Do Patient Perceptions Vary With Ownership Status? A Study of Nonprofit, For-Profit, and Public Hospital Patients

Abstract

Recent research indicates that consumers associate nonprofit organizations mainly with the trait “warmth,” whereas for-profit organizations are perceived as being “competent.” Trustworthiness is another dimension of consumer perceptions of nonprofit organizations. This article attempts to combine two strands of research: Aaker, Vohs, and Mogilner’s research on perceptions of warmth and competence and Handy et al.’s and Schlesinger, Mitchell, and Gray’s research on individuals’ perceptions of trustworthiness in nonprofits. Our study indicates that “warmth,” “trustworthiness,” and “competence” are distinct dimensions of patient perceptions of hospitals. Perceptions of these traits vary across different manifestations of ownership status. Nonprofit hospitals are perceived as more trustworthy and warm but less competent than their for-profit competitors. With nonurgent care, analysis shows that only trustworthiness and competence influence patients’ hospital evaluations. Nonprofit hospitals should try to make their ownership status public as well as to alleviate detrimental deviations of perceived competence from actual competence.

Does CSR Matter for Nonprofit Organizations? Testing the Link Between CSR Performance and Trustworthiness in the Nonprofit Versus For-Profit Domain

“…Stereotypic beliefs and the associated ''category-based expectancies'' (Jones and McGillis 1976) also exist for nonprofit organizations versus for-profit organizations (e.g., Aaker et al 2010;Drevs et al 2014;Schlesinger et al 2004). Usually, people believe that nonprofit organizations uphold a higher level of moral standards than their for-profit counterparts (e.g., Jeavons 1992;Smith and Richmond 2007).…”

“…In a study on government contracting in the U.S., Witesman and Fernandez (2012) present some evidence that public officials have a greater trust in nonprofit than in for-profit partners. Another example is offered by Drevs et al (2014) and Schlesinger et al (2004) who find that Germans and Americans, respectively, regard nonprofit health care providers as more trustworthy than their for-profit counterparts. However, Schlesinger et al (2004) point out that despite extensive theorizing on the notion that nonprofit organizations are perceived as more trustworthy than for-profit organizations, empirical work on the issue is scarce.…”

“…Trustworthiness is one of the most important assets of for-profit and nonprofit organizations as it constitutes a source of competitive advantage (e.g., Barney and Hansen 1994;Caldwell and Hansen 2010 for for-profit organizations;Bekkers 2003;Drevs et al 2014 for nonprofit organizations). Trust has been termed ''an important lubricant of a social system'' (Arrow 1974, p. 23) that improves the efficiency of economic exchanges because it enables organizations to build valuable relationships with their stakeholders (e.g., Harrison et al 2010;Morgan and Hunt 1994).…”

Nonprofit Pay in a Competitive Market: Wage Penalty or Premium?

“…Because nonprofit hospitals cannot redistribute profits to shareholders, nurses may view them more favorably and be more willing to work for them. Drevs, Tscheunlin, and Lindenmeier (2014) find that patients view German nonprofit hospitals as more trustworthy and warm although, surprisingly, less competent than for-profit hospitals.…”

Quasi-Governmental Organizations at the Local Level: Publicly-Appointed Directors Leading Nonprofit Organizations

“…Calling an organization a "private nonprofit organization" may be perceived as a way of obtaining the trust of those who are skeptical of the government (Van Slyke and Roch 2004;Drevs, Tscheulin, and Lindenmeier 2014). The government gets the best of both worlds: benefiting from the warm glow that people feel towards the nonprofit sector while still maintaining some measure of electoral accountability for the organization.…”