Safety net hospitals governed by elected officials reported higher profits than those governed by political appointees, not-for-profit boards or for-profit directors, according to a study.
The report, published in the journal Health Affairs, compared the average operating margin across four categories of governance for 150 safety net hospitals. The hospitals were members of the National Association of Public Hospitals and Health Systems, those with a high percentage of Medicaid patients or those with a high percentage of minority patients. The data covered 2003 through 2007, the year the nation's 18-month recession began.
Public hospitals governed by elected officials operated in competitive markets reported the highest operating margin, on average, at 7%. Hospitals governed by political appointees reported a slim average 0.7% operating margin. Safety net not-for-profit and for-profit hospitals reported margins of -0.9% and -2%, respectively.