Question

Paperwork Reduction Act 1980

II. For-Profit and Nonprofit:

A. Financial Differentiation:

What differentiates for-profit and nonprofit healthcare organizations financially?

What characteristics of each type of healthcare organization make the organizations different?

B. Economic Differentiation: What differentiates for-profit and nonprofit healthcare in terms of economic policies and legislation?

What key recent and current economic policies impact each?

Answer 1

A) The main difference between the profit and nonprofit organisations how they both access their capital, as one pays the taxes and the other offers community benefits. Non profit organisations are exempted from paying taxes. Profit organisations can return the profits to their investors whereas non-profit organization must invest Profit back into the organisation. Firstly the y are differentiated by tax payments and secondly profit organizations have the advantage of limitlessly Investing their funds to raise capital.

B) Unlike the Nonprofit hospital, for-profit hospitals have to answer to their shareholders, you may not have the same interest as the local communities. For-profit hospitals are more responsive to financial incentives than the nonprofit hospitals. Under financial pressure for-profit hospitals are more likely to coose or restructure than non-profits one. And the quality of medical health care of for-profit hospitals are much better than non-profits.  

Covid 19 created economic as well as health crisis also. People get sick both during good and bad times, so demand for medical care is relatively constant across the business world. However Covid 19 is shaping this all upto different level. The financial Outlook for non profit health care due to covid 19 in US changed from stable to negative. At the same time, expenses will rise, with higher staffing cost and Need for supplies such as PPE. For profit hospitals are also running in losses.