Obamacare and Environmental Production Efficiency Rankings for the 50 U.S. State Governments: A Data Envelopment Analysis of Health Outcomes from Environmental Factors and State Health Care Expenditures

Abstract This paper examines the health performance rankings of the 50U.S.state governments (SGs), and addresses the relationship between SG performance rankings and SG environmental health, economic prosperity, and state health-care policy. We use the data envelopment analysis (DEA) to estimate and compare the relative performance of the 50 SGs in a single measure. Our analyses indicate that new federal mandates, such as, universal or nearly universal health care coverage, and timely resources or lack of them from the federal government, may lead to very different state health performance outcomes. Our analyses also highlight the tradeoffs between given inputs and desired outputs involved in attaining a certain level of health performance efficiency. In particular, they show that limiting harmful exposures by timely investments in prevention is far more cost-effective than subsequent incurrence of health care expenditures in treatment of the affected population. Finally, our findings indicate that a fixed amount of federal funding per capita could lead to different health performance outcomes in different states, depending on the level of efficiency with which the SG operates during the funding period.