Difference Between Profit and Nonprofit Hospice
The biggest difference is that non-profit hospices are not required to pay taxes to state or federal governments on the funds they receive from Medicare. Tax exemption is a standard of all non-profits. While both care for patients facing serious illness, for-profit corporations make money and pay dividends, while non-profits fulfill a compassionate mission. Nonprofit hospice patients received nearly three times as many physician visits per patient day than for-profit hospices.
For-profit hospices have higher margins and spend more on advertising than nonprofits. Nonprofits spend more per day for direct patient care than for-profits. The live discharge rate is higher for for-profits, which may indicate patients are pushed out when care becomes expensive.
Influence of Profit Generation on Healthcare Decisions
While both aim to deliver quality care, profit generation influences how for-profits make decisions about offerings and resources. The number of for-profit hospitals grows yearly. More nonprofits explore transitions to for-profit models. Nonprofits rely on donors, investments, and community funding to provide care. They pay no property, income, or sales taxes. What they don’t spend must go toward their mission.
Difference Between For-Profit and Not-For-Profit
At face value, the term "for-profit" suggests a company seeking to make money, while "not-for-profit" suggests a company that doesn’t make money. One main difference is taxation – for-profits pay taxes, not-for-profits don’t. For-profits distribute profits to owners and shareholders. Not-for-profits use revenues to serve their mission, transferring surplus funds to community efforts. Governance differs as well, with profit organizations focused on profitability and not-for-profits on mission compliance and community involvement.