ПРИЛОЖЕНИЕ НА МОДЕЛ НА АЛТМАН ЗА ОЦЕНКА НА РИСКА ОТ НЕСЪСТОЯТЕЛНОСТ И ФИНАНСОВА (НЕ)СТАБИЛНОСТ НА БОЛНИЦИТЕ В БЪЛГАРИЯ
APPLYING ALTMAN Z-SCORE ANALYSIS FOR ASSESSING THE FINANCIAL STRENGTH, AND THE RISK OF INSOLVENCY OF BULGARIAN HOSPITALS

Summary/Abstract: The financial stability of the hospitals is an essential prerequisite for their sustainable development and a warrant for the continuous execution of their socially significant role. Thus, research aimed at assessing hospitals' financial strength could drive well-informed preventive policy measures to increase our health system's resilience. In this study, we apply a modified Altman Z-score model to assess the degree of financial stability of thirty-one state-owned hospitals. The sample includes the hospitals that have generated the highest income from contracts with the NHIF in 2020. The hospitals with Altman Z-score over 3, we define as ones in good financial condition. Hospitals with a value between 1.81 and 3 are classified as relatively stable financially or fall into the so-called "grey area" of financial stability. Those with a Z-score below 1.8 are classified as having a problematic financial condition or experiencing financial distress. We also applied two other applicable methods for assessing the financial condition of hospitals to affirm the results from the application of the Z-score model. The results show that only 42% (n=13) of the hospitals in the sample are in stable financial condition. 29% (n=9) of hospitals fall into the grey area and have relatively stable financial conditions, and 29% (n=9) are in difficult financial conditions and are experiencing financial distress. These results essentially correspond to the control models, which concludes that the modified Altman Z-score model is applicable as an integral indicator for assessing the financial stability of hospitals in Bulgaria. The results suggest that less than 50% of the biggest by revenue, state-owned hospitals are robust financially, raising our concern. This indicates the need for additional research to thoroughly assess Bulgarian hospitals' financial condition.

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