Time-varying production efficiency in the health care foodservice industry: A Bayesian method

Cost containment, budget control, and improvements in efficiency are key drivers of the way health care foodservice operations (internal hospital foodservice departments that produce/reheat food and deliver them to patients) will respond to emerging economic and population trends. These factors are the motivation for this study, which aims to assist health care policy makers in identifying operational strategies for efficiency improvements. The study applies a Bayesian method in deriving to efficiency estimates, using panel data on key Australian hospitals. The results show that the model satisfies the theoretical economic requirements. Important relationships are identified between the level of meal production and other input and environmental variables. The efficiency results indicate that the performance of health care foodservice operations is improving over time and reached its highest level in the operating year 2007. The paper identifies some factors related to efficiency improvements, and offers some suggestions for future improvement strategies.