Measuring efficiency is a difficult business. As AHRQ, “In most cases, individuals and firms will define efficiency as a relationship between what it costs them and what service or outcome they receive, rather than as a trait inherent in the provider.”
Further, efficiency can be measured as either production efficiency or allocative efficiency. “For example, a physician may produce CT scans efficiently in her office, but the physician may not appear efficient to a health plan if a less expensive diagnostic test could have been substituted in some cases.”
This table lists some of the more common efficiency measures.
Measuring efficiency is a difficult business. As AHRQ, “In most cases, individuals and firms will define efficiency as a relationship between what it costs them and what service or outcome they receive, rather than as a trait inherent in the provider.”
Further, efficiency can be measured as either production efficiency or allocative efficiency. “For example, a physician may produce CT scans efficiently in her office, but the physician may not appear efficient to a health plan if a less expensive diagnostic test could have been substituted in some cases.”
This table lists some of the more common efficiency measures.