A conceptual framework for selecting the most appropriate variables for measuring hospital efficiency with a focus on Iranian public hospitals.

Over the past few decades, there has been an increasing interest in the measurement of hospital efficiency in developing countries and in Iran. While the choice of measurement methods in hospital efficiency assessment has been widely argued in the literature, few authors have offered a framework to specify variables that reflect different hospital functions, the quality of the process of care and the effectiveness of hospital services. However, without the knowledge of hospital objectives and all relevant functions, efficiency studies run the risk of making biased comparisons, particularly against hospitals that provide higher quality services requiring the use of more resources. Undertaking an in-depth investigation regarding the multi-product nature of hospitals, various hospital functions and the values of various stakeholders (patient, staff and community) with a focus on the Iranian public hospitals, this study has proposed a conceptual framework to select the most appropriate variables for measuring hospital efficiency using frontier-based techniques. This paper contributes to hospital efficiency studies by proposing a conceptual framework and incorporating a broader set of variables in Iran. This can enhance the validity of hospital efficiency studies using frontier-based methods in developing countries.