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Who really profits from not-for-profits?
1Center for Health Services Education and Research, St. Louis University Medical Center, MO 63104.
Health Services Research
|June 1, 1990
Summary
Not-for-profit hospitals provide greater societal benefits, including services and access to care, than for-profit hospitals. Further study is needed before changing public policy on not-for-profit hospital subsidies.
Area of Science:
- Health Services Research
- Nonprofit Management
- Healthcare Economics
Background:
- A 1987 Harvard Business Review article questioned whether not-for-profit hospitals offered greater societal benefits than for-profit hospitals.
- The previous study's findings raised questions about the justification for social subsidies provided to not-for-profit healthcare organizations.
Purpose of the Study:
- To empirically re-examine the societal contributions of not-for-profit versus for-profit hospitals.
- To address the question: "Who profits from nonprofits?"
Main Methods:
- Utilized hospital data from 1982, the same period as the original study.
- Employed discriminant analysis on a larger dataset, encompassing both system and nonsystem hospitals.
Main Results:
- Not-for-profit hospitals demonstrated greater social benefit delivery in areas such as service provision, patient access to care, and professional education involvement.
- Consistent with prior research, for-profit hospitals exhibited potentially higher operational efficiency.
Conclusions:
- Findings suggest not-for-profit hospitals contribute more significantly to societal well-being than for-profit entities.
- Public policy decisions regarding subsidies for not-for-profit hospitals require comprehensive study and careful deliberation.
Keywords:
Health Care and Public Health