Thursday, May 07, 2015

Non-profit vs For-profit

There is concern in Massachusetts about a reported decline in the quality of care following the purchase of ten nursing homes in the state by Synergy Health Centers, a for-profit nursing home chain (Woes follow nursing home chain’s arrival, The Boston Globe, May 5, 2015).   The article discusses similarly reported declines in nursing homes recently purchased by Genesis Health Care and Zenith Health Care Group, two other for-profit chains. 

It all poses the issue of what role for-profit enterprise should play in the provision of health care services.

Professionalism is a very important component of our health care culture.  We believe that those who provide diagnosis, treatment and care should put the patient’s interest over their own.  They should not behave in ways that are of financial or other benefit to them but are of no value or damaging to their patients.  The reason we don’t let doctors sell medicine is because we don’t want them to be tempted to make money by prescribing a drug the patient doesn’t need or might find harmful.

As our health care system moves towards financial mechanisms that incentivize providers to do less rather than more, we will see whether the for-profits can discipline themselves to resist the temptation to withhold needed services in order to increase profits for investors. 

To some extent that will also be an issue for non-profit providers but the absence of private investors looking for a return will reduce the intensity of the temptation and public ownership will provide a more effective means of redress if they succumb. 


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