Secondary Logo

Journal Logo

Special Theme Article

The Role of U.S. Public Hospitals in Urban Health

Anderson, Ron J. MD; Boumbulian, Paul J. DPA, MPH; Pickens, S Sue MEd

Author Information
  • Free


Today, in many metropolitan communities in the United States, public hospitals maintain the health care safety net. In this article, we define urban public hospitals as those owned by local governments or special authorities such as cities, counties, or special districts. In this definition, public hospitals have a governmental mandate to provide health care for the indigent and uninsured poor in their communities. The Institute of Medicine's 2000 Report, America's Health Care Safety Net: Intact but Endangered, states that “by legal mandate or explicitly adopted mission, [public hospitals] maintain an ‘open door,’ offering patients access to services regardless of their ability to pay. … A substantial share of their patient mix is uninsured, Medicaid, and other vulnerable patients such as ethnic minorities.”1 These public hospitals contrast with not-for-profit institutions whose missions direct them to provide care to the indigent and vulnerable populations, but whose financial viability requires them to also focus on margin.

As safety-net institutions, most urban public hospitals have evolved to not only provide indigent care but also to serve their communities by providing tertiary services such as trauma and those that support homeland security; serving as the foundation for primary care clinic systems with multiple sites, each seeing a high volume of patients; continuing to train a significant number of physician, nurses, and other medical personnel; and providing laboratories for clinical medical research.

In addition to these key services, many urban public hospitals have taken leadership roles in improving the health and well-being of the residents in their communities. This leadership role goes beyond the core services listed above to include “managing the in-between”—partnering with other governmental and nongovernmental entities to identify and work together on common health- and safety-related issues.

Stages in the Evolution of U.S. Urban Public Hospitals

Urban public hospitals have not always performed the roles described above. As Harry Dowling states in his book City Hospitals, public hospitals in the United States have transitioned through four stages. The first stage was the “poorhouse,” which lasted until near the end of the 20th century. During this period, hospitals were components of almshouses and medical care was considered subordinate to the almshouses’ social and welfare functions. Hospitals also cared for patients affected by epidemics and became known as “pest” houses.2

Dowling2 describes the second stage as the “practitioner period” when medical and nursing care became the focus of the urban public hospital. Physicians took time away from their private practices to see patients in an inpatient hospital setting. This period saw the beginning of formalized nursing services.

During the third stage or the “academic period,” urban public hospitals installed full-time medical staffs controlled by medical schools largely in response to the Flexner Report in 1910. As Dowling notes, “This period saw the organized instruction of medical students as part of the medical team, the flowering of hospital-based nursing schools, and the rise of collegiate schools of nursing.”2, p. 2 During the academic period, the United States was faced with major threats from infectious diseases: the influenza epidemic of 1918, the polio epidemic of the 1950s, and the threat of tuberculosis throughout the early part of the 20th century. At the same time, attempts were made to privatize public hospitals, but these attempts were always abandoned at the onset of major disease outbreaks.3

Dowling's final stage began in the mid 1960s and ended in 1980. This period was in many ways a “golden era” for U.S. medical schools when enrollments doubled. During this time there was a large investment of federal funds to build academic infrastructure for research, education, and patient care. Public hospitals, through their association with medical schools, benefited by becoming major postgraduate teaching and clinical research sites. Public hospital patients benefited from these associations by receiving access to leading-edge technology and medical care.2

However, this fourth stage was in many ways tumultuous. There were many changes in health care policy, including amendments to the Social Security Act that funded Medicare and Medicaid as well as other programs designed to improve the health and well-being of the public, such as comprehensive health planning and neighborhood health centers. The social structure of the United States changed, especially in the South. After racial desegregation and the passage of the Medicare and Medicaid Act in 1965, public hospitals became the major health care providers for the most poor Americans, many of whom were minorities.

Responding to these changes was very difficult for many urban public hospitals. They had to compete with not-for-profit and for-profit hospitals for newly funded, paying patients, such as Medicare patients. In addition, politically and legally, many public hospitals were literally under siege through protests and legal actions by the very people they served. Many of urban public hospitals learned from these experiences and began to work in partnership with their communities. Dowling states that “the emphasis began to shift from developing (city hospitals) urban public hospitals as academic medical centers to organizing them as leaders of health care for their communities.”2, p. 2 Since the 1980s, urban public hospitals have served multiple roles within their communities.

Urban Public Hospitals Today

Public hospitals play a significant role in providing inpatient and outpatient care in the United States. There are four primary sources of data on urban public hospitals: the National Association of Public Hospitals (NAPH), the Association of American Medical Colleges, the American Hospital Association (AHA), and University HealthSystem Consortium. All these data sources gather and aggregate data differently, making it difficult to specifically analyze data on urban public hospitals. However, the NAPH, which represents approximately 100 of the largest U.S. urban public hospitals, has analyzed and summarized the data provided by these organizations. According to the NAPH4:

American Hospital Association survey data shows that the average inpatient volume for [NAPH] hospitals (estimated using admissions) was more than double the volume at the average acute care hospital in the nation in 2000.

Urban public hospitals are also major providers of primary outpatient care. In 2001, 82 NAPH hospitals provided almost 31 million outpatient visits, with only 17% of these visits occurring in the emergency department. Almost half of the ambulatory visits (46%) were for primary care.4 In addition, the NAPH4 states:

Outpatient volumes increased dramatically between 1993 and 1999. In a matched set of 87 members, the volume of outpatient visits increased by over 21 percent from (an average of) 258,186 visits in 1993 to (an average of) 313,259 visits in 1999.

Urban public hospitals are also a major provider of care for the uninsured. In 2001 NAPH members provided 25% of all uncompensated care, even though they represented only 2% of the hospitals in the United States.5 Uncompensated care for a hospital is considered charity care and bad debt. Charity care is care provided to income-eligible patients regardless of the patients’ ability to pay. Bad debt is the unpaid portion of patients’ bills that the patients are not willing to pay.

However, not all urban public hospitals are similar. The NAPH aggregates data for its member hospitals regardless of the hospital's size or type of services. A few institutions, however, provide significantly more services than do the majority of public hospitals, such as the following examples: Parkland Health & Hospital System in Dallas, Texas; Los Angeles County–University of Southern California Healthcare Network in Los Angeles, California; San Francisco General Hospital in San Francisco, California; Jackson Memorial Hospital in Miami, Florida; John H. Stroger Jr. Hospital of Cook County in Chicago, Illinois; Denver Health in Denver, Colorado; Grady Health System, in Atlanta, Georgia; and the Elmhurst Hospital Center and Kings County Hospital in the New York City Health and Hospital Corporation (NYCHHC). While many public hospitals are part of multihospital systems, these flagship hospitals provide significantly more services than do other system hospitals. Table 1 shows the dramatic differences among the average NAPH hospital and these large public hospitals that are also NAPH members. In 2001, the number of discharges ranged from 16,496 at San Francisco General Hospital to 57,011 at Jackson Memorial Hospital. That same year, the number of outpatient visits ranged from 558,715 at Jackson Memorial Hospital to 1,060,028 at John H. Stroger Jr. Hospital of Cook County. While some of these hospitals had a number of discharges similar to the NAPH average, their outpatient volume was significantly higher than that for the average NAPH hospital. The number of births ranged from a low of 1,240 at John H. Stroger Jr. Hospital of Cook County to a high of 16,353 at Parkland Memorial Hospital.5

Table 1
Table 1:
Sample of Large Safety-Net (Public) Hospitals in U.S. Urban Communities, 2001

Table 2 shows uncompensated care as a percentage of total charges for several large NAPH institutions. The percentage of uncompensated care to total costs ranges from 12% at Elmhurst Hospital Center to 47% at John H. Stroger Jr. Hospital of Cook County and Los Angeles County–University of Southern California Healthcare Network. Medicaid no longer covers the cost of uncompensated care in hospitals that provide a large amount of uncompensated care. In 2001, 54% of NAPH hospitals lost money on Medicaid, even with disproportionate share funding included.5

Table 2
Table 2:
Uncompensated Care as a Percentage of Total Costs for Selected U.S. Hospitals, 2001

The majority of doctors (71%) in the American College of Emergency Physician survey said uninsured patients seen in the emergency room tended to be sicker and had more serious medical conditions than did patients with health insurance.6 Uninsured patients typically delay getting help for conditions that might have been cured or minimized with early intervention.6

As the NAPH5 notes, large patient volumes at NAPH hospitals afford great opportunities to train the nations physicians and allied health professionals:

… NAPH members play a central role in the training of the nation's physicians and allied health professionals. Eighty percent of NAPH acute care hospitals are teaching institutions. Fifty percent are classified as academic medical centers which is defined as having four or more approved residency programs. In 2001, NAPH members trained … fifteen percent of the doctors and ten percent of allied health. … In 2001, NAPH members trained 31 percent of the medical and dental residents … in the markets in which they are located.

In addition to providing sites for care and health professional training, urban public hospitals are where medical research is conducted. Researchers at U.S. medical schools and their affiliated teaching hospitals are responsible for many of the medical breakthroughs of the last century and conduct more than half of all clinical research sponsored by the National Institutes of Health.7 From new approaches in prevention and diagnosis to successful treatments and cures, research advances pioneered at these institutions dramatically improve the health of our nation.

In “Centers of Excellence: Research-Based Design for Discovery and Cure,” the author writes that many teaching and public hospitals, in partnership with their medical schools, have developed unique services for their community. According to the article, “These centers of excellence have been developed to create an optimal environment that benefits clinicians, researchers, staff members, patients, and their families.”8 In addition to centers of excellence, many urban public hospitals and medical schools have focused on essential services that are vital to the safety and welfare of their communities. In 2001, NAPH hospitals represented 40% of all Level I trauma centers in their markets. Also, they provided 22% of emergency room visits, 49% of burn care beds, 26% of neonatal intensive care beds, and 25% of inpatient psychiatric beds in their markets.9

From Medical Care to Health Improvement

While still fulfilling their service, research, and academic roles, many urban public hospitals have partnered with their communities. These partnerships are directed at enhancing the health and well-being of their community members. Because of fiscal constraints, many public hospitals have engaged in such partnerships to reduce demand through prevention by focusing on the determinants of health: social, environmental, economic, and genetic factors that contribute to health status.

Seeking to improve their communities’ health has required public hospitals to look outside of their own walls to the community. To encourage this outreach, the AHA established the Foster McGaw Prize, the hospital industry's highest award for community service. Criteria for winning a Foster McGaw Prize include leadership, commitment, partnerships, breadth and depth of initiatives, and community involvement including high community response to, acceptance of, and participation in the organization's community service initiatives.10 Over the last 18 years, ten public hospitals and five large urban hospitals have been awarded the prize. The five urban hospital prizewinners were Los Angeles County–University of Southern California Healthcare Network; Phoebe Putney Memorial Hospital in Albany, Georgia; Parkland Health & Hospital System; Cambridge Health Alliance in Cambridge, Massachusetts; and MetroHealth System in Cleveland, Ohio.

These large urban hospitals and heath systems have distinguished themselves with extraordinary efforts in the communities they serve. Following are some of these hospitals’ award-winning programs:

  • The teen pregnancy program (Network of Trust) at Phoebe Putney has reduced the high rate of teen pregnancies in Albany, Georgia, increasing high school graduation rates from 50% to 75% for program participants.11
  • Asthma programs at Los Angeles County–University of Southern California Healthcare Network have reduced emergency room visits related to child asthma by 18%.12
  • Parkland Health & Hospital System's Community Oriented Primary Care health center program established nine health centers throughout Dallas County, Texas.
  • Parkland Health & Hospital System's prenatal care program provided prenatal care to over 111,000 women in 2002 in clinics located throughout Dallas County, Texas. Roughly 96% of pregnant patients received prenatal care in 2002. Parkland stillborn and neonatal death outcomes for patients receiving prenatal care are impressive. From 1998–2002, for patients not receiving prenatal care, there were 13.0 stillborn per 1,000 live births compared to patients who had received at least one prenatal visit of 5.6 stillborn per 1,000 live births. Neonatal deaths (based on all infants) were 11.4 per 1,000 live births for patients not receiving prenatal care and 3.7 per 1,000 live births for patients who had received at least one prenatal visit.13
  • Cambridge Health Alliance's pediatric asthma program has reduced local hospitalization rates for asthmatic children from 5% (the national average) to 2%.14
  • The Cambridge Health Alliance's Domestic Violence Free Zone program has trained more than 1,300 city employees to recognize and intervene when they detect family violence. The initiative has also increased the number of programs available for children who witness violence.15
  • MetroHealth's Child and Family Health Services program has served 13,873 children and provided 29,037 clinic visits. They provided care to 1,809 women resulting in 7,986 prenatal visits in their fiscal year 2004.16

These programs are just some examples of public hospitals’ contributions to the health of their communities. Some urban public hospitals go beyond the development of special community programs and provide public health services in their communities. Many public hospitals and health systems run local public health departments in several major cities across the United States, including Cambridge, Massachusetts; Denver, Colorado; Martinez, California; Chicago, Illinois; and Los Angeles and San Francisco, California.5

These examples demonstrate that public hospitals are becoming an integral part of their communities by creating programs to improve community health. Public hospitals are maintaining a dialogue and developing partnerships with their communities to address health issues such as injury prevention, domestic violence prevention and intervention, environmental health, infant brain development, and adult literacy.

The Current State of Urban Public Hospitals

With declining revenues and the need to serve an increasing number of uninsured patients, many public hospitals have developed and implemented prevention strategies as a means of reducing inpatient demand for services. These strategies have focused on the determinants of health. Canadian researchers Evans and Stoddart17 examined the health of populations and communities and found that in order to have a significant impact on a community's health, interventions must focus on the key determinants: the physical and social environments, our genetic endowment, and how each individual responds to these determinants, physical (biological) and behavioral (lifestyle). Health care can moderate the effects of the determinants of health through improvement in the activities of daily living, but health care's contribution to the prevention of premature death is only about 10%, whereas social environment contributes 50%, genetic endowment 20%, and physical environment 20%.3,18

The Financial Difficulties of Urban Public Hospitals: Issues and Solutions


The impact of federal cuts such as those in the Balanced Budget Act of 1997, more recent state budget deficits, competition for Medicaid managed care, and the growth in the number of uninsured have led to a decline in revenues among urban public hospitals. The financial situation worsened after September 11, 2001, and the subsequent economic downturn in which large numbers of unemployed lost employer-sponsored health insurance. The economic downturn also thrust many state governments into economic deficits. Across the nation, states strapped for resources have aggressively cut health care funding. For example, the Texas legislature alone, facing a $10 billion deficit in fiscal year 2003, balanced the budget by reducing funding for Medicaid, the State Children's Health Insurance Program (SCHIP), graduate medical education, and higher education. Reduced eligibility for Medicaid and SCHIP has resulted in 8,300 pregnant women losing their coverage per month, 1,500 chronically ill children on a waiting lists for coverage, and adult Medicaid beneficiaries losing coverage for mental health counseling, eyeglasses, and hearing aids. Additionally, since September 2003, 132,200 children have been dropped from the SCHIP roles. As a result, Texas has left $1.6 billion matching federal dollars on the table.19,20 It is clear that the federal and state governments have been reducing resources for health care; it has been left to local governments and institutions, among them public hospitals, to provide for the uninsured. Many local governments have responded by refusing to increase the tax burden on local residents and businesses already facing economic stress. As the NAPH21 has noted, “In response, many public hospitals have developed aggressive strategies to compete, such as reducing costs and marketing their services in order to retain their traditional market share, as well as to attract new ‘paying’ patients.” However, most public hospitals are close to full occupancy and therefore find it difficult to compete for new paying patients.

In addition, according to NAPH, industry experts state that access to capital for new services and the construction of new facilities will become increasingly difficult for public and not-for-profit hospitals in the short-term. Decreasing margins throughout the hospital industry, and particularly among safety-net hospitals, have resulted in increased difficulty issuing bonds. As public hospitals struggle to remain viable in the face of mounting financial pressures, upgrading facilities to be able to compete for paying patients becomes more difficult.22

As public hospitals serve more uninsured patients, the relationship of public hospitals to other hospitals in the community becomes clearer. If public hospitals cannot handle the volume of uninsured, these patients will use other hospitals, which will result in decreased access for insured patients as well as declining hospital margins. This situation compromises not-for-profit and for-profit facilities, financially and clinically. In response to the financial and patient volume constraints, public hospitals have been forced to ration care by queuing and erecting barriers to access.

However, urban public hospitals have the services to provide care to diverse patient populations. Parkland's patients speak over 54 different languages or dialects. Many NAPH hospitals provide medical translation for more than 50 languages. Nationally, 54% of patients at NAPH hospitals are members of racial and ethnic minorities. In addition, these hospitals have learned and grown in their cultural competency and their ability to manage the care of their vulnerable patients.22 They have also begun to learn to correct some for the disparities documented for ethnically diverse populations, such as higher infant mortality rates and high complications rates for diabetes among African Americans.


Creating a community that is healthy, safe and a good place to live, work and play depends on the public and private infrastructure. This interdependence, or the “in-between,” is the common ground between disparate organizations and communities’ social and economic infrastructure. When a community provides leadership and accountability by managing the interrelations among and between its various organizational infrastructural assets, community health and quality of life can be markedly improved. For example, in the United States, an individual's educational level correlates to his or her health status.18 Encouraging students not to drop out of high school, therefore, can eventually improve community health. The community benefits by coordinating its assets such as the education systems, housing, security, transportation, economic development, and public health's collective contributions to the community's health.3

Urban public hospitals, in order to be successful in the next stage of their evolution, need to learn to manage the “in-betweens.” This requires dialogue among the various segments of society. It also requires willingness to put aside the “expert's mantel” and humbly seek to serve others. Deep listening, dialogue instead of debate, and getting the facts together before jumping to the fix-it solution is wise and builds trust. Ultimately this work is based on relationships.23

Urban public hospitals are strategically placed to partner with their communities for needed change. John McKnight,24 author of The Careless Society, has written that change occurs through the community's strengths and assets, not through the community's deficits. An asset-based approach calls on institutions to look closely at what resources they possess before seeking new resources. Solutions come from the residents of communities in partnership with their institutions. Leading-edge urban public hospitals have begun to work with and learn from such partnerships with community assets, such as faith-based organizations; they have much in common.

Medical education has primarily focused on what goes on inside the walls of the hospital. This perspective needs to be expanded through outcomes research in population health. Public hospitals can serve and have served as vehicles for clinical, community, and population-based research. This role can be expanded to cover applied clinical research, community-based research on the determinants of health, health disparities, health policy, chronic disease management, outcomes research, and preventive medicine. Public hospitals better understand the interrelatedness of education, housing, jobs, pollution, public safety, and health. Public hospitals also see the need to look at denominator issues (populations) as well as numerator issues (enrollees), and as such are better community laboratories than HMOs, which are numerator-driven models (i.e., individuals are covered rather than the community as a whole).

Advances in information systems technology can provide the infrastructure to help us with the task of outcomes research and will provide the basis to improve quality, increase accountability, and assist individuals with the ability to provide self-care for chronic disease management.

Institutions that have often achieved excellence in medicine, medical education, and research now need to enter into the community where they are no longer the experts. They have to risk being the student and give up command and control and share resources to build a new accountability with the community. If we engage the community successfully in this relationship, building trust and establishing new capability and capacity, such as community responsive care, urban public hospitals will survive, evolve, and continue their tradition of service. The complexity of their challenge in the future will not lessen, for that is the nature of community. Urban public hospitals need to be flexible, learning organizations open to constant change. They have adapted before and must again. They clearly have the mission and talent to do so with their academic partners. Their academic partners must be committed to mutual success and hope they too will enter and learn from community.


1.Lewin M, Altman S (eds). American's Health Care Safety Net: Intact but Endangered 〈〉. Accessed 1 May 2004. Institute of Medicine, Washington, DC, March 2000.
2.Dowling H. City Hospitals. Cambridge: Harvard University Press, 1982.
3.McGinnis JM, Foege WH. Actual causes of death in the United States. JAMA. 1993;270:2207–12.
4.National Association of Public Hospitals. How much outpatient care do safety net hospitals provide? NAPH Issue Brief, September 2003 〈〉. Accessed 2 September 2004.
5.Singer I, Davison L, Fagnani L. America's Safety Net: Hospitals and Health Systems, 2001. Results of the 2001 Annual NAPH Member Survey 〈〉. Accessed 2 September 2004. National Association of Public Hospitals and Health Systems, Washington, DC, September 2003.
6.American College of Emergency Physicians. Report from the front lines: emergency physicians say uninsured patients live sicker, die younger. March 12, 2003 〈〉. Accessed 27 August 2004.
7.Association of American Medical Colleges. Changes in U.S. Medical Schools NIH Rankings, 1991-2000 〈〉. Accessed 27 August 2004. Analysis In Brief. September 2001;1(3).
8.Bishop JL. Centers of excellence: research-based design for discovery and cure 〈 or〉. Accessed 15 May 2004. American Institute of Architects, Washington, DC.
9.NAPH Issue Brief. What specialized services do safety net hospitals provide to their communities? September 2003 〈〉. Accessed 15 May 2004.
10.Phoebe Putney Memorial Hospitals. The Foster G. McGaw Prize 〈〉. Accessed 20 August 2004.
11.Phoebe Putney Memorial Hospitals. Network of trust 〈〉. Accessed 15 May 2003.
12.Los Angeles County + University of Southern California Healthcare Network receives prestigious Foster G. McGaw Prize. Chicago: PRNewswire, December 21, 1999.
13.Parkland Health & Hospital System [unpublished internal data]. Dallas, Texas, 1999–2001.
14.Burrows J. Cambridge Health Alliance observes World Asthma Day [press release] 〈〉. Accessed 30 August 2004. Cambridge Health Alliance, Cambridge, Massachusetts.
15.Cambridge Health Alliance. Community Connections Page 〈〉. Accessed 20 August 2004.
16.Barbara Riley, general manager, Public Health Programs, MetroHealth Center for Community Health, Cleveland, Ohio. Personal Communication, August 30, 2004.
17.Evans RG, Stoddart GL. Producing health, consuming health care. Soc Sci Med. 1990;31:1247–1363.
18.Marmot MG. Improvement of social environment to improve health. Geoffrey Rose memorial lecture. Lancet. 1998;351:57–60.
19.Kaiser Daily Health Policy Report. Texas State House Democrats Urge Restoration of SCHIP, Medicaid Funding. Friday, October 02, 2003 〈〉. Accessed 20 August 2004.
20.Carole Keeton Strayhorn, Texas comptroller, State of Texas. Personal Communication, May 31, 2004.
21.Do safety net hospitals have to compete for patients like other hospitals? NAPH Issue Brief, November, 2003 〈〉. Accessed 20 August 2004.
22.What kinds of patients go to safety net hospitals? NAPH Issue Brief, September 2003 〈〉. Accessed 20 August 2004.
23.Gladwell M. The Tipping Point: How Little Things Can Make a Big Difference. Boston: Little Brown and Company, 2002.
24.McKnight J. The Careless Society: Community and Its Counterfeits. New York: BasicBooks, 1995.
© 2004 Association of American Medical Colleges