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Indigent Care As Quid Pro Quo In Hospital Regulation

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  • Gary M. Fournier
  • Ellen S. Campbell

Abstract

Hospitals expend considerable resources each year to provide health care to the poor. Why do some hospitals voluntarily take on a disproportionate burden of this care? Our view is that the burdened hospitals are not simply altruistic. They are indirectly compensated for this expense with legal protections against competition under certificate-ofneed (CON) regulation. We test this hypothesis in a recursive model, explaining which hospitals are likely to win CON approval. The results indicate that, controlling for the endogeneity of indigent care, regulators in Florida systematically awarded licenses to hospitals providing greater amounts of care to the poor. © 1997 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology

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Bibliographic Info

Article provided by MIT Press in its journal The Review of Economics and Statistics.

Volume (Year): 79 (1997)
Issue (Month): 4 (November)
Pages: 669-673

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Handle: RePEc:tpr:restat:v:79:y:1997:i:4:p:669-673

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Cited by:
  1. Guy David, 2009. "The convergence between for-profit and nonprofit hospitals in the United States," International Journal of Health Care Finance and Economics, Springer, Springer, vol. 9(4), pages 403-428, December.
  2. Guy David & Richard Lindrooth & Lorens A. Helmchen & Lawton R. Burns, 2011. "Do Hospitals Cross Subsidize?," NBER Working Papers 17300, National Bureau of Economic Research, Inc.
  3. Núria Mas, 2013. "Responding to financial pressures. The effect of managed care on hospitals’ provision of charity care," International Journal of Health Care Finance and Economics, Springer, Springer, vol. 13(2), pages 95-114, June.

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