A financial executive with experience in the Pennsylvania and Ohio nonprofit healthcare sectors, Brian Derrick has more than 20 years of experience. In his most recent role at Summa Health System, he met several milestones, such as acquiring a minority investment of $250 million and improving service delivery systems leading to an annual benefit of more than $130 million. Brian Derrick was also a part of Pennsylvania’s Einstein Healthcare Network, a safety net healthcare system that provides many services that overlap with for-profit organizations.
Beyond the basic diagnostic and care and facilities required of medical service centers, the services that for-profit and nonprofit hospitals provide depend largely on their objectives. For-profit hospitals focus on generating revenue, so they run extensive marketing efforts, and add facilities and offer treatments based on the profit generated by their inclusion, and the cost to offer them. In contrast, nonprofit facilities offer services most desired by the local community. Accordingly, for-profit hospitals may not offer services like organ transplants, referring patients to non-profits instead, since the overall cost of such procedures may cause them to incur losses.
The distinctions between non-profit and for-profit hospitals become less clear in certain circumstances, however. Notably, nonprofit hospitals may experience financial problems, which prevent them from generating enough revenue to remain in their current state. Therefore, they either raise prices, ally themselves with a for-profit hospital, or both. Conversely, to satisfy stakeholder desires, for-profit hospitals may end up delivering types of care associated with nonprofit ones. By offering more cost-conscious services, they may also have cheaper operating expenses, and be more common in lower rent and lower income areas that have fewer accessible options. Thus, for-profit hospitals may be the more convenient point of contact for logistical reasons, even if non-profits are structured to reach people who are uninsured or unable to pay.
Beyond the basic diagnostic and care and facilities required of medical service centers, the services that for-profit and nonprofit hospitals provide depend largely on their objectives. For-profit hospitals focus on generating revenue, so they run extensive marketing efforts, and add facilities and offer treatments based on the profit generated by their inclusion, and the cost to offer them. In contrast, nonprofit facilities offer services most desired by the local community. Accordingly, for-profit hospitals may not offer services like organ transplants, referring patients to non-profits instead, since the overall cost of such procedures may cause them to incur losses.
The distinctions between non-profit and for-profit hospitals become less clear in certain circumstances, however. Notably, nonprofit hospitals may experience financial problems, which prevent them from generating enough revenue to remain in their current state. Therefore, they either raise prices, ally themselves with a for-profit hospital, or both. Conversely, to satisfy stakeholder desires, for-profit hospitals may end up delivering types of care associated with nonprofit ones. By offering more cost-conscious services, they may also have cheaper operating expenses, and be more common in lower rent and lower income areas that have fewer accessible options. Thus, for-profit hospitals may be the more convenient point of contact for logistical reasons, even if non-profits are structured to reach people who are uninsured or unable to pay.
