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When establishing a health care organization there are choices of a private structure or public structure. Each option has its own unique advantages and challenges. When considering which one to choose, an organization must think about the government impacts of the health care organization, the community and the financial bottom line. The behaviors of the public sectors versus the private sectors are very different (Gouveia, 1996). The public sectors are challenged with relying on government decisions and other government support in order to run their business and the government has the decision in closing any of these facilities as well (Andrulis, 1997). One of the largest threats to the public sector is the government decline of support and the rise of the population that is utilizing government benefits (Andrulis, 1997). Private sectors can negotiate their rates with the insurance providers which gives them a step up from the government funding they receive (Gouveia, 1996).

References:

Andrulis, Dennis P. (1997) The Public Sector In Health Care: Evolution Or Dissolution?
https://doi.org/10.1377/hlthaff.16.4.131

Gouveia, M. Int Tax Public Finan (1996) 3: 329. https://doi.org/10.1007/BF00418948

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