Social Science & Medicine 56 (2003) 343–353 Technical and cost efﬁciency of oral health care provision in Finnish health centres Miika Linna a, *, Anne Nordblad a , Matti Koivu b a National Research and Development Centre for Welfare and Health, Siltasaarenkatu 18, PO Box 220, 00531 Helsinki, Finland b Helsinki School of Economics, Helsinki, Finland Abstract In this study we measured the productive efﬁciency of public dental health provision across Finland. The analysis was based on data envelopment analysis (DEA) using linear programming. In addition, we investigated various factors explaining the technical and cost efﬁciency of public dental care using a parametric Tobit model. These analyses revealed substantial variation in productive efﬁciency between health centres in different municipalities. The level of cost inefﬁciency was generally between 20% and 30%. Good dental health of the population, high rates of unemployment and high per capita expenditure on primary care in the municipality were associated with technical and cost inefﬁciency. According to the results, cost efﬁciency would not be improved by shifting input allocation towards more auxiliary manpower in health centres. Individual efﬁciency scores were clearly sensitive to the choice of output speciﬁcation. Changing the unit of output measurement from visit- to patient-based measures affected markedly the ranking of dental health centres. However, the set of exogenous correlates associated to inefﬁciency was strikingly similar for both types of output speciﬁcation. More resources are needed if the coverage of public dental care is extended to all age groups. The health centre speciﬁc efﬁciency scores obtained in this study can be used locally to evaluate, design and implement structural changes in the production processes. r 2002 Elsevier Science Ltd. All rights reserved. Keywords: Oral health; Financing; Cost efﬁciency; Data envelopment analysis; Finland Introduction In recent years, numerous policy initiatives for cost containment and productivity increase in public dental services have been made in Scandinavian countries. During the same period, reductions in public spending have intensiﬁed the need for efﬁciency improvements in all public services. In Finland, subsidised dental care is provided by public health centres for all citizens born after 1956 and also for some special groups, e.g. veterans. The coverage provided for other groups (usually older citizens) varies greatly across the munici- palities which host and fund the health centres. The lack of continuity is considered a serious problem both from equity and efﬁciency perspectives, since access to subsidised public dental care is determined by place of residence, and dental health is usually better in younger age groups. The evaluation of the possibility and consequences of extending the services to older age groups requires knowledge of the production technol- ogy, productivity and efﬁciency of public dental services. However, none of the scarce studies on the productivity of dental services has measured technical efﬁciency (TE), which is often a rather important determinant of productivity. Most of the productivity studies of dental practices in the United States (Gift, Newman, & Loewy, 1981; Gotowka, 1985) have concerned private dental provi- sion (Mitry, Johnson, & Mitry, 1976; Saving, 1978; Nash & Wilson, 1979; Feldstein, 1974; Arnold, 1975; Lipscomb & Schefﬂer, 1975). Research issues included the operation of dental care markets and how dental *Corresponding author. Tel.: +358-9-3967-2295; fax: +358- 9-3967-2485. E-mail address: miika.linna@stakes.ﬁ (M. Linna). 0277-9536/02/$-see front matter r 2002 Elsevier Science Ltd. All rights reserved. PII:S0277-9536(02)00032-1