Maintaining sustainability of acute care hospitals

Michael M. Costello, Daniel J. West, Bernardo Ramirez


Given the significance of hospital costs as a component of a nation’s total health care spending, governments are giving increasedscrutiny to hospital privatization as a means of controlling cost escalation. While the means of privatization may differamong nations, such transitions mean the introduction of market forces into the supply and availability of hospital services.Correspondingly, nations must determine whether market forces alone should determine whether specific hospitals should beallowed to close based upon the owner’s sole determination. Responses to the financial crisis of 2007-2009 show that governmentintervention preserved several financial institutions whose closure or bankruptcy would have meant the termination ofcritical financial services. The authors believe that such intervention can be rationalized in certain cases of potential acute carehospital closures. Several international examples of health policies intended to maintain government involvement after hospitalprivatization are included.

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Journal of Hospital Administration

ISSN 1927-6990(Print)   ISSN 1927-7008(Online)

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