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

Document Type : Perspective

Authors

1 IQ Healthcare, Radboud University Medical Center, Nijmegen, The Netherlands

2 Ministry of Health, Welfare and Sport, The Hague, The Netherlands

Abstract

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.

Keywords

Main Subjects

References

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International Journal of Health Policy and Management
Volume 9, Issue 10
October 2020
Pages 423-428

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History

  • Receive Date: 05 April 2020
  • Revise Date: 30 April 2020
  • Accept Date: 01 May 2020
  • First Publish Date: 01 October 2020

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