ABSTRACT
This chapter examines the organization of the hospital and studies the various forms of ownership of the hospital and the effects of such ownership on the behavior of the hospital. It focuses on the typical not-for-profit hospital that dominates the market in the US Not-for-profit hospitals differs importantly from standard corporations. In the absence of a residual claimant, their profits must be distributed to somebody else. Doctors receive admission to this medical staff by application to the hospital, nominally to the board of trustees, who are responsible for the hospital's overall activity. An important difference emerges between the "line management" and employees of the hospital and the medical staff. By 2008, hospitals in the US owned more than half of all physician practices, but still only 40 percent of primary-care doctors and 20 percent of specialists worked in hospital-owned groups.
