For decades, the debate over for-profit hospitals has been a heated one: do they provide more efficient and cost-effective care, or do they prioritize profits over patient outcomes? Gallup reports that 82% of Americans trust non-profit hospitals, while 61% trust for-profit hospitals. So it seems the general public trusts for-profit hospitals less. The real question is, however, is this mistrust warranted?
Although for-profit hospitals operate in similar ways to non-profit hospitals, they’re tasked with a few unique differences. For-profit hospitals must make a return for their investors, as well as pay taxes (whereas nonprofits must provide community benefits in lieu of paying taxes). According to Andrew Slusser, senior vice president at RCCH HealthCare Partners, “for-profit hospitals generally have to be more cost-efficient because of the financial hurdles they have to clear: sales taxes, property taxes, all the taxes nonprofits don’t have to worry about.” This focus on cost-efficiency usually results in a significant culture-difference. Yvette Doran, the Chief Operating Officer at Saint Thomas Medical Partners, says that “the culture at for-profits is business-driven. The culture at nonprofits is service-driven.” However, does the service-driven mentality held by nonprofits indeed manifest itself in better service?
Many believe that the quality of care at for-profit hospitals is lower than that found at non-profit hospitals, reasoning that the profit motivates doctors and administrators to take on more patients and prioritize moneymaking procedures while discouraging care for uninsured patients and those requiring costly services.
Source: Joe Raedle
Researchers at the University of Illinois recently published a study looking at readmission data from 2012 to 2015 for the common diseases of heart attack, heart failure, coronary artery bypass surgery, pneumonia, chronic obstructive pulmonary disease, and total hip or knee replacement surgery. The study found that patients treated for these conditions at for-profit hospitals were more likely to be readmitted compared to those treated in nonprofit or public hospitals. In addition, hospitals with lower readmission rates than expected were primarily nonprofit and public hospitals.
However, a flurry of studies published in recent years have come to the defense of for-profit hospitals. Since 2010, for-profit hospitals have performed better than non-profit hospitals in the “Top Performer” evaluation carried out by The Joint Commission. In addition, research published by Harvard scientists in 2012 found that for-profit hospitals offered a similar quality of care to non-profit hospitals.
Thus, it seems the case of for-profit hospitals is a complicated one, with many different factors that come together to paint a picture that is not nearly black and white enough to please the players on either side of the argument. The one thing that is black and white, however, is the fact that how hospitals are led and operated must be studied more thoroughly.
Feature Image Source: Gorodenkoff – stock.adobe.com
