As regards outputs, patients’ health gain is the ultimate measure of output against which hospital activity should be assessed. Since practical difficulties limit this outcomes approach , output is usually measured as an array of health care services that supposedly improve patients’ health. Thus, in this study the multiplicity of hospital services was aggregated into three main outputs: inpatient cases, surgeries and outpatient visits. As far as inpatient services are concerned the number of cases was chosen rather than the (alternative choice of) number of inpatient days in order to avoid distortions imposed by variations in average length of stay due to higher/lower occupancy rates . Furthermore, surgeries were counted separately as they constitute a fundamentally different part of inpatient services (compared to those of general medical) which usually account for a substantial volume of the total inpatient work. Thus, the total number of surgeries was included as a separate output variable in order to capture the workload of this special inpatient component. Finally, the number of outpatient visits was included as the third output variable representing the volume of outpatient services of the hospitals.