Changes in Nonprofit Hospitals’ Finances, Operations, and Quality of Care After Using Management Consultants

How much do nonprofit hospitals spend on management consultants, and following the initiation of a management consulting contract, are there changes in hospital finances, operations, or quality of care?Nonprofit hospitals in the US (n = 2343) collectively spent more than $7.8 billion on management consulting services from 2009 to 2023. A stacked difference-in-differences design comparing 306 US nonprofit hospitals that used a management consulting firm for the first time with 513 matched hospitals that did not use a management consulting firm during the study period found little evidence of substantial, statistically significant, or systematic changes attributable to management consulting engagements.These findings raise questions about the net value that nonprofit hospitals receive from management consulting services and call for careful examination of these contracts.

Corresponding Author: Joseph Dov Bruch, PhD, Department of Public Health Sciences, University of Chicago, 5841 S Maryland Ave, Room W-250C, Chicago, IL 60637 (jbruch@bsd.uchicago.edu).

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