Profit incentives and the hospital industry: are we expecting too much?


In the recent past, a great deal of faith has been placed in the idea that the performance of the hospital industry could be improved significantly by relying more heavily on profit incentives. This article considers the effect of profit incentives on hospital behavior and finds that the existence of profit incentives has not led the for-profit hospitals in the sample to behave in significantly different economic fashions than the nonprofits.

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