Title: The determinants of financial performance at public services of regional hospital

Authors: Wartono Wartono; Guntur Riyanto; Djoko Suhardjanto

Addresses: Universitas Sebelas Maret, Surakarta, Indonesia ' Universitas Sebelas Maret, Surakarta, Indonesia ' Universitas Sebelas Maret, Surakarta, Indonesia

Abstract: This study aims to test the factors that influence the financial performance of regional public hospital (Rumah Sakit Umum Daerah – RSUD) with public service agency (Badan Layanan Umum – BLU) status in Indonesia by putting an emphasise on four aspects, which are the income structure of BLU, cost efficiency, liquidity, and regional characteristics. The analysis is conducted on the data from 43 RSUD from 2013 to 2019 with a total observation of 215. Financial performance is measured using four indicators, namely asset turnover, fixed asset turnover, service revenue ratio divided by total assets and surplus (deficit) ratio divided by total income. The finding of this study shows that liquidity has a positive and significant effect on financial performance. Additionally, RSUD income structure that relies on service income has not been able to drive significant improvement in financial performance. This study also shows that there is no difference in financial performance between RSUD in Java and another region. The study finds that RSUD owned by district government has better financial performance compared to RSUD owned by the municipal government.

Keywords: financial performance; public service agency; regional public hospital; income structure; cost efficiency; liquidity; regional characteristics.

DOI: 10.1504/IJEPEE.2025.146769

International Journal of Economic Policy in Emerging Economies, 2025 Vol.21 No.4, pp.365 - 382

Received: 17 Feb 2021
Accepted: 23 Apr 2021
Published online: 17 Jun 2025 *

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