Management Insights

This paper examines the relationships between patient volume, teaching mission, and process quality in U.S. hospitals. Using a large data set that measures process quality for treatments of heart attacks and heart failures in all major U.S. hospitals, the authors find that the impact of patient volume on process quality varies across hospitals with different teaching intensities. Their results suggest that when the complexities of large-scale operations coincide with the added burden of teaching and training functions, teaching hospitals tend to suffer a negative effect on their process quality. The managerial implications of this finding are twofold. First, because large volume hospitals do not always perform better than smaller ones, policy makers and hospital managers should re-evaluate the current practice of regionalization of hospitals services in light of the teaching intensity of the hospital to which services are being redirected. Secondly, while many hospitals define themselves as teaching hospitals and that new doctors must be taught, large teaching hospitals with high resident-to-bed ratios need to address the root causes of the lower quality scores they produced (compared to their smaller counterparts) in order to control quality more tightly.