A Longitudinal Analysis of Local Health Department Efficiency

Research around how efficiently Local Health Departments (LHDs) deliver public health services is still an emerging body of work. Much less is understood about how efficiency changes over time. This analysis seeks to understand how efficiently LHDs across the US are delivering public health services and how efficiency changed between 1998, 2006, and 2012. Panel stochastic frontier analysis (SFA) is used to create an estimate frontier of LHD efficiency (n=729). SFA is an econometric technique that uses an input/output ratio to determine an optimal production bundle that can then be used as an estimation of the ideal production function (technical efficiency). Inputs for the model consist of full time equivalent (FTE) employee data, federal funding, and socioeconomic and demographic characteristics from the 1997, 2005, and 2010 waves of the National Association of County and City Health Officials (NACCHO) Profile of Local Health Departments and the outputs are measures of public health service availability and perceived effectiveness from the 1998, 2006, and 2012 waves of the National Longitudinal Survey of Public Health Systems (NLSPHS). The NLSPHS follows a nationally-representative cohort of local public health systems over time, profiling the availability of 20 core public health services, the organizations that deliver each, and the perceived effectiveness. Average technical efficiency score among LHDs is 0.84, meaning that the typical LHD in our sample operates with 16% inefficiency. Technical efficiency ranges from a low of 43%, to a high of 5%. Mean, minimum, and max efficiency did not significantly change between 1998, 2006, and 2012. Inefficiency does exist in LHD operation, although there is wide heterogeneity in technical efficiency. LHD efficiency does not vary greatly overtime, suggesting that LHDs may be resilient in adjusting production to achieve efficiency in operation despite economic shocks.