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The effects of for-profit status and system membership on the financial performance of hospitals

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  • Virginia Wilcox-Gok

Abstract

This research examines whether for-profit status or system membership is significantly related to the financial performance of hospitals. Panel data containing 573 observations of Florida hospitals for 1984 through 1987 are used in a fixed-effects regression model. The results indicate that it is system membership rather than forprofit status that is significantly related to better financial performance. For-profit status is unrelated to overall financial performance. System hospitals have higher revenues per admission, but not higher expenditures per admission than independent hospitals. The findings are consistent with the hypothesis that expanding hospital systems target locations and services that are potentially profitable.

Suggested Citation

  • Virginia Wilcox-Gok, 2002. "The effects of for-profit status and system membership on the financial performance of hospitals," Applied Economics, Taylor & Francis Journals, vol. 34(4), pages 479-489.
    • Handle: RePEc:taf:applec:v:34:y:2002:i:4:p:479-489
    DOI: 10.1080/00036840110044180
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    Cited by:

    1. Augurzky, Boris & Engel, Dirk & Schmidt, Christoph M. & Schwierz, Christoph, 2009. "Ownership and Financial Performance in the German Hospital Sector," Ruhr Economic Papers 123, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    2. repec:zbw:rwidps:0054 is not listed on IDEAS
    3. repec:zbw:rwirep:0123 is not listed on IDEAS
    4. Kathleen A. Carroll & Jane E. Ruseski, 2011. "Modeling Internal Decision Making Process: An Explanation Of Conflicting Empirical Results On Behavior Of Non‐Profit And For‐Profit Hospitals," Contemporary Economic Policy, Western Economic Association International, vol. 29(4), pages 510-523, October.
    5. Augurzky, Boris & Engel, Dirk & Schwierz, Christoph, 2006. "Who gets the Credit? Determinants of the Probability of Default in the German Hospital Sector," RWI Discussion Papers 54, RWI - Leibniz-Institut für Wirtschaftsforschung.
    6. Boris Augurzky & Dirk Engel & Christoph M. Schmidt & Christoph Schwierz, 2009. "Ownership and Financial Performance in the German Hospital Sector," Ruhr Economic Papers 0123, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    7. Boris Augurzky & Dirk Engel & Christoph Schwierz, 2006. "Who gets the Credit? Determinants of the Probability of Default in the German Hospital Sector," RWI Discussion Papers 0054, Rheinisch-Westfälisches Institut für Wirtschaftsforschung.

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