BackgroundIn fiscal year 1990, administration accounted for 24.8 percent of total hospital costs in the United States -nearly twice the share in Canada. Studies from the 1970s and early 1980s found high costs, especially for administration, at for-profit hospitals.
MethodsWe calculated administrative costs for 6227 nonfederal hospitals and the total costs of inpatient care for 5201 acute care hospitals in the United States for fiscal year 1994 on the basis of data the hospitals submitted to Medicare. We analyzed similar data for fiscal year 1990. Using multivariate analysis, we assessed the effect of hospital ownership (private not-for-profit, for-profit, and public) on administrative costs, controlling for hospital type, census region, hospital size, and the proportion of revenues derived from outpatient services. We adjusted inpatient costs for local wage levels, hospitals' reporting periods, and case mix. I the United States . On page 773, the sentence that begins eight lines from the bottom of the left-hand column should have read,``Scant recent data on acute care hospitals, mostly from Florida, suggest that the pattern of higher profits and reduced staffing at for-profit hospitals has persisted 20,21 ; by some technical measures of efficiency, they are even less efficient than not-for-profit hospitals,´´not``even less efficient then they were,´´as printed. We regret the error.
N Engl