Nonprofit to for-profit conversions by hospitals, health insurers, and health plans

Conversion of hospitals, health insurers, and health plans from nonprofit to for-profit ownership has become a focus of national debate. The author examines why nonprofit ownership has been dominant in the US health system and assesses the strength of the argument that nonprofits provide community benefits that would be threatened by for-profit conversion. The author concludes that many of the specific community benefits offered by nonprofits, such as care for the poor, could be maintained or replaced by adequate funding of public programs and that quality and fairness in treatment can be better assured through clear standards of care and adequate monitoring systems. As health care becomes increasingly commercialized, the most difficult parts of nonprofits' historic mission to preserve are the community orientation, leadership role, and innovation that nonprofit hospitals and health plans have provided out of their commitment to a community beyond those to whom they sell services.     

'Profit' variability in for-profit and not-for-profit hospitals

This paper proposes two tests of the hypothesis that not-for-profit hospitals (NFPs) behave differently than for-profit hospitals. The profit variability test states that the profits of an NFP will be less variable over time than profits of a for-profit hospital if the NFP maximizes utility subject to a profit constraint. The second test examines whether NFP profits respond less to change in exogenous factors, such as Medicare reimbursement rates, than profits of for-profit hospitals. Both tests, performed on panel data from 1983 to 1988, support the hypothesis that NFPs behave differently than for-profit hospitals.     

The economics of for-profit and not-for-profit hospitals

This paper examines the economics of for-profit and not-for-profit hospitals through the prism of capital acquisitions. The exercise suggests that of two hospitals that are equally efficient in producing health care, the for-profit hospital would have to charge higher prices than the not-for-profit hospital would, to break even on capital acquisitions. The reasons for this divergence are (1) the typically higher cost of equity capital that for-profit hospitals face; and (2) the income taxes they must pay. The paper recommends holding tax-exempt hospitals more formally accountable for the social obligation they shoulder, in return for their tax preference.     

Nontraditional services provided by nonprofit and for-profit hospitals: implications for community health

In part because of reimbursement changes in the 1980s, hospitals became involved in health promotion and disease prevention activities often to attract patients. Today, these services may have an effect on the burden of disease and on illness prevention in some communities. Given the changes anticipated in healthcare delivery, assessing the scope of these services and integrating them with other private-public efforts is of utmost importance. Here we use a 1993 survey of all 4,977 private medical and surgical hospitals in the United States to determine the scope of disease prevention, health enhancement, and palliative services provided by facility type, geographic location, and institutional ownership. We found that church-operated and other nonprofit hospitals appear to provide a spectrum of palliative and preventive health services both for their patients and those in the local community. Given their apparent scope, these services could have an effect on the burden of disease and on illness prevention in many communities. With major changes anticipated in future healthcare delivery and the recent failures reported for many community health intervention programs, healthcare administrators need to focus on ways to integrate their services with other private and public health efforts. If this could be achieved, then private hospitals could be more successful in serving their local communities and in enhancing the public's health in the new century. This article outlines several basic steps to assist administrators in achieving these goals.     

Efficiency determinants and capacity issues in Brazilian for-profit hospitals

This paper reports on the use of different approaches for assessing efficiency of a sample of major Brazilian for-profit hospitals. Starting out with the bootstrapping technique, several DEA estimates were generated, allowing the use of confidence intervals and bias correction in central estimates to test for significant differences in efficiency levels and input-decreasing/output-increasing potentials. The findings indicate that efficiency is mixed in Brazilian for-profit hospitals. Opportunities for accommodating future demand appear to be scarce and strongly dependent on particular conditions related to the accreditation and specialization of a given hospital.     

Social work in a health centre

For the last six years social workers have been attached to a health centre in Croydon, Surrey, from the General Practice Research Unit of the Institute of Psychiatry, University of London. Jennifer Winny and Andrée Rushton, research social workers, describe the pattern of relationships that has developed.     

Measuring community benefits provided by for-profit and nonprofit hospitals

Nonprofit hospitals are expected to provide benefits to their community in return for being exempt from most taxes. In this paper we develop a new method of identifying activities that should qualify as community benefits and of determining a benchmark for the amount of community benefits a nonprofit hospital should be expected to provide. We then compare estimates of nonprofits' current level of community benefits with our benchmark and show that actual provision appears to fall short. Either nonprofit hospitals as a group ought to provide more community benefits, or they are performing activities that cannot be measured. In either case, better measurement and accounting of community benefits would improve public policy.     

营利性医院绩效评价指标体系的构建

从产权理论的角度并结合现实情况阐明营利性医院发展的必然性;分析了营利性医院社会效益与经济效益的内在统一性,明确了营利性医院的经营目的;根据营利性医院的特点,运用平衡计分卡的绩效管理方法 ,提出了营利性医院绩效评价指标体系的构建过程,即确定营利性医院的经营目的 在财务、患者、流程和学习方面的绩效指标以及指标间的逻辑关系,并将这一绩效评价指标体系纵向拓展到医院的科室、员工层面,从而形成完整的绩效评价指标体系.     

Social work in the health field.

Health care delivery systems are under careful and systematic scrutiny. Particular concerns are the availability and access of health care to those in the lower and middle income groups and the escalating costs of health care which until quite recently have exceeded annual inflationary rates of increase. Efforts in social work in the health field have reflected these developments. Programmatic trends in health and social work now emphasize ambulatory care and are reflected in the concept of primary care medicine. Deinstitutionalization as a preferred program for patients is under review with particular emphas -is on providing adequate supportive services to maintain patients in a home care environment. Social work is a major discipline contributing to these programs through appropriate interventive measures. Moreover, the role of the social worker, because of involvement with front line community activities, is particularly suited to make a substantial contribution to this trend.     

The convergence between for-profit and nonprofit hospitals in the United States

This paper proposes a novel model of the hospital industry in the United States in which firms in effect choose their ownership type and the regulatory and tax regimes under which they must function. Accordingly, I develop a model in which firms have identical objectives but differ in their ability to benefit from a given ownership form. Changes in the economic environment alter firms’ incentives to maintain a given ownership type. This in turn induces firms to modify their capacity and encourages some firms to switch ownership type. One implication of this model is that changes in the economic environment that have occurred since 1960 imply that the optimal size of those firms which choose to be for profit should more closely approximate the optimal size of firms which choose to be nonprofit. Hospital level data indicate that this size convergence has indeed occurred. In 1960, U.S. nonprofit hospitals maintained on average more than three times as many beds per hospital as their for-profit counterparts; following a monotonic decline in relative size, by 2000, the average nonprofit hospital was only 32% larger than the typical for-profit hospital. Declining roles of government hospitals, population growth, suburbanization, and increasing government intervention in the healthcare market help explain the convergence in size. Analysis of data at the state and Metropolitan Statistical Area (MSA) levels is consistent with the principal theoretical predictions.     

Social work and health restructuring in Canada and Finland

The health care systems in Canada and Finland are currently in the process of restructuring. Responsibility for care has increasingly shifted to ill persons themselves and to their families and friends. Reduced hospital stays, service privatization and user fees have been implemented to some degree in both countries. These changes are reverberating throughout Finnish and Canadian societies, affecting not only users of health care but also the labour force in health workplaces. Health social workers, at the front line with clients, have experienced new issues which have impacted on their practice with ill persons and their families. In an environment of health care restructuring, they have needed to draw upon their repertoires of knowledge, skills and community networks in order to respond. At the same time, social workers noted that there is a leaner package of health and social service benefits to support patients and families. Social workers have tried to adapt and find new opportunities to practice social work in the changed environment. This small study, initially conducted as a pilot for a larger study, compared the experiences of social workers in Canada and Finland and the perceived impacts of health restructuring on their clients. The findings, seen within the context of changing societal and institutional environments, can help us to better understand some of the impacts of health restructuring on social work and social workers in hospitals and local health centres. Indirectly and directly, these changes also affect clients in the health care system, those whose needs remain uppermost in the delivery of social work services.     

城市医院支援农村卫生工作初探

实施城市医院对口支援农村卫生工作既是国家卫生发展的职能需要,更是建立健全社会公共卫生服务体系的重要举措。该文指出城市医院对口支援农村卫生工作的意义,针对支援工作中存在的问题提出建议与对策。     

Growth of for-profit health care institutions

In a policy statement adopted by its Governing Council on 16 November 1983, the American Public Health Association (APHA) expresses its opposition to the growth of for-profit health care institutions. APHA reiterates its support for a comprehensive national health service and for interim measures leading in that direction. The statement calls upon Congress and the Department of Health and Human Services to investigate the social impact and monitor the growth of for-profit health care institutions.