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KMID : 0950020060320010001
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Journal of Health Science & Medical Technology
2006 Volume.32 No. 1 p.1 ~ p.12
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The Financial Structure and Profitability Comparison of Private Hospitals and Corporate Hospitals in Korea
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Choi Man-Kyu
Moon Sang-Sik
Yun Chang-Soo
Kim Jin-Hee
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Abstract
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This study was performed to compare and identify factors shaping the financial structure and profitability between private hospitals and corporate hospitals in Korea. The main purpose of the study was to provide information to hospitals in maintaining sound financial structure and improving profitability. Data used in this study were collected from 22 private and 45 corporate hospitals with complete general data of present conditions as well as financial statements(balance sheets, income statements). The cases included in the study were chosen from hospitals that passed the standardization audit undertaken by the Korean Hospital Association from 1998 to 2001 for the purpose of accrediting training hospitals. The hospital management indicators used in this study were stability indicators, profitability indicators, activity indicators, productivity indicators, and other management indicators related to the medical utilization of patients. Comparison analysis results on the hospital management indicators of private hospitals and corporate hospitals were that corporate hospitals had more liabilities and less liquidity than private hospitals, and the former paid more medical expenses(personnel, material, and administrative expenses) than the latter. This was the main reason why corporate hospitals had lower profitability than private hospitals especially in net profit to total assets, normal profit to gross revenues, and net profit to gross revenues. The factors that had significant effect on liabilities to total assets of corporate hospitals were inventories turnover(negative), normal profit to total assets(negative), and net profit to gross revenues(negative). And concerning the current ratio, there were period of establishment(negative), patient receivable turnover(negative), value analysis to personal expenses(positive), admission of outpatients(positive), and net profit to gross revenues(positive). The factors that had significant effect on liabilities to total assets of private hospitals were operating bed numbers(negative), period of establishment(positive), average length of stay(positive), and net profit to gross revenues(negative). And concerning the current ratio, there was only average length of stay(negative). The factors that had significant effect on both normal profit to total assets and net profit to gross revenues of corporate hospitals were liabilities to total assets(negative), administrative expenses per adjusted patient(negative), material costs per adjusted patient(positive). And the factors that had significant effect on both normal profit to total assets and net profit to gross revenues of private hospitals were operating bed numbers(positive), value analysis to personal expenses(positive), administrative expenses per adjusted patient(negative).
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KEYWORD
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hospital, financial structure, profitability
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