Hospital Governance, Performance Objectives, and Organizational Form

35 Pages Posted: 25 Jul 2000  

Leslie Eldenburg

University of Arizona

Benjamin E. Hermalin

University of California, Berkeley

Michael S. Weisbach

Ohio State University (OSU) - Department of Finance; National Bureau of Economic Research (NBER)

Marta Wosinska

Harvard Business School

Multiple version iconThere are 3 versions of this paper

Date Written: June 2000

Abstract

This paper studies the governance of a sample of California hospitals. We document a number of empirical relations about hospital governance: The composition of the board of directors varies systematically across ownership types; poor performance and high administrative costs increase board turnover, with this sensitivity varying by organizational type; and poor performance, high administrative costs, and high uncompensated care lead to higher CEO turnover, with these effects again varying across different organizational types. Overall, these results are consistent with the view that boards of directors of hospitals of different organizational forms are substantially different, and that these boards make decisions to maximize different objective functions.

Keywords: board structure, corporate governance

JEL Classification: G34, I12

Suggested Citation

Eldenburg, Leslie and Hermalin, Benjamin E. and Weisbach, Michael S. and Wosinska, Marta, Hospital Governance, Performance Objectives, and Organizational Form (June 2000). Presented at Tuck-JFE Contemporary Corporate Governance Conference. Available at SSRN: https://ssrn.com/abstract=236106 or http://dx.doi.org/10.2139/ssrn.236106

Leslie G. Eldenburg

University of Arizona ( email )

McClelland Hall Room 301H
Tucson, AZ 85721
United States
520-621-4585 (Phone)
520-621-3742 (Fax)

Benjamin E. Hermalin

University of California, Berkeley ( email )

545 Student Services Building, #1900
2220 Piedmont Avenue
Berkeley, CA 94720
United States
510-642-7575 (Phone)
510-643-1420 (Fax)

Michael S. Weisbach (Contact Author)

Ohio State University (OSU) - Department of Finance ( email )

2100 Neil Avenue
Columbus, OH 43210-1144
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Marta Wosinska

Harvard Business School ( email )

Soldiers Field
Boston, MA 02163
United States
617-495-6548 (Phone)
617-496-5853 (Fax)

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