b According to Becker (2014), one main difference between for-
profit hospitals and nonprofit hospitals is that “for-profit hospitals
pay property and income taxes while nonprofit hospitals don’t.”
Furthermore, for-profit hospitals have more opportunities to raise
capital for upgrades to their facilities like buying higher quality
medical equipment and information technology systems (Becker
2014). Another difference between for-profit and nonprofit hospitals
is that for-profit hospitals must consider and answer to shareholders
that differ from shareholders in local communities, and that have
different interests in the operation of the hospital (Becker, 2014).
Another difference is that for-profit hospitals may cut services that
have historically cost them or created more loss than gain. This is a
financial implication that is beneficial to the hospital’s shareholders,
however, some services that result in financial loss may also be
another resource for the population that will be taken away, thus
further increasing the high demand for services.
b b b Although the aforementioned impact of losing potential
services remains true, one benefit of building a for-profit
organization is that we may be able to offer more improved services
to operate in underprivileged communities (Cronin et al., 2021). New
services that have higher quality of care can also serve as a learning
institute to carry out more services for the community. Another
benefit of being an academic facility rather than a nonprofit facility is
that we can offer more preventive programs to further overall
decrease the spread of illnesses that may be chronic in nature as well.
Additionally, more benefits of for-profit hospitals are their operating
efficiency and their ability to manage revenue, which can help to
“streamline processes and track revenues from services through
reimbursement from insurers or payment directly from patients”
(Wilson, 2019). This level of organization can facilitate
communication regarding cost of medical services between patients
and their healthcare providers.
References
Becker, A. L. (2014, April 25). How different are for-profit and nonprofit
hospitals? The CT Mirror. Retrieved March 28, 2022, from
https://ctmirror.org/2014/04/25/how-different-are-for-profit-and-
nonprofit-hospitals/
Cronin, C. E., Franz, B., Choyke, K., Rodriguez, V., & Gran, B. K.
(2021). For-profit hospitals have a unique opportunity to serve as
anchor institutions in the U.S. Preventive Medicine Reports, 22. Doi:
10.1016/j.pmedr.2021.101372
Wilson, B. (2019, December 13). For profit hospitals vs. nonprofit
hospitals – the pros and cons of both. Carevoyance Blog. Retrieved
March 28, 2022, from https://www.carevoyance.com/blog/for-
profit-hospitals-nonprofit-
hospitals#:~:text=Operational%20Efficiency%20%26%20Revenue%2
0Cycle,or%20payment%20directly%20from%20patients
