Currently, I am working at Cleveland Clinic Florida on Weston Hospital. Weston
Hospital is a not-for-profit, multi-specialty, academic medical center (AMC) that
integrates clinical and hospital care with research and education. The campus includes
diagnostic centers, outpatient surgery, and a 24-hour emergency department located in a
state-of-the-art hospital (Cleveland Clinic, n.d.). I am familiar with the competition among
hospitals near my hospital and the acquisition of independent hospitals by for-profit or
non-for-profit hospitals. Cleveland Clinic Florida has to compete with not-for-profit
hospital systems like Memorial Hospital System and Baptist Health South Florida and for-
profit healthcare systems like Steward Health Care and HCA Healthcare.
What are some business and financial implications of the differences between
community not-for-profit hospitals and large academic medical centers that
may affect staffing, programs offered, and policies and procedures?
Community hospitals are nonfederal short-stay hospitals whose services are
available to the public. Private non-for-profit Hospitals, also called voluntary
hospitals,+are+non-government and privately owned hospitals that make a profit but do not
pay taxes. Community associations, churches, and non-government organizations operate
private, not-for-profit hospitals. Private for-profit hospitals, also known as proprietary
hospitals, are investor-owned hospitals such as individuals, partnerships, or corporations
for profit. These hospitals are operated for the financial benefit of stockholders. Research
shows that both non-for-profit and for-profit hospitals provide charity care, but non-for-
profit spend little more. AMCs have active affiliation and collaboration among a
university, medical school, hospital/health system, and health care professionals to offer
one or more graduate residency programs approved by the American Medical Association.
They also deliver specialized care for many complex conditions for patients (Shi & Singh,
2019).
What financial impacts could result if a for-profit organization was built
within your community?
Even though many economists urge that for-profit ownership is naturally more
efficient because these institutions must continuously strive to outperform nonprofit or
public organizations to maximize profit and satisfy their shareholders, empirical evidence
contradicts this. For-profit hospitals tend to charge higher prices that reflect their wider
profit margins and higher overhead and capital expenditures than public and nonprofit
hospitals. The entry of for-profit providers into the market might push non-for-profits to
adopt similar structures and strategies pressuring them to increase their efficiency or to
focus on profitable services such as elective surgeries and minimize charity care. For-
profit hospitals tend to acquire inefficient public and nonprofit organizations making them
less efficient (Jeurissen et al., 2020).
It is hard to tell whether for-profit hospitals in the neighborhood will detrimentally
affect the service of my organization or not. For-profit organizations may streamline the
public and not-for-profit hospitals they acquire and thereby achieve greater efficiency.
Cost-containment measures and payment arrangements, which have squeezed some
nonprofit and public hospitals stimulated for-profit growth by providing investors to
acquire facilities at low costs.+The commercialization of hospital care can be a heated
political topic, with left- and right-leaning politicians often holding opposing views
(Jeurissen et al., 2020).
What are some of the financial benefits of being an academic facility rather
than a not-for-profit facility?
At an AMC, education, research, and clinical care are combined to provide the best
possible clinical care, using cutting-edge technologies, resources, and therapies other
community hospitals may not have available (Penn Medicine, 2022). Teaching hospitals
are the backbone of the U.S. healthcare system. Millions of the U.S. go to teaching
hospitals for specialized surgeries, lifesaving care, complex treatments, and critical
community services. They are the training ground for more than 100,000 new physicians
and other health professionals each year as the U.S safety net provides care to millions of
the uninsured people (UFHealth, 2017).
AMCs get+grants money available to support the academic facilities mission.+NIH
is the largest public funder of biomedical research in the world. It invests more than $32
billion a year to enhance life, reduce illness and disability. NIH-funded research has led to
breakthroughs and new treatments, helping people live longer, healthier lives, and building
the research foundation that drives discovery (National Institutes of Health, 2022). Brand
awareness and brand recognition play a significant role in a consumer purchase decision.
Brand recognition is an asset that not only adds the long-term value of a product or service
but also to an actual sale+(Stokes., 2019).+AMCs has a great name brand around the
healthcare setting helping customers attract towards them.
+
+
References
Cleveland Clinic. (n.d.).+Weston hospital (Weston,
FL).+https://onbrand.clevelandclinic.org/learn-our-story/our-locations/florida-
regional-hospitals/cleveland-clinic-florida/
Jeurissen,+P.+P., Kruse,+F.+M., Busse,+R., Himmelstein,+D.+U., Mossialos,+E., &
Woolhandler,+S. (2020). For-profit hospitals have thrived because of generous
public reimbursement schemes, not greater efficiency: A multi-country case
study.+International Journal of Health Services,+51(1), 67-
89.+https://doi.org/10.1177/0020731420966976
National Institutes of Health. (2022).+Grants & funding. National Institutes of Health
(NIH).+https://www.nih.gov/grants-funding
Penn Medicine. (2022).+What it means to be an academic medical center. University of
Pennsylvania Health System | Penn
Medicine.+https://www.pennmedicine.org/about/benefits-of-an-academic-medical-
center
Shi,+L., & Singh,+D.+A. (2019).+Essentials of the U.S. health care system+(5th+ed.). Jones
& Bartlett Publishers.
Stokes.,+J. (2019, January 8).+The importance of brand recognition in the consumer
purchase decision. Rollick
Articles.+https://gorollick.com/articles/press-release/the-importance-of-brand-
recognition-in-the-consumer-purchase-decision/
UFHealth. (2017, August 21).+Benefits of an academic health center | Patient care | UF
health Jacksonville | University of Florida health. UF Health Jacksonville |
University of Florida Health.+https://ufhealthjax.org/patient-care/benefits-
academic-health.aspx
