The hospital is an economic unit and an open system, and it is in a continuous interdependent relationship both with its internal and external environment. The main purpose of the hospital is to produce services at the lowest possible cost. In order for the hospital to realize its purpose, the hospitals’ management needs to make decisions related to the following: Investment in services System membership Response to market demand Provision of quality services in a cost-effective manner and The safeguard of funding resources The analysis of the role of hospitals takes into account the structure of the hospitals. In the case of for-profit hospitals, the profit-maximization rule is applied. In the nonprofit or in the public hospitals, the main purposes of the hospitals which are determined by the administration could be the revenue maximization and the quantity- and quality-maximizing model. The decision maker in the case of hospitals is the administration, and in many cases, physicians have the main role in determining the policy of the hospital. Based on the latter, the most important determinant of hospital behavior is the human factor since everything is about decisions and the policies that are in place.
In particular, this chapter:
Clarifies the purposes of the hospital and provides a general overview of the hospitals’ main aims so as to achieve a successful economic performance
Presents and describes in an analytical way the determinants of the behavior of hospitals
Addresses the financing paths for hospitals and also identifies the hospitals expenditures
Describes the theoretical framework of the hospitals’ goals in an analytical and substantive manner