Comparative performance assessment in managed care: data envelopment analysis for health care managers

In health care markets increasingly dominated by managed care, health care managers need sophisticated yet understandable comparative performance assessment methods. Ideally, these methods should provide targets for the managers to improve program or organization performance. This article reviews three comparative performance methodologies with a comprehensive explanation of data envelopment analysis (DEA). DEA is a form of linear programming that allows for the inclusion of multiple input and output/outcome performance variables from a virtually unlimited number of organizations, facilitating meaningful health service provider comparative assessments.