This article reports on the results of a survey which investigated the nature of relationships between hospital and multihospital organization-centered factors and background characteristics, and multihospital organization effectiveness. Canonical correlation is employed in analyzing the data. Results and their implications are discussed.

My study examines the effect of regulatory pressures on the earnings management behavior of nonprofit (i.e., tax-exempt) hospitals. Prior research provides evidence that managers of nonprofit hospitals manage reported earnings to a range just above zero profit in order to conform to regulator low or zero profit expectations. I extend this research by investigating how reported performance on another accounting measure important to regulators, (i.e., charity care), further explains the earnings management behavior of nonprofit hospitals. Specifically, I develop theory to predict that nonprofit hospitals use discretionary accruals to manage positive earnings toward regulator low profit expectations less aggressively when reported performance on charity care is higher than regulator expectations. The intuition behind this prediction is that nonprofit hospital managers can benefit from reporting higher earnings (from profit-based compensation and/or enhanced reputations for operational efficiency), however, they must balance this against the costs of regulatory scrutiny. Results are consistent with my prediction. Further, I validate that my results are not alternatively explained by the mechanical relationship of my test variables, the general hospital economic environment, and/or the specific reporting environment of my sample firms. I do so by comparing the earnings management behavior of nonprofit hospitals to that of for-profit hospitals. Overall, results suggest that nonprofit managers strategically manage earnings higher when their firms are less vulnerable to regulator scrutiny of their reported chairy care. As such, my study contributes to the earnings management literature and has policy implications important to regulators, especially given the current U.S. healthcare environment.

Source: Masters Abstracts International, Volume: 46-05, page: 2668. Adviser: Stephanie L. McFall. Includes bibliographical references.

This study uses an institutional theory perspective to examine whether significant changes to the audit work and engagement practices required under the Sarbanes-Oxley Act (SOX) lead to improved audit quality in nonprofit hospitals. Unlike their for-profit counterparts, nonprofit organizations have been subject to audits of internal controls over financial reporting and program compliance for decades under Circular A-133 of the Single Audit Act of 1984, as amended. Circular A-133 audits represent the primary accountability tool over the billions of grant dollars awarded annually by the federal government. Despite the enormity of these awards and the substantial informational effect of the audit reports, prior empirical research suggests that the quality of these audits is problematic. Using the archival data of nonprofit hospital Circular A-133 audits and related hand-collected financial data from IRS Form 990s, bivariate and multivariate analyses are conducted on a cross-sectional sample of 875 audits for 141 nonprofit hospitals with audits during both pre-SOX (2001-2004) and post-SOX (2008-2011) periods. Audit quality is inferred from discretionary accruals (Modified Jones model) and auditor-reported internal control deficiencies (reportable conditions and material weaknesses). The results indicate support for improved audit quality from the pre- to the post-SOX period for all measures of audit quality. The results are different for the measures of audit quality used to examine the association between audit firm size and audit quality. Non-Big 4 audit firms experienced a significant improvement in audit quality when discretionary accruals are used as a proxy for audit quality. Conversely, Big 4 audit firms experienced a significant improvement in audit quality when internal control deficiencies are proxies for audit quality. In the post-SOX period audit firms provide approximately the same level of audit quality regardless of firm size when discretionary accruals or material weaknesses are the proxy for audit quality. When reportable conditions are the proxy, non-Big 4 firms have higher audit quality than Big 4 firms post-SOX. Client characteristics, specifically hospital size and the interaction of leverage and risk, are attributable to differences in post-SOX audit quality. Finally, the study fails to support the hypothesis that large audit firms self-select low risk clients.

Indiana University-Purdue University Indianapolis (IUPUI) / The study of the nonprofit sector has traditionally focused on nonprofit organizations as recipients of charity. A perspective that has been relatively neglected is that of nonprofit organizations as not only recipients but also as donors of charitable resources. This dissertation explores the phenomenon of philanthropic behavior of nonprofit organizations, using studies of the contributions and community health programs of nonprofit hospitals in Indiana as an example. Philanthropic behavior is defined as actions and programs initiated by a nonprofit organization to meet additional community needs – beyond its primary mission or services. It presents the hypothesis that such activities are undertaken for reasons similar to for-profit organizations – and have comparable organizational benefits. The studies reported in the dissertation show a wide variation in reporting such activities as well as of the organizational structures in place to manage such behavior. This variation is seen even in seemingly similar hospitals such as religious hospitals within an identified system. The dissertation discovers that while nonprofit organizations may engage in philanthropic behavior, these practices go largely unrecognized. Because the actions are not systematically noted or recorded, some very significant residual benefits that nonprofits provide for their defined communities are also unrecognized. It also finds that when these activities are evident, they are driven more by the professional values and actions of individual employees than by organizational policies. The dissertation concludes that drawing conclusions from this study of the data on Indiana hospitals – both from state reports and the IRS Form 990s – is difficult. There is an inconsistency between the two databases as well as within each of the datasets that makes any specific conclusions as to the relative values of different hospitals or to standards is suspect. It notes that while the revised Form 990 should help in overall transparency, the reporting of areas such as health education and donations will most probably continue to be inconsistent. This inconsistency makes the information difficult to use as either an evaluation tool or as policy to encourage community-serving behavior.

This study concerns the general question, "What has been the impact of collective bargaining representation elections on nonprofit hospitals in Texas?" The means of answering this question involved a study of wages and attitudes of nonprofessional employees in both hospitals where such elections occurred and hospitals where no such elections had occurred in the State of Texas. An overview of the development of hospitals and the union movement in hospitals are presented as background information for this study. Further, a brief discourse on attitude development and attitude measurement is provided as theoretical foundational material. A researcher-constructed questionnaire was devised, tested, and administered to employees of the subject hospitals. There were 176 useable returns from employees where no union representation election occurred and 176 useable returns from employees where union representation elections occurred.