Do Recovery Plans Improve Public Hospitals Efficiency and Productivity? Evidence from Italy

Monica Giancotti, Seher Nur Sulku, Vito Pipitone and Marianna Mauro

The Italian National Health System has experienced a turnaround since 2007, following the development of formal regional recovery plans aimed at reducing healthcare expenditures in the public spending of the weakest regions. With the season of these recovery plans, the Italian Health System started a process of reorganization of the hospital sector. The purpose of this paper is to analyze the efficiency of Italian public hospitals for the period 2010–2013 and to study the effect of the regional recovery plans on the hospitals' productivity. Technical and scale efficiency of 41 public hospitals were analyzed using data envelopment analysis and Malmquist index. t-test was applied to compare hospital efficiencies across regions with and without recovery plans. Results showed that most of the Italian public hospitals were inefficient. They could improve their performance by reducing the amount of inputs used. Regional recovery plans have not improved hospital efficiency. However, compared to those without recovery plans, the mean efficiency of hospitals has not worsened. Thus, the reforms reached their aim of decreasing public health spending without weakening hospital efficiency. Evaluating the effect of health system reforms on hospital efficiency is crucial for improving the efficiency of the entire healthcare system. This research contributes to the debate about this topic by offering evidence from the Italian context.