Influential variables in the profitability of hospital companies

Abstract

Purpose: This study attempts to evidence the economic and financial health of Spanish hospital companies in the period [2008][2009][2010][2011][2012][2013][2014][2015] and discover the variables that explain their profitability for survival and the opportune performance of their assets during a period of technological revolution and austerity. Design/methodology:The study methodology consists of the short and long-term financial analysis of the companies in the study sample during the period 2008-2015, together with analysis is of their economic state, equity and treasury. To add value to the research, the profitability of the hospital companies has been explained in terms of the following independent variables: short-term solvency, debt, business size, legal form, GDP per capita, population density of and indicators of Corporate Social Responsibility. Findings:In the analyzed period, the economic and financial health of hospital companies is characterized by acceptable liquidity and indebtedness that significantly influence its profitability; this is accompanied by good financial and expenditure management, though it is necessary to improve the management of assets. Research limitations/implications:It was not possible to obtain data for 2016, as it was not available in the database used (SABI). These data would have been useful to evaluate the changes in trends that are taking place in the health sector due to the technological revolution and economic policies affecting it. Practical implications:The health sector is one of the pillars on which society is based, and therefore knowing detailed economic and financial information allows us to make appropriate decisions, both on the hospital level and in terms of the economic policies of governments. Social implications:This study provides evidence of the financially relevant indicators that healthcare companies must control for their survival and to provide proper service to society in general. The research also identifies non-financial variables that contribute to improving the profitability of hospital companies, while also having a good impact on society. Originality/value:To indicate financial and non-financial measures to improve the profitability of hospital companies at a time of technological innovation and austerity.

The Influence of Liquidity and Solvency on Performance within the Healthcare Industry: Evidence from Publicly Listed Companies

“…Creixans-Tenas and Arimany-Serrat [25] studied the factors driving performance levels of 80 Spanish healthcare providers during the period 2008-2015. The independent variables were current liquidity ratio, debt to equity ratio, business size, legal form, GDP per capita, population density, and corporate social responsibility indicators.…”

Corporate social responsibility and financial profile of Spanish private hospitals

“…As hospitals are responsible organizations, they must consider the economic, social and environmental dimensions of CSR (Rodríguez et al., 2017; Rodríguez-Cala et al., 2015). Some authors, such as Creixans-Tenas and Arimany-Serrat (2018), define CSR tools as non-financial indicators and indicate that studies of hospitals that analyse non-financial information as well as financial indicators provide more added value to the correct diagnosis of economic and financial health. CSR must be aligned with hospital companies’ strategy and objectives and balance financial, environmental and social aspects (Lemme, 2010; Marrewijk, 2003).…”

“…However, most empirical studies reject this view (García-Castro et al., 2010; Ortlitzky et al., 2003) and suggest that there is a positive relationship between CSR and economic and financial outcomes (Creixans-Tenas and Arimany-Serrat, 2018; Conesa et al., 2016; Wang et al., 2015a; Gallardo-Vázquez and Sánchez-Hernández, 2014; Hammann et al., 2009). Specifically, it appears that companies can increase their economic performance through the application of CSR actions and policies (Chang, 2009).…”

“…(2015)SolvencyLee (2015); García-Sánchez et al. (2013)IndebtednessAECA (2018)Return on assets (ROA)Creixans-Tenas and Arimany-Serrat (2018); Conesa et al. (2016); González et al.…”

Does the Ownership Affect the Financial Performance of the Hospital? The Example of Poland

“…Miszczyńska confirmed based on public hospitals in Łódź the influence of the founding body on the debt [12]. In a study by Creixans-Tenas and Arimany-Serrat, the financial condition of hospital companies was characterized by acceptable liquidity and debt, which significantly affected its profitability [13]. Upadhyay and Smith examined the positive relationship between traditional liquidity ratios and the cash conversion cycle.…”