Health Services Management Research 16, 24±38 # Health Services Management Centre 2003 Hospital ef ciency and patient

The objective of this study was to investigate the relationship between ef®ciency and patient satisfaction for a sample of general, acute care hospitals in Ontario, Canada. A measure of patient satisfaction at the hospital level was constructed using data from a province-wide survey of patients in mid-1999. A measure of ef®ciency was constructed using data from a cost model used by the Ontario Ministry of Health, the primary funder of hospitals in Ontario. In accordance with previous studies, the model also included measures of hospital size, teaching status and rural location. Based on the results of this study, at a 95 % con®dence level, there does appear to be evidence to suggest that an inverse relationship between hospital ef®ciency and patient satisfaction exists. However, the magnitude of the effect appears to be small. Hospital size and teaching status also appear to affect satisfaction, with lower satisfaction scores reported among non-teaching and larger hospitals. This study did not ®nd any evidence to suggest that hospital location (rural versus urban) or religious af®liation contributed to reports of patient satisfaction in any way not explained by the other measures included in the study. The ®ndings imply that low patient satisfaction cannot be explained by excessive management concentration on ef®ciency. Managers should analyse some of the underlying causes of patient dissatisfaction before recon®guring resources. It may be bene®cial in larger hospitals to study the aspects of care that patients have reported they prefer in small hospitals