estimate the potential for cost savings at GP units and to decompose these savings into those attributable to the reduction of resource use, to altering the mix of resources used and to those attributable to securing better resource ‘prices’. The results reveal a considerable potential for savings of varying composition across GP units. •The paper assesses the scope for savings at medical specialty level.•DEA is used to identify cost savings.•Cost savings of referrals and drug prescriptions are disentangled in volume, mix, and prices.•Potential cost savings of the order of 17% of aggregate cost are identified.•The bulk of savings is attributable to volume of drugs prescribed followed by inpatient unit costs.