Analyzing the Relationship Among Critical Access Hospital Financial Status, Organizational Linkages, and Scope of Services

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January 2006
This project systematically analyzed the relationships among pre- and post-conversion Critical Access Hospital (CAH) financial performance, the organizational linkages in which the hospital participates (e.g., health care systems and/or networks), and the scope of services (i.e., the number and type of services) provided. The project used data from four sources: Medicare cost reports, three national surveys of CAHs conducted by the Tracking Project and the Monitoring Team in 2000, 2001, and 2004, the American Hospital Association annual survey of hospitals, and the Area Resource File. Research questions addressed by this project included the following: To what extent does improved financial performance (as reflected in operating margins) allow CAHs to add and/or expand specific services? Are expansions in these services most likely to occur within 2 years after conversion, or more than 2 years after conversion? Does participation in a system and/or a network increase the likelihood that a CAH will expand and/or add specific services post-conversion? Are CAHs that have stronger relationships with their support hospitals more likely to expand and/or add specific services? What are the characteristics (e.g. scope of services, organizational linkages) of CAHs that exhibit improved financial performance in the short term?

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