The 130th Annual Meeting of APHA

Abstract #35120

Mustafa younis, PhD, SCHOOL OF PUBLIC AND ENVIRONMENTAL AFFAIRS, Indiana University, 1800 Mishawaka Ave, South Bend, IN 46615, 219-2374824, myounis@mail1.jsums.edu

Hospitals ownership, location, and access to capital: An examination of hospitals capital structure

Introduction Hospitals capital structure and access to capital have been ignored by economic and financial theories until recently. It was easy to overlook such hospitals in the past because of their small market share and relative unimportance. However, the growth of mergers and acquisitions in the hospital industries, hospitals closures, bankruptcies and their effect in providing health services accessible to indigent populations raise several controversial issues that focus on whether there are notable differences in hospital access to capital across ownership types. Objective To describes any variation in the access to capital and debt financing by the type of ownership and location (rural vs. urban). A complete analysis of regression models is used to show differences in capital structure between three groups of ownership: for-profit (FP), non-profit (NP) and hospitals that changed ownership from non-profit to for-profit status. Design Unit of analysis: hospital three comparative groups of hospital ownership type are examined for descriptive and univariate statistics to compare all variables with respect to geographic region and ownership. Statistical tests are used to identify whether the groups differ significantly in terms of the indicators. Data Primary sources were the Medicare Cost Reports for 1991 and 1995. Results: Hospitals in rural locations had less access to capital for improving their equipment and services. For-profit hospitals had more access to capital and were more able to acquire modern medical equipment. Also, F-P hospitals used their capital to buyout other N-P hospitals.

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