The profits of not-for-profit hospitals

This paper explores the profits of not-for-profit (NFP) hospitals and identifies the factors that determine whether such profits are adequate. A model which relates hospital charges to surpluses is used to derive NFP surplus from gross patient charges and operating costs. This is done to identify the items contributing to surpluses and to explore the dispersion of NFP surpluses. We first discuss why the literature is relatively silent on NFP profitability. We then present the model and use Tennessee hospital data to identify how its components vary by hospital type and through time. The dispersion of surpluses among NFPs is then examined. We next propose three rate of return measures of profitability and use these to relate NFP profits to select characteristics of hospitals and their environments. Several alternative profit levels of NFP are discussed, and the factors that are relevant to the issue of determining the adequate level of profit are identified. The paper ends with a plea for better data on NFP profits.     

Rational lobbying and EU climate policy

Using a simple rational choice model as a heuristic device, this paper explores the lobbying behaviour of environmental and business organisations in the field of climate policy and discusses why their lobbying behaviour differs. I find that environmental organisations lobby less than what would be considered rational according to the simple rational choice model, and argue that this might largely be explained by tight budget constraints. I also find that business organisations lobby more than what would be considered rational according to the model, and argue that this might be explained if one applies a long-term perspective on rational lobbying in the policy field rather than a short-term perspective on single policy decisions. Moreover, I find that the type of lobbying differs. While environmental organisations focus on single policy decisions, business organisations also invest in general lobbying. The analysis is based on interviews with interest organisations lobbying in the field of climate policy at the European Union (EU) level.

Federal Old-Age, Survivors, and Disability Insurance; revised medical criteria for the determination of disability--Social Security Administration. Proposed rules

These proposed amendments revise the medical evaluation criteria for both the title II and title XVI disability programs. These criteria were last revised in 1979. The proposed revisions reflect advances in the medical treatment of some conditions and in the methods of evaluating certain impairments. These proposals will provide up-to-date medical criteria for use in the evaluation of disability claims.     

Seeking rents through class actions and legislative lobbying: a comparison

This article analyzes class actions as a technology that groups may use in their rent-seeking activity, in addition to other rent-seeking methods such as legislative investment within the political market, when they seek to achieve favorable decisions from decision-makers—courts and legislators. It claims that groups may make their choice between various rent-seeking technologies according to their sensitivity to the problem of free riding. Therefore, it analyzes the effect of the legal instruments that facilitate class action lawsuits and collective litigation in most countries upon the rent-seeking strategies of groups, as compared to rent-seeking through legislation.     

The business judgment rule and other protections for the conduct of not-for-profit directors

The authors review the Business Judgment Rule as applied to a not-for-profit director's duty of care, with particular emphasis on the different forms of state statutory liability shields that serve to enhance the protections of the Rule. They also examine current trends in enforcement of breach of fiduciary duty of care standards, and provide a series of specific recommendations for not-for-profit boards to consider implementing as a means of increasing the likelihood of affording such protections to individuals serving as directors.     

A revised model of unilateral accidents

This paper suggests and justifies a revised formulation of the unilateral accident model based on relaxing two assumptions of the standard model: the precaution function and the harm function. The revised model is, therefore, more general and corresponds better to various situations. A resulting trait of the generalized model is its account for the interaction between the injurer’s care and activity levels, which was implicitly assumed away so far. The revised model is examined using a few standard issues in tort and the analysis brings new results and insights for the unilateral accident case. For example, the view that, under a negligence regime, due care can be defined regardless of the optimal level of activity holds under very restrictive assumptions. In general, due care must be defined simultaneously with the optimal activity level. In addition, the common view suggests that underestimation of the level of actual damages under strict liability would induce injurers to take insufficient care and to engage excessively in a risky activity (and vice versa, for overestimation). This paper shows that underestimation of actual damages may counter-intuitively lead to insufficient activity or excessive care levels. Similarly, the results of underestimating harm under a negligence regime prove to be different than commonly thought. In addition, the revised model questions the intuitive similarity between the underestimation of harm and the judgment-proof problem, and provides some new results for the latter problem.