"For Profit" vs. "Non Profit" employers?

KelRN215, BSN, RN · Nov 23, 2013

For profit institutions have a different motive. They have share holders and they're in it to make a profit. Patient care is second to that.

Nola009 · Nov 23, 2013

Thanks, KelRN215. I know what "For Profit" means. I was just asking if anyone noticed a measurable difference in their working conditions at a publicly traded company vs. a non-profit one...? And is there so much of a difference that I should avoid working for "For Profit" companies?

LadyFree28, BSN, LPN, RN · Nov 23, 2013

I've worked at a non profit (503 c) small facility and currently work in for profit in LTC-one of largest employers in LTC.

If there is low morale, there is low morale...in my experience, it doesn't matter; if the "bottom line" doesn't include collaboration with the employees and a respect for the employee, it can be a difficult place to work, IMO.

KelRN215, BSN, RN · Nov 23, 2013

I have not worked for a for-profit system myself (ever) but I know several hospitals in my area were purchased by a for-profit system (Steward Health Care) and things seem to have changed for the worse at those facilities. They've been closing units and laying off staff with what seems like increased frequency since they took over. Many of the hospitals they purchased were already unionized and remain so. Here's an article with their CEO talking about how they wish they could lay off their most experienced/most expensive staff to save money: Steward Health Care CEO: Layoffs are needed to reduce costs in health care industry - Boston Business Journal

Nola009 · Nov 24, 2013

I have not worked for a for-profit system myself (ever) but I know several hospitals in my area were purchased by a for-profit system (Steward Health Care) and things seem to have changed for the worse at those facilities. They've been closing units and laying off staff with what seems like increased frequency since they took over. Many of the hospitals they purchased were already unionized and remain so. Here's an article with their CEO talking about how they wish they could lay off their most experienced/most expensive staff to save money: Steward Health Care CEO: Layoffs are needed to reduce costs in health care industry - Boston Business Journal

Wow. Thanks for that link. That article makes me angry. When will corporations learn that it's not all about the bottom line ? In the end, profit-driven industries will have only made the rich richer while the morale of the rest of us is in the gutter. They will have made their millions (oh, lets be honest- BILLIONS) at the expense of not only those who've worked for them, but those poor souls, the patients who were entrusted into their care. I'm so effing sick of the dollar being the far-flung top if not only motivator for companies. Of course, profits matter. But morality, ethics, and the betterment of society as a WHOLE should be up there at the top of the list as well, in my humble opinion:)

OC_An Khe · Dec 1, 2013

The main legal difference between for profit and non profit is that the for profit pays taxes while the non profit does not. Both types of facilities must make a profit or they can't stay open in the long term. Each type of facility can place the same or different emphasis on profit or patient care as a priority.

Esme12, ASN, BSN, RN · Dec 1, 2013

They are at the end of their agreement with the state of MA and the CEO has his $6 MILLION, that's $SIX MILLION!! dollar home up for sale. Yet he talks about the facilities loosing money crying poor mouth..... he talks of closing, staff cuts and service reduction......how about a salary cut Dr. Ralph de la Torre????

Here is the problem with healthcare! Is one man really worth the kind of money that buys a $6 million dollar home? Then they want to talk about cuts in reimbursements? Makes me sick. Steward chief Ralph de la Torre builds empire, but not profits - Business - The Boston Globe

Esme12, ASN, BSN, RN · Dec 1, 2013

Thanks, KelRN215. I know what "For Profit" means. I was just asking if anyone noticed a measurable difference in their working conditions at a publicly traded company vs. a non-profit one...? And is there so much of a difference that I should avoid working for "For Profit" companies?

I think for profits are more "profit driven". The force a cut on supplies and run things close ot the bone. They spend very little on equipment and update where not for profits have to set aside a certain amount of money each year for these kind of upgrades.

They both end up paying the government for taxes and receive profits....it how they use those profits that make the difference. Fro profits are top heavy on salary of CEO's and spend little on improvement (in my experience) Not for profits pay their CEOs well but a certain portion of their profits must be used for improvement of the facility to maintain their status of not paying taxes. Both have to "pay" a certain amount .....it's where that money goes that makes the difference.

KelRN215, BSN, RN · Dec 1, 2013

The main legal difference between for profit and non profit is that the for profit pays taxes while the non profit does not. Both types of facilities must make a profit or they can't stay open in the long term. Each type of facility can place the same or different emphasis on profit or patient care as a priority.

Well the difference is also what they do with these profits. For profit institutions have share holders so when they make a profit, who benefits? Not-for-profit institutions need to invest their profit back into the institution, not divide it up amongst share holders. My not-for-profit hospital occasionally gave all staff bonuses (small ones, like $200) at the end of the fiscal year if they had a good business year. (Of course the CEO also got his six figure bonus but that happens in both kinds of facilities.)

Pudnluv, ASN, RN · Dec 1, 2013

Today the county run nursing home in my area became privatized. The new owners want to turn the facility around to make a profit. The way they state they will do this.....cut benefits to workers. No more paying into the state retirement system, retired workers will no longer get health benefits and the health insurance premiums will double. This facility also has a union. Problem is, the union contract is with the old facility, not the new owners.

The way I see it (and I'm no business major), the best way to make a profit is to have a good product. You can't build a car with only 3 people on the line and 50 managers running the place. Same thing in health care. You can't cut direct patient care staff and expect to deliver good health care. Most corporations are top heavy. If they cut just 3 of these "top heavy" positions, they could probably hire and extra 5-6 new nurses. This translates to higher quality care which translates to more people recommending your facility which in turn leads to higher profits. It really isn't rocket science.

elkpark · Dec 2, 2013

The main legal difference between for profit and non profit is that the for profit pays taxes while the non profit does not.

That's not true. Of course, nonprofit companies/facilities have to take in more money than they spend each year, or they go out of business. However, for-profit companies are required by law to produce the maximum profits they possibly can for their shareholders in whatever legal ways they can. If they don't do this, the board members and top executives can be sued by their shareholders. In health care, that means charging people as much money as possible for their services, and spending as little money as possible on the care provided. Although it may not be immediately apparent to the average person walking into the hospital, a for-profit hospital's first priority is to turn the biggest profit it can for its shareholders. The quality and quantity of the care provided comes second (or farther down the list) to that.

I worked for several years as a hospital surveyor for my state and CMS a while back, and my fellow surveyors and I found that we could tell very shortly into a survey whether a facility was for-profit or nonprofit. The for-profit facilities cut every corner they possibly could (sometimes to a ridiculous and potentially dangerous degree) and squeezed each nickel until it screamed.

I'm certainly not suggesting that all nonprofit places are wonderful places to work and receive care; but there is a big difference between these two types of facilities in their basic philosphies and values. Personally, I object on principle to the idea of for-profit healthcare, and would go hungry before I'd work for a for-profit organization.