The Financially Distressed Hospital

Abstract

For at least a decade policy makers have been trying to contain health-care costs while maintaining access to care. The “financially distressed” hospital epitomizes the conflict between costs and access that makes this task so difficult. Financial distress or deficits can result from inefficiency and underuse — the very targets of regulatory or competitive strategies to contain costs. Hospitals' deficits in these circumstances need not be a cause for public distress. On the contrary, they may be evidence of the success of policy or the working of the market. On the other hand, deficits can result from the hospital's serving. © 1982, Massachusetts Medical Society. All rights reserved.