STATES CHRONICLE – Could a non-profit hospital be the new way to make money? And we are not talking about some pocket change or spare money, the numbers run in the hundreds of millions.
Some people had the idea of betting on a non-profit hospital, and it surely looks like they have all the reasons to not regret it! In a study analyzing net income derived from patient care in 2013, researchers from the School of Public Health Johns Hopkins Bloomberg, Washington and Lee University with lead author and Professor Gerard Anderson, concluded that more non-profit U.S. hospitals than for profit hospitals make the most money: 7 out of 10 hospitals to be precise.
Besides, the study didn’t even include income generated from other activities related to the hospital, such as parking fees, gift shop sales, donations, investments and so on.
At the top of the list is the Medical Center in La Crosse, Wisconsin, the Gundersen Lutheran Hospital, with a staggering $302.5 million dollars made from care services in the fiscal year 2013. Following with another vertiginous amount, comes Stanford Hospital of Palo Alto, California: $225 million dollars.
What is their secret?
The purpose of the study was to investigate on the characteristics of the most profitable United States hospitals, to discover the secrets of their money making methods. And they discovered that belonging to a system determines local market domination and the ability to negotiate higher prices for patients with private insurance. Not having the health care providers attending you covered by a network, you end up paying even more.
Being designed as non-profit, the hospitals receive federal and state tax breaks. And these tax exemptions have doubled in the past decade. It has also brought our policymakers to the consideration of demanding non-profit hospitals the reinvestment of their profit in the community benefit.
But the study has its limitations. Adjusting its numbers to other variables, such as more fiscal years or rural hospitals, the study could conclude that non-profit hospitals lose money, rather than making fortunes.
Being one of the largest property owners and employers in the USA, the hospital as an entity does have a lot of attention drawn to it, but if you add non-profit that generates more profit than those designed for profit, the heat doubles.
The word “profit” or the expression “money making” should simply not be in the same sentence with hospital and health care, but being a money driven society, the question remains: could a non-profit hospital be the new way to make money?
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