What is the difference between specialisation and diversity in hospitals? Investigating their relationship with efficiency

The relationship between hospital specialisation and efficiency is crucial for managing hospital services. We discuss hospital specialisation as a specific instance of the more general concept of diversity and the conceptual opposite of variety. Unlike prior studies that focus on specialisation measures without a theoretical background, we employ the Blau Index, based on the concept of variety, enabling us to assess diversification's impact on efficiency. We apply the non-parametric meta-frontier approach to a sample of Italian hospitals from 2000 to 2019 in a two-stage analysis. In the first phase, we employ Data Envelopment Analysis (DEA) to evaluate healthcare efficiency. In the second phase, we use bootstrap truncated regression to explore the impact of hospital specialisation and various organisational factors on efficiency. Our findings challenge the prevailing assumption that specialisation leads to higher efficiency, showing instead that hospitals with greater diversification tend to perform better. Hospital managers and regional decision makers can leverage this insight to make informed strategic decisions regarding strategic planning for service delivery. • Hospital specialisation as a conceptual opposite of variety. • Efficiency analysis of Italian hospitals from 2000 to 2019. • We employ the Blau index based on the concept of variety. • Two-stage analysis with bootstrap truncated regression is applied. • Hospitals with greater diversification tend to perform better.