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Getting out what we put in: productivity of the English National Health Service

Published online by Cambridge University Press:  28 October 2010

Adriana Castelli ,
Mauro Laudicella ,
Andrew Street  and
Padraic Ward
Adriana Castelli
Affiliation:
Centre for Health Economics, University of York, Heslington, York, UK
Mauro Laudicella
Affiliation:
Centre for Health Economics, University of York, Heslington, York, UK
Andrew Street*
Affiliation:
Centre for Health Economics, University of York, Heslington, York, UK
Padraic Ward
Affiliation:
Centre for Health Economics, University of York, Heslington, York, UK
*
Correspondence to: Andrew Street, Centre for Health Economics, University of York, Heslington, York YO10 5DD, UK. Email: andrew.street@york.ac.uk
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Abstract

Many countries are incorporating direct measures of non-market outputs in the national accounts. For any particular output to be included there has to be data about it for two adjacent periods. This is problematic because the classification of non-market outputs is often subject to wholesale revision. We outline the challenges associated with classification changes and propose a solution. To illustrate we construct output and input indices and estimate productivity growth of the English National Health Service (NHS) for the period 2003–2004 to 2007–2008. Our index of output growth incorporates all care provided to NHS patients and captures improvements in survival rates, waiting times and disease management. We find that more patients are being treated and the quality of the care they receive has been improving. We implement our approach to dealing with changes as to how health services are defined and show what effect this has on estimates of output growth. Our index of input growth captures all labour, intermediate and capital inputs into health service production and we improve on how capital has been measured in the past. Inputs have increased over time but there has also been a slowdown since 2005–2006, primarily the result of a levelling off in staff recruitment and less reliance on the use of agency staff. Productivity is assessed by comparing output growth with growth in inputs, the net effect being constant productivity growth between 2003–2004 and 2007–2008.

Type
Articles
Information
Health Economics, Policy and Law , Volume 6 , Issue 3 , 16 June 2011 , pp. 313 - 335
Copyright
Copyright © Cambridge University Press 2010

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