Abstract
Since 1985, the proportion of for-profit community hospitals has hovered around 15 percent (AHA 1988, 2002). Although nonprofit hospital conversions to for-profit status have yet to significantly alter the overall distribution of investor ownership in the hospital sector, the consequences continue to cause considerable concern (Claxton et al. 1997; Cutler 2000). This is true primarily because investor ownership imposes new fiduciary responsibilities that may undermine a hospital's implicit social contract to meet the needs of the community it serves, regardless of profitability. Given this, many worry that for-profit health institutions will harm local communities, particularly the availability of services for uninsured and underinsured populations. Thus, much attention has focused on the impact of ownership change on a hospital's provision of uncompensated care and other unprofitable but socially valuable services.