No. 02: A Systematic Review and Meta-Analysis of Studies Comparing Mortality Rates of Private For-Profit and Private Not-For-Profit Hospitals

February 2008

Background

The hypothesis that private for-profit health care results in increased efficiency and quality of care is examined.

Objective

To compare the mortality rates in private for-profit versus private not-for-profit hospitals in the United States.

Design

A meta-analysis consisting of fifteen observational studies involving more than 26000 hospitals and 38 million patients in the US.

Focus

Mortality rates of patients

Results

There exists a significantly increased risk of mortality in private-for-profit hospitals as compared to private not-for-profit hospitals in the US.

Limitations

The study design was a meta-analysis of previously conducted observational and highly heterogeneous studies.  As such, there could be other variables that explain a reduced mortality rate in not-for-profit hospitals. However, careful consideration of likely confounding variables, namely hospital teaching status, patient disease severity, and proportion of publicly (eg, US Medicare) vs privately insured patients, revealed that the conclusions may, if anything, underestimate the potential increase in mortality associated with private for-profit hospital care.

Conclusion

There is a significantly increased risk of mortality in private for-profit hospitals as compared to private not-for-profit hospitals in the US.

Discussion

The increase in mortality in private for-profit institutions may be attributable to the fact that investors expect a return on their investment, and the institutions indeed have a fiduciary responsibility to their investors, first and foremost. As a consequence, when dealing with patients for whom the reimbursement rate is similar (eg. Medicare fee schedules), monies that would otherwise be spent on patient care must be siphoned off as profit, reducing either quality of care (by employing fewer highly skilled personnel), access to care (through refusing to treat the more severely ill and, therefore, more costly patients) or both.

Relevance

While these are U.S. data, they address an issue being considered in Canada, where we have little research and experience with private for-profit care.  It can be assumed that for-profit care providers in Canada would face the same problem as in the US in holding down costs while attempting to deliver quality care and to sustain a profit.  Therefore, not-for-profit hospitals in Canada are likely to offer better health outcomes with respect to patient mortality, as they do in the US.

A Systematic Review and Meta-Analysis of Studies Comparing Mortality Rates of Private For-Profit and Private Not-For-Profit Hospitals. P.J. Devereaux, et al CMAJ May 28, 2002; 166 (11).

Click here to read the pdfs of e-Rounds #02: [ENGLISH] [FRENCH]

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