Week 3: Written Assignment Keller Graduate School of Management Health Service Systems - 60106: HSM541 Nonprofit Versus For-Profit Healthcare And Organizations For-profit hospital boards to main tain a business-driven culture, healthcare providers need to have the financial avenue when it comes to ...
, Nonprofit Versus For-Profit Healthcare And Organizations
For-profit hospital boards to maintain a business-driven culture, healthcare providers need to have the
financial avenue when it comes to investing in technology. This can often offer the best healthcare in the
very efficient ways. Having adequate funds for technology also means greater protection against any
cyber-risk for patients, shareholders, and the public which are often targeted. For-profit corporations that
own multiple hospitals can make use of all of their own resources, which includes, in-house legal counsel
and specialized consultants, instead of needing to use outside professionals. Another benefit is that large
healthcare organizations can share their best practices with their sister facilities.
While non-profit healthcare organizations can enjoy the tax-exempt status from property and income
taxes, they have to rely on donors, the community, and minor investments, for funding in order to
provider care for their patients. Non-profit healthcare organizations, in reality, don’t have a real
understanding when it comes to profit. While they have some limitations when it comes to investing
without trying to comprise their nonprofit status. They typically take any overage and reinvest in either
maintaining facilities, purchasing new medical equipment, updating technology, or anything pertaining to
necessary medical improvements. Non-profit healthcare organizations typically promote a culture which
is service driven instead of business-driven. As service-driven entities, non-profit healthcare
organizations are more aggressive when it comes to negotiating expenses, such as, contracts for managed
care.
All companies have a distinct purpose, but what the difference is between a nonprofit and a for-profit is
the starkest. While for-profit organizations may have a variety of goals, their primary mission is to
generate profit and develop effective products and services that are valuable to the consumers. A
nonprofit, by contrast, doesn’t prioritize profits, instead, they are dedicated to promoting social causes or
advocating for something meaningful. Success for nonprofits is normally measured based on their
organizational mission.
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