Master of Science (MS)


Agricultural Economics

Document Type



As healthcare costs and premiums have increased in the recent past, hospitals are forced to try to provide healthcare on tight budgets. In many cases, quality is often sacrificed in an effort to manage patient wait-times and costs. This research attempted to add to the existing body of knowledge of quality of care by defining a relationship between quality of care provided and total hospital costs. This study used the 2006 American Hospital Association’s Annual Survey Database and the 2006 Hospital Compare dataset to meet the data requirements for the study. A log-log, as well as a translog, cost function was used to estimate the relationship between quality of care provisioned for community acquired pneumonia and heart failure and total hospital costs. Regressors for the cost function included hospital outputs, inputs and wages as well as variables for patient-mix, case-mix, ownership status and medical school affiliation. Ultimately this study concluded that by increasing the quality of care score associated with community-acquired pneumonia by ten percent would decrease total hospital costs by 2.44 percent. However, several improvements were found that would improve the ability of the quality of care data and estimation methodologies to more comprehensively represent quality.



Document Availability at the Time of Submission

Release the entire work immediately for access worldwide.

Committee Chair

Keithly, Walter R Jr