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This research examines how hospital ownership affects financial adjustments after the closure of neighboring facilities.

When a Neighbor Closes: Ownership and Hospital Profits

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This research examines how hospital ownership affects financial adjustments after the closure of neighboring facilities.
Analyzed publicly available cost report data from the National Academy for State Health Policy from 2011 to 2022.
Compared financial changes in hospitals with and without neighboring closures, focusing on those with exactly two neighbors within sixty miles.
Ensured comparable baseline market structure for accurate analysis.
For-profit hospitals showed significant increases in charge-to-cost ratios post-closure.
For-profit net-profit-margin gains were comparable in size to non-profit gains, indicating notable financial repercussions.
Governmental hospitals exhibited changes in profits that were indistinguishable from zero after closures.

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Comparative analysis demonstrates varied profit responses by hospital ownership type following closures.

Kanimian et al. (2026) studied this question.

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