title: Performing well in financial management and quality of care: evidence from hospital process measures for treatment of cardiovascular disease.
abstract: BACKGROUND
  Fiscal constraints faced by U.S. hospitals as a result of the recent economic downturn are leading to business practices that reduce costs and improve financial and operational efficiency in hospitals. There naturally arises the question of how this finance-driven management culture could affect the quality of care. This paper attempts to determine whether the process measures of treatment quality are correlated with hospital financial performance.
  
  
  METHODS
  Panel study of hospital care quality and financial condition between 2005 and 2010 for cardiovascular disease treatment at acute care hospitals in the United States. Process measures for condition-specific treatment of heart attack and heart failure and hospital-level financial condition ratios were collected from the CMS databases of Hospital Compare and Cost Reports.
  
  
  RESULTS
  There is a statistically significant relationship between hospital financial performance and quality of care. Hospital profitability, financial leverage, asset liquidity, operating efficiency, and costs appear to be important factors of health care quality. In general, public hospitals provide lower quality care than their nonprofit counterparts, and urban hospitals report better quality score than those located in rural areas. Specifically, the first-difference regression results indicate that the quality of treatment for cardiovascular patients rises in the year following an increase in hospital profitability, financial leverage, and labor costs.
  
  
  CONCLUSIONS
  The results suggest that, when a hospital made more profit, had the capacity to finance investment using debt, paid higher wages presumably to attract more skilled nurses, its quality of care would generally improve. While the pursuit of profit induces hospitals to enhance both quantity and quality of services they offer, the lack of financial strength may result in a lower standard of health care services, implying the importance of monitoring the quality of care among those hospitals with poor financial health.
authors: Department of Health Policy and Management, Mailman School of Public Health, Columbia University, 600 W 168th Street, 10032, New York, NY, USA. gd2243@columbia.edu.
authors: Gang Nathan
authors: GN
authors: Dong
mesh_terms: D002318:Cardiovascular Diseases / Q000191:economics* / Q000628:therapy*; D003422:Critical Care / Q000191:economics* / Q000706:statistics & numerical data; D003695:Delivery of Health Care / Q000191:economics* / Q000706:statistics & numerical data; D005377:Financial Management, Hospital / Q000191:economics* / Q000706:statistics & numerical data; D006801:Humans; D017064:Process Assessment, Health Care / Q000191:economics* / Q000706:statistics & numerical data; D011787:Quality of Health Care / Q000191:economics* / Q000706:statistics & numerical data; D014481:United States
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