Hospital ownership and cost and quality of care: is there a dime’s worth of difference?

Sloan, Frank A.; Picone, Gabriel; Taylor, Donald H.; Chou, Shin‐Yi

doi:10.1016/s0167-6296(00)00066-7

Cited by 230 publications

(143 citation statements)

References 17 publications

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“…2 Sloan (2000) summarizes the particular effects present in the hospital context due to moral hazard and the consumer's asymmetric information. This literature is particularly concerned with the effect of ownership on the provision of service quality (Sloan et al 2001, Picone et al 2002, Eggleston et al 2008, but also on the role of competition (Duggan 2002), managerial compensation (Ballou and Weisbrod 2003), and these characteristics combined with the question of what drives nonprofit behavior, more generally (Deneffe and Masson 2002, Horwitz and Nichols 2009, Chang and Jacobson 2011, McClellan and Staiger 2000. The paper most related to ours, both in context and approach, is Chang and Jacobson (2011), which looks at hospitals in California and also uses seismic retrofitting as an exogenous cost shock.…”

Section: Introductionmentioning

confidence: 99%

Cost versus control: Understanding ownership through outsourcing in hospitals

Dalton

Warren

2016

Journal of Health Economics

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For-profit hospitals in California contract out services much more intensely than either private nonprofit or public hospitals. To explain why, we build a model in which the outsourcing decision is a trade-off between net revenues and some non-monetary benefit to the manager, or "bias" in the manner of production. Since nonprofit firms must consume profits under restrictions, they trade off bias and income differently than forprofit firms. This difference is exaggerated in services where the benefits of controlling the details of production are particularly important but minimized when firms are hit with a fixed-cost shock. We test these predictions in a panel of California hospitals, finding evidence for each. These results suggest that a model of public or nonprofit make-or-buy decisions should be more than a simple relabeling of a model derived in the for-profit context. JEL Classification: I11, L24, L33

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Section: Introductionmentioning

confidence: 99%

Cost versus control: Understanding ownership through outsourcing in hospitals

Dalton

Warren

2016

Journal of Health Economics

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“…For a discussion of the distinguishing features of ownership types, see Sloan (2000). However, in the US context these predictions have mostly not been fulfilled (Sloan et al 2001). Regarding cardiac treatment, recent results from Taiwan (Lien et al 2008) suggest that patients admitted to non-profit hospitals received better quality care, as measured by 1-and 12-month mortality rates.…”

Section: Datamentioning

confidence: 99%

Determinants of avoidable deaths from ischemic heart disease in East and West Germany

Schwierz

Wübker

2010

J Public Health

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Objective Within Germany, a significant decrease in avoidable mortality from ischemic heart disease (IHD) has been observed since the early 1990s. The objective of this paper is to identify the specific reasons that have led to the decrease in the number of avoidable deaths from IHD in West and East Germany from 1996 to 2004. Methods We analyzed the mortality rate from IHD of the male population aged less than 65 years on the regional level of German counties over the 1996-2004 period. Methodologically, after adjusting for a number of health structure variables, the socioeconomic structure of each region, and yearly time trends in avoidable mortality, we accounted for unobservable differences among regions by using a fixed-effect estimator. Results Our main result reveals that the number of intracardiac catheter facilities, an important diagnostic tool for IHD, significantly accounts for decreases in avoidable mortality from IHD. This is important, as the modernization of the East German health sector included a considerable catching-up process in the number of IC facilities provided relative to West Germany. ConclusionOur results suggest that the modernization of the East German health sector may have contributed to saving people from premature deaths.

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“…The ownership and teaching status of hospitals are the hospital characteristics most commonly discussed in both the theoretical and empirical literature. A number of studies have shown that hospital ownership can affect the care provided to uninsured patients (Norton and Staiger 1994;Sloan et al 2001). A for-profit hospital may have stronger incentives to maximize cash flows from insured patients than would a nonprofit or government hospital.…”

Section: Hospital Characteristicsmentioning

confidence: 99%

“…A for-profit hospital may have stronger incentives to maximize cash flows from insured patients than would a nonprofit or government hospital. For instance, for-profits have been found to bill more or ''up code'' patient diagnoses (Sloan et al 2001;Silverman and Skinner 2004). Sloan et al (2001) also found that for-profit hospitals were more expensive for the Medicare program than not-for-profit hospitals, although there were no differences in health outcomes by hospital ownership.…”

Section: Hospital Characteristicsmentioning

confidence: 99%

“…For instance, for-profits have been found to bill more or ''up code'' patient diagnoses (Sloan et al 2001;Silverman and Skinner 2004). Sloan et al (2001) also found that for-profit hospitals were more expensive for the Medicare program than not-for-profit hospitals, although there were no differences in health outcomes by hospital ownership. In contrast, government hospitals may have limited capacity to sort patients by insurance status to different quality physicians because government hospitals typically are mandated to provide care to the poor, and thus may have higher percentages of poor patients.…”

Section: Hospital Characteristicsmentioning

confidence: 99%

See 1 more Smart Citation

Physician Quality and Health Care for the Poor and Uninsured

Gardner¹,

Vishwasrao²

2010

INQUIRY

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Adverse health outcomes for uninsured patients have been attributed to their health status and to the quality of treatment received. A question about treatment that remains unexplored is whether physicians treating the uninsured are more likely to have characteristics indicative of lower quality than physicians treating insured patients. Using education, training, experience, and board certification to measure physician quality, we find that uninsured and Medicaid patients are treated by lower-quality physicians both because of the hospitals these patients attend and because of sorting within hospitals. The effects are statistically significant, but small.

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Hospital ownership and cost and quality of care: is there a dime’s worth of difference?

Cited by 230 publications

References 17 publications

Cost versus control: Understanding ownership through outsourcing in hospitals

Cost versus control: Understanding ownership through outsourcing in hospitals

Determinants of avoidable deaths from ischemic heart disease in East and West Germany

Physician Quality and Health Care for the Poor and Uninsured

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