The Interactive Effect of Physician–Hospital Organization and External Environment on Patient Satisfaction.

This article examines the impact of physician–hospital organizations (PHOs)—a hybrid joint venture governance structure between hospitals and independent physicians—on patient satisfaction in the U.S. health care industry. Using transaction cost analysis and a multiyear panel dataset of 19,134 hospital-year observations, the study finds that PHOs generally enhance patient satisfaction with hospital services, particularly in markets characterized by intense hospital competition, high mortality rates, urban settings, and elevated unemployment. The research highlights that PHOs mitigate performance uncertainty by fostering clinical integration, care coordination, and aligned incentives between hospitals and physicians, which in turn improves patient experience and indirectly increases patient recommendation of hospitals. These findings offer strategic insights for hospital administrators on when PHOs are most effective and contribute to the literature on governance structures, joint ventures, and customer satisfaction in health care.