Hospital Service Offerings Still Differ Substantially By Ownership Type

Nonprofit, for-profit, and government hospitals are all more likely to offer services when they are relatively profitable than when they are relatively unprofitable. However, for-profit hospitals are considerably more likely than others to provide services based on profitability. After hospital and market characteristics are adjusted for, nonprofit hospitals offer relatively unprofitable services more than for-profit hospitals and less than government hospitals. Profitable services typically exhibit the opposite pattern. For-profit hospitals are also more likely to adopt or discontinue services consistent with changes in service profitability than are nonprofits, which in turn are more likely to do so than government hospitals. These results are similar to those we found before passage of the Affordable Care Act, when many more patients were uninsured. Policy makers and researchers tend to focus on whether nonprofit hospitals provide sufficient free care to justify tax benefits, thereby overlooking the significance of ownership for service provision, which likely has critical health and spending consequences.