Campus Units

Accounting

Document Type

Article

Publication Version

Accepted Manuscript

Publication Date

8-2019

Journal or Book Title

Journal of Business Ethics

Volume

158

Issue

2

First Page

441

Last Page

465

DOI

10.1007/s10551-017-3757-2

Abstract

Using a comprehensive sample of U.S. non-profit hospitals from 2011 to 2015, we examine the effects of state community benefits regulation (CBR) on the amount of charity care provided by and the operational efficiency of U.S. non-profit hospitals. First, we document that, under such regulations, non-profit hospitals provide more charity care and less compensated care as a proportion of net revenue. We infer from these findings that CBR has the potential to increase both non-profit hospitals’ amount of charity care and their efficiency of operations. Second, by examining variation in CBR types, we find no differences between having provision or having reporting requirements on the amount of charity care offered. Moreover, when we consider CBR with both provision and reporting requirements, the combination of these two requirements does not incrementally enhance charity care offerings, suggesting that the requirements may serve as substitutes with comparable effect. Lastly, we show that several state-level characteristics influence the relationship between CBR and charity care: CBRs in states with a higher gross domestic product and percentage of revenue received in taxes have incrementally lower associations with charity care, while hospitals in states where populations have, on average, higher household incomes have greater associations between CBR and charity care. Our findings highlight the effects that state-enacted regulation can have on socially beneficial behavior by non-profits.

Comments

This accepted article is published as Lamboy-Ruiz, M. A., Cannon, J. N., and O. V. Watanabe. 2019. Does State Community Benefits Regulation Influence Charity Care and Operational Efficiency of U.S. Nonprofit Hospitals? Journal of Business Ethics 158(2): 441–465. Doi: 10.1007/s10551-017-3757-2. Posted with permission.

Copyright Owner

Springer Science+Business Media B.V., part of Springer Nature

Language

en

File Format

application/pdf

Available for download on Saturday, August 01, 2020

Published Version

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