Hospitals represented a growing $371.7 billion industry in the United States in 1997 and were responsible at that time for about 34% of the nation's health care expenditures. In 1999, the total portion of U.S. national health expenditures devoted to hospital care was estimated to have reached $401.3 billion.
There are several types of hospitals: acute care (i.e., defined to be those hospitals with average lengths of stay less than 30 days); psychiatric hospitals; chronic rehabilitation; nursing homes; and Federal (e.g., Veterans Administration Hospitals). The major issues linked to the entire hospital industry may be summarized as access or availability, costs, and (broadly defined) quality of care. The effective management of each involves operations research and management science. The key issues and trends that are associated with these concepts are as follows.
In 1965, two government-sponsored health insurance plans were created in the United States, Medicare and Medicaid....
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