Improving health care service provision by adapting to regional diversity: An efficiency analysis for the case of Germany

The provision of health care in Germany exhibits sizeable geographic variation with a heterogeneous allocation of medical services in rural and urban areas. Furthermore, distinct utilisation patterns and access barriers due to the socio-economic environment might cause inefficiencies in the provision of health care services. Accordingly, an improved understanding of factors governing inefficiencies in health care provision is likely to benefit an efficient spatial allocation of health care infrastructure. We analyse how socio-economic factors influence the regional distribution of (in)efficiencies in the provision of health care services by means of a stochastic frontier analysis. Our results highlight that regional deprivation relates to inefficient provision of health care services. As a consequence, policies should also consider socio-economic conditions to improve the allocation of medical services and overall health.