Access, Hospital Ownership, and Competition between For-Profit and Nonprofit Institutions

Abstract

The authors argue that past studies of ownership inadequately control for the ways in which competition alters ownership-related differences. Survey data from 1975, 1980, and 1986 are used to estimate the changing effect of hospital ownership and between-sector competition on access to inpatient psychiatric care over a period when for-profit competition was increasing. Results show that during the noncompetitive period (1975), nonprofit psychiatric hospitals were more willing to admit costly patients. As cross-ownership competition increased, nonprofit hospitals became more willing to admit uninsured and underinsured patients, but they also grew more sensitive to cost of care. For-profit hospitals became more sensitive to the generosity of reimbursement but less sensitive to cost of care.