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

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.

Independent Treatment Centres Are Not a Guarantee for High Quality and Low Healthcare Prices in The Netherlands - A Study of 5 Elective Surgeries.

BACKGROUND: Independent treatment centres (ITCs) are a growing phenomenon in many healthcare systems. Focus factory theory predicts that ITCs provide high quality healthcare with low prices, through specialisation, high-volume and routine. This study examines if ITC care outperforms general hospital (GH) care within a regulated competition system in the Netherlands, by focusing on differences in healthcare quality and price. METHODS: The cross-sectional study combined publicly available quality data, list prices and insurer contracts for 2017. Clinical outcomes of 5 elective surgeries (total hip and knee replacement, anterior cruciate ligament (ACL), cataract and carpal tunnel surgeries) were compared using zero-or-one inflated beta-regressions, corrected for underlying structural factors (ie, volume of care, process and structure indicators, and chain affiliation). Furthermore, price differences between ITCs and GHs were examined using ordinary least squares regressions. Lastly, we analysed quality of care in relation to the number of insurance contracts of the 4 largest Dutch insurance companies using ordered logistic regressions. RESULTS: Quality differences between ITCs and GHs were found to be inconsistent across procedures. No facility type performed better overall. There were no differences exhibited in the list prices between ITCs and GHs. No consistent relationship was found between the underlying factors and quality or price, in different procedures and time. We found no indication for selective contracting based on quality within the ITC sector. CONCLUSION: This study found no evidence that ITCs outperform GHs on quality or price. This evidence does not support the focus factory theory. The substantial practice variation in quality of care may justify more evidence-based contracting within the market for elective surgery.

For-Profit Nursing Homes in the Netherlands: What Factors Explain Their Rise?

This exploratory, mixed-methods study analyzes characteristics of the emerging for-profit nursing home industry in the Netherlands and identifies the interrelated set of factors (context, trends, and sector conditions) that contribute to its growth. Until recently, the Dutch nursing home sector relied almost exclusively on nonprofit providers. Even though profit distribution in nursing home care is still banned, the for-profit nursing home sector is expanding. The study uses economic theory on nonprofit organizations and mixed-form markets to understand this expansion. We find that changes in the regulatory framework have unlocked the potential of the for-profit nursing home sector, enabling for-profit nursing homes to circumvent the for-profit ban. The expansion of the for-profit sector was mainly driven by the low responsiveness of the nonprofit sector to increased and changed demands. For-profit providers took advantage of this void. Moreover, they exploited "cream-skimming" potential in the market and used the wider care system to reduce their labor costs by relying on external specialist care. Another main driver was the access to financial capital from private investors (e.g., private equity firms).

Is there a volume-quality relationship within the independent treatment centre sector? A longitudinal analysis.

BACKGROUND: The number of independent treatment centres (ITCs) has grown substantially. However, little is known as to whether the volume-quality relationship exists within this sector and whether other possible organisational factors mediate this relationship. The aim of this study is to gain a better understanding of such possible relationships. METHODS: Data originate from the Dutch Health and Youth Care Inspectorate (IGJ) and the Dutch Patients Association. We used longitudinal data from 4 years (2014-2017) including three different quality measures: 1) composite of structural and process indicators, 2) postoperative infections, and 3) patient satisfaction. We measured volume by the number of invasive treatments. We adjusted for three important organisational characteristics: (1) size of workforce, (2) chain membership, and (3) ownership status. For statistical inference, random effects analysis was used. We also ran several robustness checks for the volume-quality relationship, including a fractional logit model. RESULTS: ITCs with higher volumes scored better on structure, process and outcome (i.e. postoperative infections) indicators compared to the low-volume ITCs - although only marginally on outcome. However, ITCs with higher volumes do not have higher patient satisfaction. There is a decreasing marginal effect of volume - in other words, an L-shaped curve. The effect of the intermediating structural factors on the volume-quality relationship (i.e. workforce size, chain membership and ownership status) is less clear. Our findings suggest that chain membership has a negative influence on patient satisfaction. Furthermore, for-profit providers scored better on the Net Promoter Score. CONCLUSIONS: Our study shows with some certainty that the quality of care in low-volume ITCs is lower than in high-volume ITCs as measured by structural, process and outcome (i.e. postoperative infection) indicators. However, the size of the effect of volume on postoperative infections is small, and at higher volumes the marginal benefits (in terms of lower postoperative infections) decrease. In addition, volume is not related to patient satisfaction. Furthermore, the association between the structural intermediating factors and quality are tenuous.