Cambridge Quarterly of Healthcare Ethics



SPECIAL SECTION: ISSUES IN ORGANIZATION ETHICS AND HEALTHCARE

Business Ethics, Stakeholder Theory, and the Ethics of Healthcare Organizations


PATRICIA H.  WERHANE a1
a1 Patricia H. Werhane, Ph.D., is the Ruffin Professor of Business Ethics and Senior Fellow at the Olsson Center for Applied Ethics at the Darden Graduate School of Business Administration, University of Virginia

Abstract

Until recently (before managed care), business issues in healthcare organizations (HCOs) were relatively insulated from clinical issues, for several reasons. The hospital at earlier stages of its development operated on a combination of charitable and equitable premises, allowing for providing care to be separated from financial support. Physicians, who were primarily responsible for clinical care, constituted an independent power nexus within the hospital and were governed by their own professional codes of ethics. In exchange for a great deal of control over their conditions of practice, they took almost complete responsibility for patient care. Thus clinical and professional ethics could to some extent be compartmentalized from the business issues—a much easier feat when, as in much of the last few decades, virtually all care was reimbursed from some source or other. In addition, many HCOs were not categorized or treated as businesses, although of course they were presumed to be governed by the same expectation for good management as any other organization.



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