For-Profit Hospitals Out of Business? Financial Sustainability During the COVID-19 Epidemic Emergency Response

This perspective argues that for-profit hospitals will be heavily affected by epidemic crises, including the current coronavirus disease 2019 (COVID-19) outbreak. Policy-makers should be aware that for-profit hospitals in particular are likely to face financial distress. The suspension of all non-urgent elective surgery and the relegation of market-based mechanisms that determines the allocation and compensation of care puts the financial state of these hospitals at serious risk. We identify three organisational factors that determine which hospitals might be most affected (ie, care-portfolio, size and whether it is private equity [PE]-owned). In addition, we analyse contextual factors that could explain the impact of financial distress among for-profit hospitals on the wider healthcare system

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

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

Independent Treatment Centres Are Not a Guarantee for High Quality and Low Healthcare Prices in The Netherlands – A Study of 5 Elective Surgeries

Background: Independent treatment centres (ITCs) are a growing phenomenon in many healthcare systems. Focus factory theory predicts that ITCs provide high quality healthcare with low prices, through specialisation, high-volume and routine. This study examines if ITC care outperforms general hospital (GH) care within a regulated competition system in the Netherlands, by focusing on differences in healthcare quality and price. Methods: The cross-sectional study combined publicly available quality data, list prices and insurer contracts for 2017. Clinical outcomes of 5 elective surgeries (total hip and knee replacement, anterior cruciate ligament (ACL), cataract and carpal tunnel surgeries) were compared using zero-or-one inflated beta-regressions, corrected for underlying structural factors (ie, volume of care, process and structure indicators, and chain affiliation). Furthermore, price differences between ITCs and GHs were examined using ordinary least squares regressions. Lastly, we analysed quality of care in relation to the number of insurance contracts of the 4 largest Dutch insurance companies using ordered logistic regressions. Results: Quality differences between ITCs and GHs were found to be inconsistent across procedures. No facility type performed better overall. There were no differences exhibited in the list prices between ITCs and GHs. No consistent relationship was found between the underlying factors and quality or price, in different procedures and time. We found no indication for selective contracting based on quality within the ITC sector.Conclusions: This study found no evidence that ITCs outperform GHs on quality or price. This evidence does not support the focus factory theory. The substantial practice variation in quality of care may justify more evidence-based contracting within the market for elective surgery

Relationship between the Ownership Status of Nursing Homes and Their Outcomes During the COVID-19 Pandemic: A Rapid Literature Review

Context: Some nursing homes fared better than others to protect themselves against the 2019 coronavirus disease (COVID-19). Organisational characteristics may mediate the effect of the COVID-19 pandemic. Previous reviews have suggested for-profit providers provide worse quality of care. Does ownership also matter in the response to the COVID-19 pandemic? Objective: The aim of this literature review is to evaluate the relationship between ownership structure of nursing homes and their performance during the pandemic, measured as COVID-19 cases and deaths. Method: A rapid literature review was conducted in PubMed and Web of Science, following a systematic approach. The search was conducted in October 2020 and updated in December 2020. Articles were selected based on a pre-defined set of PICOT criteria and underwent risk of bias assessment. Findings: Eighteen papers were included in this rapid review. These papers cover a period from March to July 2020. The majority of papers found a significant relationship in the unadjusted statistics between ownership status and effectiveness in response to the COVID-19 pandemic. However, the adjusted figures paint a more nuanced picture. The relationship seems to be mediated by other organisational (e.g., size), process (e.g., staff shortages) and contextual factors (e.g., regional spread of COVID-19) in comparison to ownership directly. Limitations: The majority of the included studies focus on North America, and most studies are of low to medium quality with respect to research methodology. Implications: In the short-term, it will likely be more effective to address identified mediating factors of the relationship between ownership and COVID-19 outcomes; but for the long-term, this review is in keeping with previous literature suggesting policymakers should be cautious about encouraging the ownership of nursing homes by for-profit providers