Original Articles: PDF OnlyMcCue Michael J. DBAMedical Care: August 1990 - p 672-680 Buy Abstract Using California hospital data, this study examined the extent to which capital leases displace debt in the hospital industry. Moreover, it analyzed how hospital and financial variables affect utilization of lease financing. In contrast to the theoretic belief that lease financing displaces debt financing, the results showed a greater use of debt with leases. The study also found smaller, free-standing facilities with a greater investment in plant and equipment employed the lease option. © Lippincott-Raven Publishers.