Management strategies and financial performance in rural and urban hospitals

• Published in: Journal of medical systems Vol. 25; no. 4; pp. 241 - 255
• Main Authors: Wang, B B, Wan, T T, Falk, J A, Goodwin, D
• Format: Journal Article
• Language: English
• Published: United States Springer Nature B.V 01.08.2001
• Subjects: Analysis of Variance; Comparisons; Cost Control; Cross-Sectional Studies; Efficiency, Organizational; Finance; Financial Audit - statistics & numerical data; Financial Management, Hospital - methods; Health care; Health Services Research; Hospital Costs; Hospitals; Hospitals, Rural - economics; Hospitals, Rural - organization & administration; Hospitals, Urban - economics; Hospitals, Urban - organization & administration; Income; Information work; Linear Models; Management; Rural areas; Rural health care; Urban areas; USA; Virginia; Virginia
• ISSN: 0148-5598; 1573-689X
• DOI: 10.1023/A:1010775104091

This study identifies the difference in financial performance between rural and urban hospitals and examines whether or not that difference may be attributed to the emphasis of revenue enhancement over cost management strategies. Hospitals in Virginia were included in this study except for the two state university medical centers. Rural and urban hospitals were compared on 10 performance indicators grouped into four categories: revenues, costs, profits, and productivity. The results suggest that rural hospital profitability is dependent on cost management. Since rural hospitals achieved lower cost, better efficiency and productivity level than urban hospitals in Virginia, they demonstrate a significant higher level of profit.