The Social Role of Not-for-Profit Organizations: Hospital Provision of Charity Care

Kenneth E Thorpe and Charles E Phelps

Economic Inquiry, 1991, vol. 29, issue 3, 472-84

Abstract: During the 1980s, the state of New York shifted from a straight block grant to a matching grant method for reimbursing hospitals, with the matching rate varying from 0 to 75 percent across years. These changes allow estimation of pure "income" and "price" effects for hospitals' supply of uncompensated care (charity and bad debts). The price effect is positive and significant, but no income effect was found. Hospitals in more concentrated markets provide more charity care, as do teaching hospitals, and the presence of public hospitals in a market reduces private hospitals' provision of charity care. Copyright 1991 by Oxford University Press.

Date: 1991
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