Health Care costs more, delivers less at investor-owned private for-profit hospitals, major study finds

/Note: The Information in this release is under embargo until 5 pm EDT,

Monday, June 7th:/



Jun 07, 2004, 01:00 ET from McMaster University Health Sciences

    TORONTO, June 7 /PRNewswire/ - Canadian governments would pay an extra
 $7.2 billion in annual health care costs if Canada switched to investor-owned
 private for-profit hospitals, according to a major study to be published in
 the Canadian Medical Association Journal (CMAJ) tomorrow.
     The research builds on earlier findings released in 2002 by the same
 McMaster University research group that revealed higher death rates in
 investor-owned private for-profit hospitals and kidney dialysis centres in the
 United States.
     "Our previous study showed the profit motive results in increased death
 rates, and this one shows it also costs public payers more," said
 Dr. P.J. Devereaux, lead author of the study. "With for-profit care, you end
 up paying with your money, and your life."
     The systematic review is based on a study of over 350,000 patients
 between 1980 and 1995 who were treated in private for-profit and not-for-
 profit U.S. hospitals. The study found that care cost the patients 19% more at
 for-profit hospitals. In an accompanying CMAJ editorial Drs. Steffie
 Woolhandler and David Himmelstein from Harvard University described the
 systematic review and meta-analysis by Dr. Devereaux and colleagues as,
 "meticulous."
     "Patients pay more for care at investor-owned for-profit hospitals
 because the for-profit hospitals have to generate revenues to satisfy
 investors, high executive bonuses, and high administrative costs," said
 Dr. Devereaux. "Not-for-profit providers charge less for care because they do
 not have investors and have lower executive bonuses, and administrative
 costs," he adds.
 
     The results of this review are directly relevant to Canadians for three
 major reasons:
 
     -  The statistically significant higher payments for care at a wide range
        of investor-owned hospitals spanned a 12 year period, despite
        significant changes to the American health care system
     -  The results were demonstrated among both publicly funded patients and
        among privately funded patients.
     -  If Canada moves to for-profit hospitals, the same large American
        hospital chains included in the review would be purchasing Canadian
        hospitals.
 
     "Health care is a central issue of the federal election campaign. As
 well, a number of provinces have allowed for-profit surgical facilities and
 radiology facilities and the Conservative party advocates a permissive stance
 with regards to investor-owned private for-profit health care facilities,"
 notes Dr. Devereaux.
     "Our results should raise serious concerns about moves to private
 for-profit care, whether in hospitals, day surgeries, or other outpatient
 facilities. Evidence strongly supports a policy of not-for-profit health care
 delivery."
 
 

SOURCE McMaster University Health Sciences
    TORONTO, June 7 /PRNewswire/ - Canadian governments would pay an extra
 $7.2 billion in annual health care costs if Canada switched to investor-owned
 private for-profit hospitals, according to a major study to be published in
 the Canadian Medical Association Journal (CMAJ) tomorrow.
     The research builds on earlier findings released in 2002 by the same
 McMaster University research group that revealed higher death rates in
 investor-owned private for-profit hospitals and kidney dialysis centres in the
 United States.
     "Our previous study showed the profit motive results in increased death
 rates, and this one shows it also costs public payers more," said
 Dr. P.J. Devereaux, lead author of the study. "With for-profit care, you end
 up paying with your money, and your life."
     The systematic review is based on a study of over 350,000 patients
 between 1980 and 1995 who were treated in private for-profit and not-for-
 profit U.S. hospitals. The study found that care cost the patients 19% more at
 for-profit hospitals. In an accompanying CMAJ editorial Drs. Steffie
 Woolhandler and David Himmelstein from Harvard University described the
 systematic review and meta-analysis by Dr. Devereaux and colleagues as,
 "meticulous."
     "Patients pay more for care at investor-owned for-profit hospitals
 because the for-profit hospitals have to generate revenues to satisfy
 investors, high executive bonuses, and high administrative costs," said
 Dr. Devereaux. "Not-for-profit providers charge less for care because they do
 not have investors and have lower executive bonuses, and administrative
 costs," he adds.
 
     The results of this review are directly relevant to Canadians for three
 major reasons:
 
     -  The statistically significant higher payments for care at a wide range
        of investor-owned hospitals spanned a 12 year period, despite
        significant changes to the American health care system
     -  The results were demonstrated among both publicly funded patients and
        among privately funded patients.
     -  If Canada moves to for-profit hospitals, the same large American
        hospital chains included in the review would be purchasing Canadian
        hospitals.
 
     "Health care is a central issue of the federal election campaign. As
 well, a number of provinces have allowed for-profit surgical facilities and
 radiology facilities and the Conservative party advocates a permissive stance
 with regards to investor-owned private for-profit health care facilities,"
 notes Dr. Devereaux.
     "Our results should raise serious concerns about moves to private
 for-profit care, whether in hospitals, day surgeries, or other outpatient
 facilities. Evidence strongly supports a policy of not-for-profit health care
 delivery."
 
 SOURCE  McMaster University Health Sciences