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Comparing Hospital Quality at For-Profit and Not-for-Profit Hospitals

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Author Info
Mark McClellan
Douglas Staiger
Abstract

Do not-for-profit hospitals provide better care than for-profit hospitals? We compare patient outcomes in for-profit and not-for-profit hospitals between 1984 and 1994 using a new method for estimating differences across hospitals that yields far more accurate estimates of hospital quality than previously available. We find that, on average, for-profit hospitals have higher mortality among elderly patients with heart disease, and that this difference has grown over the last decade. However, much of the difference appears to be associated with the location of for-profit hospitals. Within specific markets, for-profit ownership appears if anything to be associated with better quality care. Moreover, the small average difference in mortality between for-profit and not-for-profit hospitals masks an enormous amount of variation in mortality within each of these ownership types. Overall, these results suggest that factors other than for-profit status per se may be the main determinants of quality of care in hospitals.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 7324.

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Date of creation: Aug 1999
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Handle: RePEc:nbr:nberwo:7324

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Find related papers by JEL classification:
I10 - Health, Education, and Welfare - - Health - - - General
L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Edward C. Norton & Douglas O. Staiger, 1994. "How Hospital Ownership Affects Access to Care for the Uninsured," RAND Journal of Economics, The RAND Corporation, vol. 25(1), pages 171-185, Spring. [Downloadable!] (restricted)
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  1. Barbara A. Mark & David W. Harless & Michael McCue, 2005. "The impact of HMO penetration on the relationship between nurse staffing and quality," Health Economics, John Wiley & Sons, Ltd., vol. 14(7), pages 737-753. [Downloadable!]
  2. Paul H. Jensen & Elizabeth Webster & Julia Witt, 2007. "Hospital Type and Patient Outcomes: An Empirical Examination Using AMI Re-admission and Mortality Records," Melbourne Institute Working Paper Series wp2007n31, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne. [Downloadable!]
  3. John Geweke & Gautam Gowrisankaran & Robert J. Town, 2001. "Bayesian Inference for Hospital Quality in a Selection Model," NBER Working Papers 8497, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  4. Gillian Currie & Cam Donaldson & Mingshan Lu, 2003. "What Does Canada Profit from the For-Profit Debate on Health Care?," Canadian Public Policy, University of Toronto Press, vol. 29(2), pages 227-251, June. [Downloadable!] (restricted)
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