A study of the production technology of the U.S. dental care industry — A non-parametric approach

Abstract

Over the last three decades, dentistry has been a growing health care industry in the U.S. Although a significant amount of research has been done on various aspects of the U.S. dental care industry, few investigate productivity or efficiency of dental practices. This paper aims to contribute to the literature on the production prospect of the U.S. dental care industry at practice level. We apply the non-parametric Data Envelopment Analysis (DEA) method on the American Dental Association (ADA) Survey 2005 data to evaluate dental practice efficiencies. Our finding shows that the radial output-oriented DEA technical efficiencies among 117 sample practices vary from 0.561 to 1, with the mean equal to 0.907. The second-stage regression analysis represents that the overall technical efficiency is positively related to intensity of competition, dental hygienist delegation, percentage of patients from urban area, and negatively related to percentage of patients who do not have insurance or fail to show up for appointments.