Board structure and community benefit services of not-for-profit hospitals

Abstract

Objective: To examine if the structure and composition of a hospital Board of Directors can have an impact on the capacity of Taiwan`s private not-for-profit hospitals to deliver community benefit services. Method: Using unbalanced panel data collected between 2000 and 2004 through audited financial statements and surveys from 36 private not-for-profits hospitals in Taiwan, this article explores whether Board structure and composition has an impact on education and research expenditures, uncompensated care service expenditures, and community benefit services offered by these hospitals. Results: Our regression analysis data suggest that Board size has a significantly positive relationship with uncompensated care expenditures and community benefit service expenditures. The percentage of outsiders on the Board has a significantly positive relationship with research and education service expenditures. In addition, executives on the Board have a significantly positive impact on research and education expenditures while having a negative impact on uncompensated care expenditures. Conclusions: All private not-for-profit hospitals have the social role to provide community benefit services and the business role to make profits. The Board of Directors is composed according to each organization`s established purpose. Results of this research show that board structure and composition are able to affect hospital performance. This board structure and composition effect for not-for-profit hospitals can make normal reference as the competent authority.