For-profit hospitals have thrived because of generous public reimbursement schemes, not greater efficiency: a multi-country case study

Jeurissen, Patrick P.T., Kruse, Florien M., Busse, Reinhard, Himmelstein, David U., Mossialos, Elias ORCID: 0000-0001-8664-9297 and Woolhandler, Steffie (2021) For-profit hospitals have thrived because of generous public reimbursement schemes, not greater efficiency: a multi-country case study. International Journal of Health Services, 51 (1). 67 - 89. ISSN 0020-7314

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Abstract

For-profit hospitals’ market share has increased in many nations over recent decades. Previous studies suggest that their growth is not attributable to superior performance on access, quality of care, or efficiency. We analyzed other factors that we hypothesized may contribute to the increasing role of for-profit hospitals. We studied the historical development of the for-profit hospital sector across 4 nations with contrasting trends in for-profit hospital market share: the United States, the United Kingdom, Germany, and the Netherlands. We focused on 3 factors that we believed might help explain why the role of for-profits grew in some nations but not in others: (1) the treatment of for-profits by public reimbursement plans, (2) physicians’ financial interests, and (3) the effect of the political environment. We conclude that access to subsidies and reimbursement under favorable terms from public health care payors is an important factor in the rise of for-profit hospitals. Arrangements that aligned financial incentives of physicians with the interests of for-profit hospitals were important in stimulating for-profit growth in an earlier era, but they play little role at present. Remarkably, the environment for for-profit ownership seems to have been largely immune to political shifts.

Item Type:	Article
Official URL:	https://journals.sagepub.com/home/joh
Additional Information:	© 2020 The Authors
Divisions:	Health Policy
Subjects:	R Medicine > RA Public aspects of medicine
Date Deposited:	05 Nov 2020 17:18
Last Modified:	17 Apr 2024 03:06
URI:	http://eprints.lse.ac.uk/id/eprint/107147

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