Date and Time
April 2, 2004
10:30 AM - 12:00 PM

Availability
Open to the public
No RSVP required

Speaker
Yu-Chu Shen, PhD - Assistant Professor of Economics at the Naval Postgraduate School; Faculty Research Fellow at the National Bureau of Economic Research; CHP/PCOR Adjunct Associate

This research examines the effect of ownership conversions on hospital performance between 1987 and 1998 in areas of staffing, financial performance, capacity, unprofitable care, and patient outcomes. Conversions to for-profit and government ownership both increased the profit margin, the former due to increasing revenue and the latter due to reducing operating costs. Hospitals that converted to for-profit ownership were most aggressive in reducing staff and operating costs relative to other converted hospitals. While hospitals that converted to private ownership (for-profit or not-for-profit) reduced their levels of licensed practical nurses, the new for-profit hospitals also reduced their registered nurse workforce by a substantial amount. Conversion of any kind did not lead to a reduced amount of unprofitable care, but conversion to private ownership increased the probability of the converted hospitals closing their trauma centers. The incidence of adverse patient outcomes (measured by mortality and complication rates of heart attack patients) increased by 7 to 9 percent after hospitals converted to for-profit status, but there was little change in patient outcomes for other forms of ownership conversion. Dr. Shen is a research associate for the Health Policy Center at the Urban Institute in Washington, D.C.