Determining the difference in hospital leadership style in relationship to tax status

Every business is dependent on a positive profit margin to survive. The healthcare industry in the United States is no different from any other business, except that some of its members are granted a tax-exempt status, based on member services to their communities. The healthcare industry is experiencing a decrease in non-profit facilities as a result of their failing financial status, while for-profit facilities are maintaining or even expanding their profit margins. Americans are experiencing difficulties in accessing healthcare as local non-profit hospitals close or convert to for-profit status and eliminate unprofitable healthcare service lines. The purpose of the descriptive quantitative research study was to see what difference exists between leadership practices in medium-sized, acute-care hospitals in the United States and how these leadership differences relate to the tax status of these facilities. The tax status of for-profit and non-profit, medium-sized, acute-care facilities in the United States was compared to their Chief Executive Officers' leadership styles. Data from the Multifactor Leadership Questionnaire revealed that the average Idealized Influence (Behavior) score is statistically significantly larger for nonprofit hospitals than in for-profit hospitals. Avolio and Bass (2004b) relate Idealized Influence (Behavior) to the transformational style of leadership. Data from the Multifactor Leadership Questionnaire additionally showed that the average Management-By-Exception (Active) score is statistically significantly smaller for non-profit than in for-profit hospitals. Avolio and Bass (2004b) relate Management by Exception (Active) to the transactional style of leadership.