This paper examines the theoretical and empirical differences between the behavior
of nonprofit and for-profit hospitals. Considerations are extended to include the
possibility of collusion when hospitals make strategic choices. The operating
objectives of the firms take into account price, quantity, and quality. Defining the
quality of hospital care is discussed and applied to the empirical work. The model
predicts nonprofit hospitals will provide a higher level of quality and a lower price
than for-profit hospitals. Theoretically, under a collusive outcome for nonprofits,
price will increase but the change in quality is indeterminate relative to a
competitive, non-collusive outcome. The empirical section offers evidence of
differences between nonprofit and for-profit hospital behavior. Nonprofit hospitals
do provide higher quality and a lower price when compared to their for-profit
rivals. It seems the competitive forces extend to the area of quality. There is
evidence that increased competition between nonprofits fosters quality competition.
From the for-profit perspective, quality competition appears to be provoked in
markets where the for-profit competes more directly against nonprofits. This paper
provides theoretical and empirical analyses of hospital interactions and how these
interactions change depending upon the type of control. / Graduation date: 2001
| Identifer | oai:union.ndltd.org:ORGSU/oai:ir.library.oregonstate.edu:1957/32779 |
| Date | 19 June 2000 |
| Creators | Dickerson, John Fielden |
| Contributors | Connolly, Laura S. |
| Source Sets | Oregon State University |
| Language | en_US |
| Detected Language | English |
| Type | Thesis/Dissertation |
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