State interventions and hospital response in community health promotion: a comparative study of California, Texas and Florida

The growth of under and uninsured populations and the corporatization of health care have raised concerns about whether not-for-profit hospitals are fulfilling their community-oriented mission. Starting in the early 1990, state governments began instituting laws to regulate not-for-profit hospitals' provision of community benefit services in exchange for their tax exemption status and subsequent advantages. This study employs a pre-post quasi-experimental design to investigate the effectiveness of community benefit laws, factors influencing not-for-profit hospitals' abilities to comply with these laws and the potential spill-over effects on for-profit hospitals' community benefit behaviors between 1991 and 2002. Results of the study suggest that the process-oriented California community benefit law was not effective in promoting not-for-profit hospitals' community benefit activities. The prescriptive approach to state community benefit law, as seen in Texas, significantly bolstered not-for-profit hospitals' provision of charity care. Hospital size positively facilitates not-for-profit hospitals' response to the laws. The effects of other contingency factors are inconsistent across states. Finally, the spill-over effects of state community benefit laws cannot be characterized uniformly across states. For-profit hospitals' reactions to increased not-for-profit contribution to community benefit activities vary by state and by policy design