Analysis of the rationale for, and consequences of, nonprofit and for-profit ownership conversions.
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OBJECTIVES: To examine percursors to private hospitals conversion, both from nonprofit status to for-profit status and from for-profit to nonprofit status, as well as the effect of hospital conversions on hospital profitability, efficiency, staffing, and the probability of closure. DATA SOURCES: The Health Care Financing Administration's Medicare Cost Reports and the American Hospital Association's Annual Survey of Hospitals. STUDY DESIGN: Bivariate and multivariate analyses comparing conversion hospitals to nonconversion hospitals over time were conducted. DATA EXTRACTION METHODS: The study sample consisted of all private acute care hospital conversions that occurred from 1989 through 1992. PRINCIPAL FINDINGS: Hospitals that converted had significantly lower profit margins prior to converting than did nonconversion hospitals. This was particularly true for nonprofit to for-profit conversions. After converting, both nonprofit and for-profit hospitals significantly improved their profitability. Nonprofit to for-profit hospital conversions were associated with a decrease in the ratio of staff to patients. No association was found between for-profit to nonprofit conversion and staff-to-patient ratios. The difference seems partially attributed to the fact that nonprofit hospitals that converted had higher staff ratios than the industry average. For-profit to nonprofit hospital conversions were associated with an increase in the ratio of registered nurses to patients and administrators to patients, despite the fact that nonprofit and for-profit hospitals did not differ in these ratios. CONCLUSIONS: The improvement in financial performance following hospital conversions may be a benefit to the community that policymakers want to consider when regulating hospital conversions. (+info)
Managing hospitals in turbulent times: do organizational changes improve hospital survival?
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OBJECTIVE: To examine (1) the degree to which organizational changes affected hospital survival; (2) whether core and peripheral organizational changes affected hospital survival differently; and (3) how simultaneous organizational changes affected hospital survival. DATA SOURCES: AHA Hospital Surveys, the Area Resource File, and the AHA Hospital Guides, Part B: Multihospital Systems. STUDY DESIGN: The study employed a longitudinal panel design. We followed changes in all community hospitals in the continental United States from 1981 through 1994. The dependent variable, hospital closure, was examined as a function of multiple changes in a hospital's core and peripheral structures as well as the hospital's organizational and environmental characteristics. Cox regression models were used to test the expectations that core changes increased closure risk while peripheral changes decreased such risk, and that simultaneous core and peripheral changes would lead to higher risk of closure. PRINCIPAL FINDINGS: Results indicated more peripheral than core changes in community hospitals. Overall, findings contradicted our expectations. Change in specialty, a core change, was beneficial for hospitals, because it reduced closure risk. The two most frequent peripheral changes, downsizing and leadership change, were positively associated with closure. Simultaneous organizational changes displayed a similar pattern: multiple core changes reduced closure risk, while multiple peripheral changes increased the risk. These patterns held regardless of the level of uncertainty in hospital environments. CONCLUSIONS: Organizational changes are not all beneficial for hospitals, suggesting that hospital leaders should be both cautious and selective in their efforts to turn their hospitals around. (+info)
A case study of hospital closure and centralization of coronary revascularization procedures.
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BACKGROUND: Despite nation-wide efforts to reduce health care costs through hospital closures and centralization of services, little is known about the impact of such actions. We conducted this study to determine the effect of a hospital closure in Calgary and the resultant centralization of coronary revascularization procedures from 2 facilities to a single location. METHODS: Administrative data were used to identify patients who underwent coronary artery bypass grafting (CABG), including those who had combined CABG and valve procedures, and patients who underwent percutaneous transluminal angioplasty (PTCA) in the Calgary Regional Health Authority from July 1994 to March 1998. This period represents the 21 months preceding and the 24 months following the March 1996 hospital closure. Measures, including mean number of discharges, length of hospital stay, burden of comorbidity and in-hospital death rates, were compared before and after the hospital closure for CABG and PTCA patients. Multivariate analyses were used to derive risk-adjustment models to control for sociodemographic variables and comorbidity. RESULTS: The number of patients undergoing CABG was higher in the year following than in the year preceding the hospital closure (51.6 per 100,000 before v. 67.3 per 100,000 after the closure); the same was true for the number of patients undergoing PTCA (129.8 v. 143.6 per 100,000). The burden of comorbidity was significantly higher after than before the closure, both for CABG patients (comorbidity index 1.3 before v. 1.5 after closure, p < 0.001) and for PTCA patients (comorbidity index 1.0 before v. 1.1 after, p = 0.04). After adjustment for comorbidity, the mean length of hospital stay was significantly lower after than before the closure for CABG patients (by 1.3 days) and for PTCA patients (by 1.0 days). The adjusted rates of death were slightly lower after than before the closure in the CABG group. The adjusted rates of death or CABG in the PTCA group did not differ significantly between the 2 periods. INTERPRETATION: Hospital closure and the centralization of coronary revascularization procedures in Calgary was associated with increased population rates of procedures being performed, on sicker patients, with shorter hospital stays, and, for CABG patients, a trend toward more favourable short-term outcomes. Our findings indicate that controversial changes to the structure of the health care system can occur without loss of efficiency and reduction in quality of care. (+info)
The financial health of California hospitals: a looming crisis.
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This paper summarizes a Shattuck Hammond Partners study, released in late 2000, that found marked erosion in California hospitals' financial health. The study examined the revenue and expense dynamics that contributed to this erosion and explored future challenges, some of which are unique to California's regulatory environment, in the context of the hospital industry's current financial performance. The study concluded that California hospitals face a potential crisis--defined as the potential nonviability of a large portion of its hospital infrastructure--and explored the policy questions and implications of this situation. (+info)
Nursing home closures: effects on capacity and reasons for closure.
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OBJECTIVES: to identify the rate of closure of nursing homes for older people, the types of homes closing and the reasons for closure. DESIGN: mixed method study including a census and telephone survey of registration and inspection units and interviews with independent providers. PARTICIPANTS: 81 of 96 health authority and joint registration and inspection unit managers in England completed the census and 39 managers participated in a further telephone survey. Twenty-five independent providers were interviewed. RESULTS: closures resulted in a net loss of 6% of nursing homes and 4.9% of nursing places during 2000-2001. Smaller homes were more likely to close and were increasingly seen as unviable. The majority of closed homes were reported to have provided good quality care. Shortages of nursing staff were of widespread concern. The dominant combination of factors identified by providers was low fees and concerns about the cost implications of the new care standards. Changes in demand were reflected in the placement of high dependency residents in residential rather than nursing homes. CONCLUSIONS: in the absence of policy interventions capacity will continue to reduce, with smaller homes most likely to disappear. There is an urgent need to address the supply and efficient use of nursing staff skills in care homes. While fee levels are the primary concern the effect of the proposed care standards was clearly having an effect. Even with subsequent amendment to these standards, unless authorities use capacity funding to raise fees and improve expectations, providers are likely to continue to exit the market. (+info)
The 'quiet' crisis in mental health services.
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The failure of insurers and managed care organizations to reimburse providers of mental health services for the costs of care has led to a crisis in access to these services. Using the situation in Massachusetts as a case example, this paper explores the impact of this defunding. Unable to sustain continued losses, hospitals are closing psychiatric units, and outpatient services are contracting or closing altogether. The situation has been compounded by the withdrawal of many practitioners from managed care networks and cuts in public-sector mental health services. Unless purchasers demand effective coverage of mental health treatment, mental health services will likely continue to wither away. (+info)
The TAPS project. 16: Difficult to place, long term psychiatric patients: risk factors for failure to resettle long stay patients in community facilities.
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OBJECTIVE: To identify patients who could not be resettled in the community as part of the closure plans of two psychiatric hospitals and to determine their numbers and risk factors for failure. DESIGN AND SETTING: Prospective study of the closure of Friern and Claybury psychiatric hospitals. PATIENTS: The first third (369) of long stay psychiatric patients to be resettled. OUTCOME MEASURES: Reasons for patients being readmitted to hospital and not leaving the patients' service needs. RESULTS: 22--6% of both hospitals' long stay patients--were not successfully resettled in the community. Eighteen continuing care places per 100,000 of catchment area population seem to be required for this group. Patients whose placements were unsuccessful were usually readmitted because of a deterioration of their mental state and aggressive behaviour, both of which persisted and necessitated their continuing stay in hospital, often in a locked ward. Risk factors associated with failure were a high level of psychosis; a diagnosis of paranoid psychosis; incontinence; and being male. But having a social network, especially a large one, seemed to aid successful placement in the community. CONCLUSION: Rehabilitation efforts should be focused on the characteristics of these patients that put them at risk of failing to succeed in community placements. (+info)
A case report: ethics of a proposed qualitative study of hospital closure in an Australian rural community.
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BACKGROUND: The GP and qualitative researcher use similar patient-centred approaches, but their roles are different. Guidelines for conducting GP research in small communities are limited. I planned a qualitative study about hospital closure in a small rural Australian town where I worked. Few studies have researched community reaction to hospital closure and this process of change. METHODS: I used historical analysis to improve external reliability, and purposeful sampling to develop and pre-test a qualitative semi-structured research instrument. Newspaper articles, minutes and tape recordings of public meetings, annual reports from 1991 to 1997, quality assurance data and interviews with two health professionals were analysed in this process. These sources were coded using content and thematic analysis. Ethical issues arose during early stages of planning. Ethical guidelines and bioethics principles were discussed with colleagues and a member of an ethics committee. I validated my findings with three other community members involved in the hospital closure. RESULTS: Themes of a transition, from resistance to change and divisions between key stake holders, to a need to appreciate the benefits of change emerged in coding material from 1991 to 1997. The principle of non-maleficence outweighed the principle of beneficence in this study. Existing health services could be harmed by examining the process of change after spending time and resources to reconcile community differences. Individuals could be harmed as confidentiality in a small community was difficult to maintain, and discussions about sensitive issues could produce adverse public criticism. The autonomy of participants to give informed consent was complicated by the author providing clinical services in the community, raising concerns about patients feeling an obligation to participate. CONCLUSIONS: A justified case for discontinuing this study was made by the researcher on ethical grounds. Use of bioethical principles and community representatives to validate findings was a useful technique to guide decisions in a small rural community. This discussion has application in planning other small community studies. (+info)