Managing health services organizations with an educational mission: the case of Canada

Teaching hospitals represent a major segment of the Canadian health system, accounting for a disproportionate number of beds, patient days, and separations. Thus, although only six percent of hospitals are classified as teaching hospitals, they are responsible for about 36 percent of total hospital operating expenses. While affiliation with a medical school presents unique opportunities for the teaching hospital and increases its prestige, there are clear costs associated with affiliation. Administrators have less control over resource allocation decisions, including the types of teaching programs offered. Teaching hospitals cannot unilaterally design their own teaching programs around specialties and subspecialties of their own choosing; decisions related to teaching programs have a direct impact on the services provided by the hospital and may negatively affect the hospital's ability to fulfill its patient care mission. As education budgets are constrained, teaching hospitals are expected to assume outstanding teaching-related expenses. Teaching hospitals are also expected to shift some of their teaching to alternative settings, such as the community. Thus, teaching hospital administrators will require a strong background in finance as well as negotiation and political skills.