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Hospital boards and the decision to renew the full service management contract
Insights
Hospital boards are satisfied with full-service management contracts, but this satisfaction doesn't link to better hospital performance. Board renewal intentions may stem from dependence, not objective improvements.
Area of Science:
- Healthcare Management
- Hospital Administration
- Organizational Behavior
Background:
- Previous research has not clearly linked full-service management contracts to improved hospital performance.
- Hospital board members report high satisfaction with these management arrangements.
Purpose of the Study:
- To survey board members in contract-managed hospitals regarding their satisfaction with management contracts.
- To investigate the relationship between board member satisfaction, hospital performance, and contract renewal intentions.
Main Methods:
- Survey of hospital board members in contract-managed facilities.
- Analysis of satisfaction levels and intentions to renew contracts.
- Exploration of potential influences on board perception and renewal decisions.
Main Results:
- A strong pattern of board member satisfaction with contract management was confirmed.
- Board satisfaction and renewal intentions were not correlated with objective improvements in hospital performance.
- Factors like retrospective rationality and market dependence may influence renewal decisions.
Conclusions:
- Hospital board satisfaction with full-service management contracts is high but not tied to performance metrics.
- Renewal intentions may be driven by perceived dependence on contractors and market limitations rather than objective performance gains.
Abstract:
Precious research has been unable to establish a clear association between "full service" management contracts and improvements in hospital performance, but it has shown that hospital board members are highly satisfied with the arrangement. Presented here are findings from a recent survey of board members in contract-managed hospitals that confirm a strong and consistent pattern of board member satisfaction with contract management. However, it is argued that board satisfaction and intentions to renew cannot be explained by improvements in objective measures of hospital performance. It is further suggested that board perception may be influenced by retrospective rationality and that intentions to renew may result room growing dependence on the contractor and an imperfect market for substitutes.