Hospital Economics: A Primer on Resource Allocation to Improve Productivity & Sustainability

The biggest issue of economics in a hospital are the resource issues. A resource issue in hospitals creates many problems such as the excessive number of patients, poor service quality, lack of diagnostic tools and equipment, dirty and worn out facilities, long queues at the outpatient clinic, lack of drugs and other medical supplies, low employee morale, and so on. Hospital economics mention three main resource issues in as problems including; (1) Resource allocation issue, (2) Resource management issue, and (3) Generation resources issue.

The main economic problem of resource allocation in hospitals are production and cost function. These two functions related to issues of equality and effectiveness of the hospital. This book specifically discusses on the aspect of hospital resource allocation by highlighting the productivity, competitiveness, cost components, economic burden of disease, and economic aspects of infectious diseases originating from the hospital. The resource management issue is related to the use of existing resources in terms of input and output. The main important economic concept is efficiency, both technical efficiency, economical, and scale, as well as the relationship between these concepts. The resource management issue highlight the economic scale, human resource development, quality development, and lean implementation. The issue of generation resources, includes how the hospital is able to get the resources to run operations without having to cover the access of stratum of community thus violating the principle of equality. This book will highlight the issue of generation resources by including a discussion of the revenue components of the hospital and the impact of DRGs.