Rates of Return from Hospital Conversions

Health Care Management Review--April/June 2003
Vol. 28, No. 2
April/June 2003
Sloan, F.A., Conover, C.J., and J. Ostermann
pp. 107-17

This article presents information on the rates of return obtained by purchasers of U.S. hospitals since the mid 1980s. The key hypothesis tested in this study was whether for-profit acquirers are able to purchase hospitals at below-market prices. The researchers test the hypothesis by comparing internal rates of return to an estimate of the weighted cost of capital for all for-profit hospitals in the year the transaction occurred.

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