Academic journal article Frontiers of Health Services Management

Letter to the Editor

Academic journal article Frontiers of Health Services Management

Letter to the Editor

Article excerpt

Dear Editor:

I have difficulty in recognizing the nonprofit hospital on whose board I serve, or the university where I work, in Mark Pauly's article on health systems ownership in the Spring 1996 issue of Frontiers. Whatever their motivation to serve, board control of these institutions is not determined by their provision of equity capital. I would go further and say that decisions in nonprofit hospitals are not made primarily relative to a criterion of return on investment, nor do board members serve primarily for economic reasons. In fact it costs them money and time for little or no economic return.

Moreover, I do not agree with Pauly's assertion that "the mechanism we have constructed to choose, finance and provide benefits of community or collective value is government." How does this explain the over one million nonprofit community organizations we have in this country? Clearly, in thousands of communities across the United States, people see value in giving, working and receiving services from organizations which are neither for-profit nor public.

Nor do I agree with Pauly's assertion that nonprofit hospitals "do not provide more community benefit without raising prices. …

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