Center for Social Innovation

As healthcare costs mount, a new study indicates that nonprofit healthcare providers are more cost-effective and provide better care than their forprofit competitors.

Pauline Vaillancourt Rosenau and Stephen Linder, both of the University of Texas-Houston's School of Public Health, published their findings, "Two Decades of Research Comparing For-Profit and Nonprofit Health Provider Performance in the United States," last June in Social Science Quarterly (vol. 84, no. 2).

Rosenau and Linder looked back at 22 years of research and reviewed 149 previous studies that compared differences in for-profit and nonprofit healthcare providers' performance on at least one of the following measurement scales: cost, quality, access, and charity care. The reviewed studies took place between 1980 and 2002, and the sample only included providers in the United States.

What they found may surprise some free market capitalists. Nonprofits, according to the study, were more cost-effective than for-profit providers. Only 23 percent of studies reported for-profits to be ... Read more