The association of debt financing with not-for-profit hospitals' operational and capital-investment efficiency. Export

@article{citeulike:1720236, abstract = {Increased debt in companies can motivate both operational and capital-investment efficiency. This positive influence of debt is attributed to creditors' oversight of corporate behavior and the need to generate cash flows to service debt. Our study investigates whether debt has a similar relationship with efficiency in not-for-profit hospitals. Using statistical analysis of a database of audited financial statements of not-for-profit hospitals, we test whether debt is associated with six distinct measures of operational and capital-investment efficiency. We find that debt either has no association with efficiency or predicts decreased efficiency. Possible explanations are that creditors' oversight is less tight in the not-for-profit setting and that debt may at times motivate excessive capital investment because of a legal requirement to tie tax-exempt debt with a capital-investment project.}, address = {Department of Health Policy and Management, School of Medicine, University of Kansas, Kansas City, KS, USA.}, author = {Magnus, S. A. and Wheeler, J. R. and Smith, D. G.}, citeulike-article-id = {1720236}, citeulike-linkout-0 = {http://view.ncbi.nlm.nih.gov/pubmed/15682951}, citeulike-linkout-1 = {http://www.hubmed.org/display.cgi?uids=15682951}, issn = {1078-6767}, journal = {J Health Care Finance}, keywords = {efficiency, finance, hospitals}, number = {4}, pages = {33--45}, posted-at = {2007-10-02 18:11:27}, priority = {0}, title = {The association of debt financing with not-for-profit hospitals' operational and capital-investment efficiency.}, url = {http://view.ncbi.nlm.nih.gov/pubmed/15682951}, volume = {30}, year = {2004} }

TY - JOUR ID - citeulike:1720236 L3 - citeulike-article-id:1720236 N2 - Increased debt in companies can motivate both operational and capital-investment efficiency. This positive influence of debt is attributed to creditors' oversight of corporate behavior and the need to generate cash flows to service debt. Our study investigates whether debt has a similar relationship with efficiency in not-for-profit hospitals. Using statistical analysis of a database of audited financial statements of not-for-profit hospitals, we test whether debt is associated with six distinct measures of operational and capital-investment efficiency. We find that debt either has no association with efficiency or predicts decreased efficiency. Possible explanations are that creditors' oversight is less tight in the not-for-profit setting and that debt may at times motivate excessive capital investment because of a legal requirement to tie tax-exempt debt with a capital-investment project. IS - 4 JF - J Health Care Finance SN - 1078-6767 AD - Department of Health Policy and Management, School of Medicine, University of Kansas, Kansas City, KS, USA. EP - 45 TI - The association of debt financing with not-for-profit hospitals' operational and capital-investment efficiency. VL - 30 SP - 33 KW - efficiency KW - finance KW - hospitals AU - Magnus, SA AU - Wheeler, JR AU - Smith, DG PY - 2004/// UR - http://view.ncbi.nlm.nih.gov/pubmed/15682951 ER -