In a Harvard Business Review (1987) article, Herzlinger and Krasker suggested that not-for-profit hospitals do not return more benefit to society than do for-profit hospitals, and the authors questioned the legitimacy of social subsidization of not-for-profits. Our article reports findings from an empirical reconsideration of the question, "Who profits from nonprofits?" We used hospital data from the same time period (1982) as that used by Herzlinger and Krasker; however, our investigation analyzed a larger data set (including both system and nonsystem hospitals) and used a different statistical technique (discriminant analysis). Our findings suggest that not-for-profits return more social benefit (e.g., in the areas of services provided, access to care, and involvement in professional education) than do for-profits. Like Herzlinger and Krasker, we find that for-profit hospitals may be more efficient than not-for-profits. We caution that public policy regarding social subsidization of not-for-profit hospitals should be made only after more intensive study and thoughtful consideration. (+info)
Birth order in small multihospital systems.
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The strategic behaviors of small multihospital systems have received little attention in the literature despite the fact that small systems are the predominant scale among multihospital systems. This study examines one important aspect of small-system strategic behaviors: the birth-order or evolutionary patterns of hospital acquisition. The evolutionary patterns of acquisition are compared across three strategic model types studied elsewhere: local market, investment, and historical. Using data obtained from a variety of sources, local market model systems are found, in the sequence of acquisition, to be significantly different from the other two model types in terms of relative distances of acquisitions from the initiating or parent hospital, the sizes of acquisition hospitals, the complexity of those hospitals, and the likelihood that the acquisitions are located in rural areas. Differences between parents and acquisitions are also significant, as hypothesized, for the market model system types, although they are not generally significant for the other two model types. The findings suggest that the market model represents an important strategic form that may have important implications for the restructuring of hospital markets. (+info)
Comparison of the activity of short stay independent hospitals in England and Wales, 1981 and 1986.
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From a sample of 19,000 treatment episodes at 183 of the 193 independent hospitals with operating facilities in England and Wales that were open during 1986 it is estimated that 404,000 inpatients were treated in 1986 (an increase of 48% since 1981) and 99,000 day cases (an increase of 112%). It was found that the procedure most commonly performed was abortion, though this made up only 19% of the total caseload in 1986 compared with 30% in 1981, otherwise the case mix in 1986 was similar to that in 1981. Fewer patients came from overseas in 1986 than in 1981, but the distribution by age and sex remained the same, with three quarters of the patients aged between 15 and 65. The estimated bed occupancy in the independent hospitals in 1986 was less than 60% nationally and only 52% in the Thames regions. It is concluded that in these five years the nature of the independent hospital sector changed little, and in 1986 the activity still consisted largely of routine cold elective surgery for people of working age, and the regional differences in admission rates to independent hospitals were nearly as great as in 1981. (+info)
Role of the private sector in elective surgery in England and Wales, 1986.
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From a sample of 19,000 treatment episodes at 183 of the 193 independent hospitals with operating facilities in England and Wales that were open in 1986 it is estimated that 287,000 residents of England and Wales had elective surgery as inpatients in 1986 (an increase of 77% since 1981) and 72,000 as day cases. From 1985 Hospital In-Patient Enquiry data it was estimated that a further 36,000 similar elective inpatient treatments were undertaken in NHS pay beds (a decrease of 38%) and 21,000 as day cases. Overall, an estimated 16.7% of all residents of England and Wales who had non-abortion elective surgery as inpatients were treated in the private sector, as were 10.5% of all day cases. An estimated 28% of all total hip joint replacements were done privately, and in both the North West and South West Thames regions the proportion of inpatients treated privately for elective surgery was 31%. It is concluded that mainly for reasons of available manpower private sector activity may not be able to grow much more without arresting or reversing the growth of the NHS, in which case some method of calculating NHS resource allocation which takes account of the local strength of the private sector will be needed. (+info)
The effect of investor-owned chain acquisitions on hospital expenses and staffing.
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Much concern has been raised about the effect of "corporatization" of health through the expansion of investor-owned hospital chains. One method of expansion is through hospital acquisition. At issue is the question of the effect of acquisitions on expenses and on such patient care inputs as staffing levels. In this article, we examine the effect of acquisition by one investor-owned chain on hospital costs and staffing. Subsequent to acquisition, hospital costs increase and staffing decreases, relative to competitor hospitals. However, since investor-owned hospitals not recently acquired do not have higher cost levels than their competitors, the increase in costs appears to be due to factors associated with the acquisition itself rather than factors associated with being an investor-owned hospital. Under the retrospective payment system in effect at the time, revenues also were higher for acquired hospitals. Under prospective payment, increasing revenues has been more difficult, decreasing acquisition incentives. (+info)