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 Hospital Economics
A Primer on Resource Allocation to
Improve Productivity & Sustainability
 Hospital Economics
A Primer on Resource Allocation to
Improve Productivity & Sustainability

A. Heri Iswanto

A PRODUC TIVIT Y PRESS BOOK

First published 2018
by Routledge
2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN
and by Routledge
711 Third Avenue, New York, NY 10017
Routledge is an imprint of the Taylor & Francis Group, an informa business
© 2018 by A. Heri Iswanto
The right of A. Heri Iswanto to be identified as author of this work has been
asserted by him in accordance with sections 77 and 78 of the Copyright,
Designs and Patents Act 1988.
All rights reserved. No part of this book may be reprinted or reproduced or
utilised in any form or by any electronic, mechanical, or other means, now
known or hereafter invented, including photocopying and recording, or in
any information storage or retrieval system, without permission in writing
from the publishers.
Trademark notice: Product or corporate names may be trademarks or
registered trademarks, and are used only for identification and explanation
without intent to infringe.
British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging-in-Publication Data
Names: Iswanto, A. Heri, 1977- author.
Title: Hospital economics : a primer on resource allocation to improve
productivity & sustainability / A. Heri Iswanto.
Description: Boca Raton : Taylor & Francis, 2018. | "A CRC title, part of the
Taylor & Francis imprint, a member of the Taylor & Francis Group, the
academic division of T&F Informa plc." | Includes bibliographical
references and index.
Identifiers: LCCN 2017051162| ISBN 9780815388777 (hardback : alk. paper) |
ISBN 9781351172523 (ebook)
Subjects: LCSH: Hospitals--Business management. | Hospitals--Administration.
Classification: LCC RA971.3 .I89 2018 | DDC 362.11068--dc23
LC record available at https://lccn.loc.gov/2017051162
ISBN: 978-0-815-38877-7 (hbk)
ISBN: 978-1-351-17252-3 (ebk)
Typeset in ITC Garamond Std Light
by Nova Techset Private Limited, Bengaluru & Chennai, India
 To my loving wife, Shika,
and our children, Naya and Farrel
Contents

Acknowledgments............................................................... xi
Author.................................................................................xiii
1 The Importance of Hospital Economics....................1
Introduction......................................................................... 1
Hospital Cost Savings.......................................................... 5
Ratio of Hospital Beds......................................................... 6
Hospital Economics Issues.................................................. 7
References............................................................................ 9
2 Hospital Resource Allocation.................................11
Introduction........................................................................11
Production Function...........................................................12
Cost Function......................................................................16
References...........................................................................19
3 Hospital Productivity..............................................21
Introduction........................................................................21
Hospital Productivity Factors.............................................25
References...........................................................................29
4 Hospital Competition and Quality..........................31
Introduction........................................................................31
Competition versus Quality................................................31
Nonfinancial Factors...........................................................33
References...........................................................................38

vii
viii ◾ Contents

5 Cost Components in Medical Procedures...............39

Introduction........................................................................39
Cost Elements.....................................................................40
Analysis of Covariance.......................................................43
References...........................................................................47
6 Economic Burden of Disease..................................49
Introduction........................................................................49
Perspectives on Study of the Economic Burden...............49
The Economic Burden of Disease.....................................51
Sociological Role.................................................................52
Stigma..................................................................................53
The Proportion of Direct and Indirect Costs.....................56
References...........................................................................56
7 Economical Aspects of Hospital-Acquired
Infections................................................................57
Introduction........................................................................57
Implementation of Work Standardization..........................58
Economic Analysis of Hospital-Acquired Infections.........59
Hospital Costs Spent...........................................................60
The Importance of Hospital-Acquired Infections.............61
Incremental Cost-Effectiveness Ratio.................................63
References.......................................................................... 64
8 Hospital Resource Management.............................67
Introduction........................................................................67
Technical Efficiency........................................................... 68
Economic Efficiency...........................................................69
Scale Efficiency...................................................................71
The Relation among Efficiencies........................................73
References...........................................................................75
9 Economy Scale of Hospitals....................................77
Introduction....................................................................... 77
Economy of Scale...............................................................78
Economy of Scope............................................................. 80
Application..........................................................................81
References...........................................................................85
 Contents ◾ ix

10 Hospital Human Resources Development...............87

Introduction........................................................................87
References...........................................................................93
11 Methods of Improving the Quality of the
Hospital..................................................................95
Introduction........................................................................95
Total Quality Management, Six Sigma, and Lean..............95
Plan, Do, Check, Act.......................................................... 99
The Seven Quality Control Tools.....................................100
References......................................................................... 101
12 Lean Implementation in Hospitals........................103
Introduction......................................................................103
Waste.................................................................................103
Lean Implementation........................................................104
Lean Principles..................................................................106
References......................................................................... 110
13 Utilization of Hospital Resources.........................113
Introduction...................................................................... 113
Consumer Rates................................................................ 115
Insurance........................................................................... 117
References......................................................................... 119
14 Hospital Revenue Components.............................121
Introduction......................................................................121
Payment-Based System.....................................................123
Hospital Revenue..............................................................123
References.........................................................................129
15 Diagnosis-Related Groups.....................................131
Introduction...................................................................... 131
Diagnosis-Related Groups in Indonesia..........................132
Indonesia Case Base Groups...........................................136
References.........................................................................138
Index...................................................................................141
Acknowledgments

I want to praise the Almighty, Allah, SWT, for the mercy and
blessings given so I could complete the book entitled Hospital
Economics.
I extend special thanks to the colleagues who always give
me motivation. My beloved wife, Shika Iswanto, who always
supports me. My dears, Kannaya and Alfarrel, who have been
waiting patiently and gave their time until the completion of
this book.
I realize that this book is still far from being perfect.
However, I have performed my best in presenting this book.
Therefore, suggestions and criticism are always welcome for
betterment. Finally, I hope that the book can be useful for
hospital practitioners, academics in general, and especially
those who want to conduct and perfect similar research.

xi
Author

A. Heri Iswanto completed his Doctorate of Economic

Science and Master and Bachelor in Hospital Management. As
Deputy Dean of Academics in the Faculty of Health Science,
University of Pembangunan National “Veteran” Jakarta, and
as a lecturer at other universities in Jakarta, he has been the
director at various hospitals including Prikasih, Lestari, and
Kemang Medical Care. He has been a speaker at conferences
and c­ onducted training in the United States, Taiwan (ROC),
IR Iran, Pakistan, Thailand, Malaysia, Singapore, Japan, China,
the Philippines, and Vietnam.

xiii
Chapter 1

The Importance of
Hospital Economics

Introduction
A health system in a country is a network that involves many
parties that are interconnected to one another. In a comprehen-
sive public health network, at least 23 organizations, each of
which has contributed to the costs and benefits generated by
public health, are involved. The institutions involved in a uni-
versal health care system include, among others (CDC, 2013: 49):

1. Schools. Schools play a role in providing knowledge and

training on health to the community to help people stay
healthy and avoid diseases, such as by providing informa-
tion on healthy lifestyles, especially to student groups in
the community. Some schools specifically focus on educa-
tion in the health field, such as nursing schools, medical
schools, and so on.
2. Mental health coaching institutions. Institutions such as
self-development centers, both religious and not, play a
role in maintaining good mental health in the community.
The majority of health problems can have their source in

1
2 ◾ Hospital Economics

mental problems (e.g., stress), and improvement in mental

health quality can help reduce health problems.
3. Governments. Governments, both at the national and
local levels, through the Ministry of Health and Health
Service or nonministry institutions such as the National
Agency of Drug and Food Control (BPOM), and even
government agencies that are not directly related to
health, have the role of regulation and supervision of
aspects of public health related to the tasks and functions
of each institution. For example, the Ministry of Housing
has the role of ensuring houses occupied by people meet
the standards of good health and do not cause disease
for the residents. Overall, the role of the government is
to build public health through health systems and part-
nerships with others in the health system through the
principles of equality, solidarity, and justice-based human
rights (WHO, 2006: 11).
4. Emergency medical services. These institutions include
the Indonesian Red Cross (PMI) and various agencies
of ambulance service providers that are able to respond
quickly when people need emergency health care but are
unable to reach the emergency room. These institutions
provide first aid and emergency response in terms of
housing, food, and health, including epidemic and mental
health, for families and the whole community, in particu-
lar the vulnerable community, in order to return to nor-
mality after a crisis.
5. Civilian groups. Civilian groups are public institutions
voluntarily established to provide health services in the
community, as well as in the form of fundraising, such as
cancer awareness groups, schizophrenia care groups, and
so forth. The World Health Organization (WHO) regis-
ters at least 15 roles of civilian groups in the health sec-
tor, including service providers, who build a large public
selection of health information, negotiate standards and
public health approaches, promote pro-poor concerns
 The Importance of Hospital Economics ◾ 3

and social equity in resource allocation, and super-

vise the responsiveness and quality of health services
(WHO, 2001: 6).
6. Home care. Home care includes various types of institu-
tions specializing in the treatment of specific groups in
the community. There are at least 15 types of institutions
that exist in the community: child sanatorium (barriers
to learning), day care (toddlers from 3 months to under
5 years), child care (fatherless/motherless children or
orphans who are underprivileged and homeless), bina
remaja (abandoned children dropping out of school),
nursing homes for elders (old/seniors), bina daksa (physi-
cally disabled, other physical problems, and orthope-
dics), bina netra (vision impairment), bina rungu/wicara
(speech defects/hearing impairment), bina grahita (mental
impairment), bina laras (deviant behavior from the norm/
ex-psychotic), bina pasca laras kronis (handicapped due
to chronic diseases), marsudi putra/putri (brat), pamardi
putra/i (former victims of drug abuse), karya wanita
(prostitute), and bina karya (homeless or abandoned
people) (Decree of Minister of Health No. 50/HUK/2004
on Social Institution Standardization and Social Institution
Accreditation Guidelines). Part of the responsibility of a
nursing home is to provide health care to the community
members in their care.
7. Association of physicians. This group, particularly the
Indonesian Doctors Association (IDI), is responsible for
the health of the Indonesian nation.
8. Law enforcement agencies. Both military and police and
other law enforcement agencies provide human security
in various forms; one of them is health.
9. Correctional facilities. These institutions have expertise
in teaching skills to people who break the law, including
expertise in the field of health. In addition, the correc-
tional facility has a role in the coaching of mental health
in prison.
4 ◾ Hospital Economics

10. Heads of state and local government are responsible for

providing shelter and managing various public areas,
including the health sector.
11. Emergency institutions such as Search and Rescue (SAR),
firefighters, the Indonesian National Board for Disaster
Management, Badan Penanggulangan Bencana Daerah
(BPBD) (Regional Disaster Management Agency), scouts,
and so on, have proficiency in the health sector and are
able to provide health assistance to the community.
12. The Neighborhood Association (TNA) and Community
Association (TCA) as well as other organizations, coach
the community in neighborhoods to be aware of various
aspects of life, including health.
13. Religious institutions educate people to maintain health
through the theories of the religion in which they believe.
14. Integrated service posts are at the center of basic health
­services for various strata of the community in the area.
15. Community health centers also become centers for ­primary
health care for various strata of the community in the area.
16. Employers/businesses, both health and nonhealth
­businesses, are involved in community health. In the
health sector, this includes pharmaceutical companies,
drug stores, pharmacies, insurance companies, and
­clinics, while in the nonhealth sector, it includes almost
all areas of business, which, of course, do not want the
human resources they have to get sick.
17. Youth and community organizations. Most of these orga-
nizations have health care for their members, and there
are some that focus on the public health.
18. Nonprofit organizations such as political parties, Badan
Penyelenggara Jaminan Sosial (BPJS: Social Security
Administering Body [SSAB]), and nongovernmental orga-
nizations (NGOs) have sections dedicated either entirely
to health or as an effort to encourage support for them.
Several political parties and NGOs have free ambulance
services or even their own hospital.
 The Importance of Hospital Economics ◾ 5

19. The household is a leader in health care; that is, for the
health of family members, at a minimum.
20. Hospitals provide a vital role in serving community mem-
bers to achieve recovery.
21. Treatment/rehabilitation centers play a role in ­recovery
from certain diseases or certain factors that cause disease,
such as drug addiction.
22. Laboratories are research and development centers for disease
prevention as well as diagnosis help centers, and so on.
23. Shamans and traditional medicine are health care provid-
ers based on local wisdom that is still widely used by the
community.

Of the 23 institutions listed above that play a role in public

health services, the hospital is the most recent, as well as the
one most in need of funds. In hospitals, there are expensive,
advanced technology and experts from various fields gathered
in one place to give the best curative services. Some poor
countries even spend more than half their national health
­budgets to manage their hospitals (WHO, 2001: 13).

Hospital Cost Savings

In line with this, it makes sense that the cost savings of hospi-
tals will have a greater impact than the cost savings from other
actors in the health network in a country. In addition, it is
very important to study hospital economics to solve economic
issues that focus on the hospital and create effects as opti-
mally as possible for universal public health, either directly or
indirectly through other institutions in the health care system
(Newbrander et al., 1992: 2).
Thus, efforts are being made to save on hospital costs. In
the United States in 1989, it is estimated that there was up to
40% waste in health budgets for hospitals. Small improvements
in the hospital management system in Malawi were able to
6 ◾ Hospital Economics

produce savings of up to 44% in the budget of the hospital

(Newbrander et al., 1992: 2). In Indonesia, a large budget is
given to hospitals, but no matter how much is given, it will all
run out (Kompas, July 6, 2015).

Ratio of Hospital Beds

Our look at hospital economics is not complete until we
look at the ratio of hospital beds to the population. This ratio
reflects the number of hospital beds per thousand people.
Indeed, there is no global norm for the density standard
of hospital beds to the population, but in the countries in
Europe, there are 6.3 beds per 1000 people.
The government itself suggests the ideal ratio is two beds
per thousand people (1:500) (Table 1.1). The countries with
the highest number of beds for 1000 people are Belarus,
Japan, and South Korea, with 11.3, 14, and 13.2 beds in 2009.
Meanwhile, in the same year, Indonesia had only 0.9 beds
per thousand people (WHO, 2009). Data from the Ministry of
Health are even lower, namely 0.690 beds per 1000 people.

Table 1.1 Beds per 1000 People in 2009 and 2013

Type of Total Beds per
Hospital Year Hospital Beds 1000 People
Public Hospital 2009 1202 141,603 594
2013 1725 245,340 987
Private Hospital 2009 321 22,877 96
2013 503 33,110 133
Total 2009 1523 164,480 690
2013 2228 278,450 1121
Total population in 2009 was 238,306,561, while in 2013, it was
248,456,215.
Source: Ministry of Health. 2014. Ministry of Health’s Strategic Plan
2015–2019.
 The Importance of Hospital Economics ◾ 7

In 2013, this ratio increased to 1.121 per 1000. This amount is

nonetheless still considered less than the ideal ratio.
In terms of any service preparedness, the hospitals in
Indonesia still have many problems. Data in 2011 show that
hospital patient admissions per 10,000 people is only 1.9%,
with a bed occupancy rate of only 65%. Comprehensive
­emergency obstetric care of hospitals in districts/cities has
reached 25%, while in government hospitals, it reached only
86%. Hospital blood transfusion capability is still low, with an
average readiness of 55%, based mainly on the adequacy of
new blood supplies by 41% in government hospitals and 13%
for private hospitals (Ministry of Health, 2014: 18).
On the other hand, there are still many private hospitals that
are reluctant to join the BPJS for economic reasons (Tribune
News, September 30, 2014). In fact, 53% of all hospitals in
Indonesia are private property (Ministry of Health, 2014: 17).
If the economy is used as an excuse, of course we can ask
what kind of economic considerations make hospitals decide
they lose if they participate in the BPJS. This in turn becomes
a topic for the field of hospital economics. Moreover, the
­benefits gained will allow BPJS to achieve universal coverage
and be served by hospitals as a whole without looking again
at the possibility of loss. In a more comprehensive manner,
the ­targets to be achieved are efficiency, equity, and sufficient
profit for hospitals.

Hospital Economics Issues

Let’s start considering the economic issues of hospitals by
examining resource issues. A resource issue in hospitals
­creates many problems, such as an excessive number of
patients, poor service quality, lack of diagnostic tools and
equipment, dirty and worn-out facilities, long queues at the
outpatient clinic, lack of drugs and other medical supplies,
low employee morale, and so on (Newbrander et al., 1992: 5).
8 ◾ Hospital Economics

Newbrander et al. mention three main resource issues in a

hospital. These problems are (1992: 5–6):

1. Resource allocation issues. This includes resource distribu-

tion within the hospital as well as the distribution of the
hospital itself in serving patients by type of hospital, terri-
tories, communities (urban and rural), vulnerability of the
community, and economic wealth of the community (rich
and poor). The main economic concepts in this prob-
lem are production and cost function. These two func-
tions are related to issues of equality and effectiveness of
the hospital. Chapters 3–7 specifically discuss aspects of
hospital resource allocation by highlighting productivity,
competitiveness, cost components, the economic burden
of disease, and economic aspects of infectious diseases
originating from the hospital.
2. Resource management issues. This issue is related to
the use of existing resources in terms of input and out-
put. The main important economic concept is efficiency,
including technical efficiency, economical efficiency, and
scale, as well as the relationships among these concepts.
Chapters 9–12 discuss resource management issues in
more detail by highlighting the economic scale, human
resource development, quality development, and lean
implementation.
3. Generation resource issues. These include the issue of
how the hospital is able to obtain the resources to run
operations without having to cover the access of the
strata of the community, thus violating the principle of
equality. Chapters 14 and 15 will highlight this aspect
specifically by discussing the revenue components of
hospitals and diagnosis-related groups (DRGs).

We will take three of these areas as the main framework of

this book.
 The Importance of Hospital Economics ◾ 9

References
CDC. 2013. Centers for Disease Control and Prevention. CDC’s
Office for State, Tribal, Local and Territorial Support, Atlanta,
GA. http://www.cdc.gov/stltpublichealth.
Decree of the Minister of Social Affairs of Indonesia
No. 50/HUK­/­2004 Social Institution Standardization
and Social Institution Accreditation Guidelines.
Ministry of Health. 2014. Ministry of Health’s Strategic Plan Years
2015–2019.
Kompas. 2015. Health Budget Increases, July 6. http://health.­
kompas.com/read/2015/07/06/170700723/Anggaran.Kesehatan.
Naik.
Newbrander, W., H. Barnum, and J. Kutzin. 1992. Hospital
Economics and Financing in Developing Countries, Geneva:
World Health Organization.
Tribun News. 2014. Kementerian Kesehatan Minta Pemerintah
Tambah Anggaran Program. http://www.tribunnews.com/­
nasional/2014/09/30/kementerian-kesehatan-minta-pemerintah-
tambah-anggaran-program-bpjs. (Accessed December 5, 2017.)
WHO. 2001. The Role of Civil Society in Health. Discussion Paper
No. 1.
WHO. 2006. The Role of Government in Health Development.
WHO. 2009. World Health Statistics.
Chapter 2

Hospital Resource
Allocation

Introduction
The hospital resource allocation issue is concerned with how
the government or private hospital owners allocate the bud-
get and other resources in order to achieve maximum results
while encouraging equality. The government should consider
whether to prioritize a hospital or other health sector, or even
other sectors. Furthermore, governments or private institu-
tions, if they have multiple hospitals, have to consider how to
allocate the funds to the hospital that they think is the most
in need.
Generally, resource allocation to hospitals is done based on
the total number of beds available. This is reasonable because
the target indicator to be achieved is the ideal ratio of the total
number of beds to the population. Even so, another basis may
be used, for example the basis of the bed occupancy rate or
patient satisfaction (Galal, 2003: 20). Regulation of resource
allocation to the hospital can also be rooted in the type of
existing health care system.

11
12 ◾ Hospital Economics

Resource allocation to hospitals in turn brings different

motivations for implementing diagnosis-related groups (DRGs)
and how the implementation is executed (Schmid et al., 2010:
465). There are different models of DRGs applied in vari-
ous countries. A DRG is a disease classification system that
later became the basis of payments for hospital care based
on recovery, not based on medical and nonmedical services.
DRGs are still in the early stages in Indonesia (Rivany, 2009)
and only began to develop after the BPJS scheme was present.
Related to the economic aspects of hospital resource allo-
cation, two concepts need to be understood: the production
function and the cost.

Production Function
The production function is a mathematical relationship
between the output, quantity, and input combinations required
to produce (Newbrander et al., 1992: 11). Output is usually
viewed as a weighted case mix, while input is usually in the
form of items such as the total number of hospital beds; total
number of medical staff; and amount of supply, maintenance,
and housekeeping.
For example, if the government estimates that there will be
100 nurses graduating from nursing school, then the govern-
ment should allocate 100 nurses at the existing health centers
and hospitals. The aim is to allocate 100 nurses so that the
output obtained from this action is the maximum output of the
many options for distributing 100 nurses.
For example, the optimal solution is to allocate 40 nurses
to hospitals and 60 nurses to community health centers
(Newbrander et al., 1992: 8). This means that after 99 nurses
are distributed (40 to hospitals and 59 to community health
centers), an additional nurse to the hospital, who becomes
the 41st nurse, will produce less output than if the nurse
became the 60th nurse in the community health centers.
 Hospital Resource Allocation ◾ 13

Certainly, it will be more rational to send nurses to the

clinic than to the hospital. If the optimal solution is reached,
the allocation is said to have achieved allocative efficiency.
The point is how the allocation produces the biggest total
output.
A hospital production function can be used to examine
the effect of particular inputs to hospital production and the
differences caused by certain categories, such as the hospital
type. Examples of the use of the production function can be
seen from the study of Jensen and Morrisey (1986) as follows.
In their research, the production function is used to determine
the output of the hospital with the allocation of the number of
doctors. Output is denoted by Q, adjusted based on case mix.
Meanwhile, the input uses the number of doctors L and capital
K. The hospitals are free to choose K but not free to choose L
directly, but must choose the size of the medical staff S. The
number of doctors will depend on the proportion of doctors
on the staff (λ). In turn, the proportion size depends on the
capital K, which is the input to the doctor and market condi-
tions N, which may be either availability or other hospital
appeal. Therefore, mathematically, the production function is
formulated as:

Q = F(K, L )
L = λ(K, N ) ⋅ S

If both of these equations are differentiated, the following

will be obtained:

∂Q ∂F  ∂F   ∂λ 
= +  ⋅ ⋅ S
∂K ∂K  ∂L   ∂K 
∂Q  ∂F 
=   ⋅ λ(K, N )
∂S  ∂L 

From the equation above, if K is increased, it will have two

effects on the output Q: first, a direct effect on ∂F/∂K and
14 ◾ Hospital Economics

second, indirect effects on (∂F/∂L) ⋅ (∂λ/∂K) ⋅ S. This indirect

effect works through its ability to attract physicians who are
applying for work. Meanwhile, if S is increased, the resulting
effect will depend on λ, whose value is less than 1.
Operationally, researchers often use the translog production
function. It is often chosen because the form of this function
is more flexible so as to allow estimation of the function in
fully capturing the possible effects from an input (Jensen and
Morrisey, 1986: 432). The translog production function is for-
mulated as follows:

n n

log Q = β0 + ∑ β (log X ) +∑ γ (log X )

i=1
i i
i=1
i i
2

n n

+ ∑ ∑ δ (log X )(log X ) + U
i=1 j=1
ij i j

with Q as the hospital’s output, adjusted to case mix; X1 to X n

are variables that measure K, S, and N. U is the random dis-
turbance that is assumed to be identical and independently
distributed in hospitals.
The first ordo condition (first sigma parts, without squares)
of the equation cannot be fulfilled because of managerial
errors due to inertia or imperfect information about output
requests and input prices. Two of these can be seen as inter-
ference with the first ordo equations. If the first ordo equa-
tions are combined with the translog basic equations, then
the nature of the equation system is a recursive system of a
simultaneous block, which can be approximated by the least-
squares method, assuming U is not correlated with managerial
errors and imperfect information, because these two things are
not dependent on hospital control.
Variable translation in the equation can then depend on the
situation. The variable Q as the hospital’s output variable will
vary because the hospital’s output can be so many different
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buttons here for his little boy at home, and gave them
to me to deliver, as he was about to die. Have them
sewed on to my pants for safe keeping.
July 14.—We have been too busy with the raiders
of late to manufacture any exchange news, and now
all hands are at work trying to see who can tell the
biggest yarns. The weak are feeling well to-night over
the story that we are all to be sent North this month,
before the 20th. Have not learned that the news
came from any reliable source. Rumors of
midsummer battles with Union troops victorious. It’s
“bite dog, bite bear,” with most of us prisoners; we
don’t care which licks, what we want is to get out of
this pen. Of course, we all care and want our side to
win, but it’s tough on patriotism. A court is now held
every day and offenders punished, principally by
buck and gagging, for misdemeanors. The hanging
has done worlds of good, still there is much stealing
going on yet, but in a sly way, not openly. Hold my
own as regards health. The dreaded month of July is
half gone, almost, and a good many over one
hundred and fifty die each day, but I do not know how
many. Hardly any one cares enough about it to help
me any in my inquiries. It is all self with the most of
them. A guard by accident shot himself. Have often
said they didn’t know enough to hold a gun. Bury a
rebel guard every few days within sight of the prison.
Saw some women in the distance. Quite a sight. Are
feeling quite jolly to-night since the sun went down.
Was visited by my new acquaintances of the 9th
Michigan Infantry, who are comparatively new
prisoners. Am learning them the way to live here.
They are very hopeful fellows and declare the war
will be over this coming fall, and tell their reasons
very well for thinking so. We gird up our loins and
decide that we will try to live it through. Rowe,
although often given to despondency, is feeling good
and cheerful. There are some noble fellows here. A
man shows exactly what he is in Andersonville. No
occasion to be any different from what you really are.
Very often see a great big fellow in size, in reality a
baby in action, actually sniveling and crying, and then
again you will see some little runt, “not bigger than a
pint of cider,” tell the big fellow to “brace up” and be a
man. Stature has nothing to do as regards nerve, still
there are noble big fellows as well as noble little
ones. A Sergt. Hill is judge and jury now, and
dispenses justice to evil doers with impartiality. A
farce is made of defending some of the arrested
ones. Hill inquires all of the particulars of each case,
and sometimes lets the offenders go as more sinned
against than sinning. Four receiving punishment.
July 15.—Blank cartridges were this morning fired
over the camp by the artillery, and immediately the
greatest commotion outside. It seems that the signal
in case a break is made, is cannon firing. And this
was to show us how quick they could rally and get
into shape. In less time than it takes for me to write it,
all were at their posts and in condition to open up
and kill nine-tenths of all here. Sweltering hot. Dying
off one hundred and fifty-five each day. There are
twenty-eight thousand confined here now.
July 16.—Well, who ever supposed that it could be
any hotter; but to-day is more so than yesterday, and
yesterday more than the day before. My coverlid has
been rained on so much and burned in the sun, first
one and then the other, that it is getting the worse for
wear. It was originally a very nice one, and home
made. Sun goes right through it now, and reaches
down for us. Just like a bake oven. The rabbit mules
that draw in the rations look as if they didn’t get much
more to eat than we do. Driven with one rope line,
and harness patched up with ropes, strings, &c. Fit
representation of the Confederacy. Not much like U.
S. Army teams. A joke on the rebel adjutant has
happened. Some one broke into the shanty and tied
the two or three sleeping there, and carried off all the
goods. Tennessee Bill, (a fellow captured with me)
had charge of the affair, and is in disgrace with the
adjutant on account of it. Every one is glad of the
robbery. Probably there was not ten dollars worth of
things in there, but they asked outrageous prices for
everything. Adjt. very mad, but no good. Is a small,
sputtering sort of fellow.
July 17.—Cords contracting in my legs and very
difficult for me to walk—after going a little ways have
to stop and rest and am faint. Am urged by some to
go to the hospital but don’t like to do it; mess say had
better stay where I am, and Battese says shall not
go, and that settles it. Jimmy Devers anxious to be
taken to the hospital but is pursuaded to give it up.
Tom McGill, another Irish friend, is past all recovery;
is in another part of the prison. Many old prisoners
are dropping off now this fearful hot weather; knew
that July and August would thin us out; cannot keep
track of them in my disabled condition. A fellow
named Hubbard with whom I have conversed a good
deal, is dead; a few days ago was in very good
health, and its only a question of a few days now with
any of us. Succeeded in getting four small onions
about as large as hickory nuts, tops and all for two
dollars Confederate money. Battese furnished the
money but won’t eat an onion; ask him if he is afraid
it will make his breath smell? It is said that two or
three onions or a sweet potato eaten raw daily will
cure the scurvy. What a shame that such things are
denied us, being so plenty the world over. Never
appreciated such things before but shall hereafter.
Am talking as if I expected to get home again. I do.
July 18.—Time slowly dragging itself along. Cut
some wretchs hair most every day. Have a sign out
“Hair Cutting,” as well as “Washing,” and by the way,
Battese has a new wash board made from a piece of
the scaffold lumber. About half the time do the work
for nothing, in fact not more than one in three or four
pays anything—expenses not much though, don’t
have to pay any rent. All the mess keeps their hair
cut short which is a very good advertisement. My
eyes getting weak with other troubles. Can just
hobble around. Death rate more than ever, reported
one hundred and sixty-five per day; said by some to
be more than that, but 165 is about the figure. Bad
enough without making any worse than it really is.
Jimmy Devers most dead and begs us to take him to
the hospital and guess will have to. Every morning
the sick are carried to the gate in blankets and on
stretchers, and the worst cases admitted to the
hospital. Probably out of five or six hundred half are
admitted. Do not think any lives after being taken
there; are past all human aid. Four out of every five
prefer to stay inside and die with their friends rather
than go to the hospital. Hard stories reach us of the
treatment of the sick out there and I am sorry to say
the cruelty emanates from our own men who act as
nurses. These dead beats and bummer nurses are
the same bounty jumpers the U. S. authorities have
had so much trouble with. Do not mean to say that all
the nurses are of that class but a great many of them
are.
July 19.—There is no such thing as delicacy here.
Nine out of ten would as soon eat with a corpse for a
table as any other way. In the middle of last night I
was awakened by being kicked by a dying man. He
was soon dead. In his struggles he had floundered
clear into our bed. Got up and moved the body off a
few feet, and again went to sleep to dream of the
hideous sights. I can never get used to it as some do.
Often wake most scared to death, and shuddering
from head to foot. Almost dread to go to sleep on this
account. I am getting worse and worse, and prison
ditto.
July 20.—Am troubled with poor sight together with
scurvy and dropsy. My teeth are all loose and it is
with difficulty I can eat. Jimmy Devers was taken out
to die to-day. I hear that McGill is also dead. John
McGuire died last night, both were Jackson men and
old acquaintances. Mike Hoare is still policeman and
is sorry for me. Does what he can. And so we have
seen the last of Jimmy. A prisoner of war one year
and eighteen days. Struggled hard to live through it,
if ever any one did. Ever since I can remember have
known him. John Maguire also, I have always known.
Everybody in Jackson, Mich., will remember him, as
living on the east side of the river near the
wintergreen patch, and his father before him. They
were one of the first families who settled that country.
His people are well to do, with much property.
Leaves a wife and one boy. Tom McGill is also a
Jackson boy and a member of my own company.
Thus you will see that three of my acquaintances
died the same day, for Jimmy cannot live until night I
don’t think. Not a person in the world but would have
thought either one of them would kill me a dozen
times enduring hardships. Pretty hard to tell about
such things. Small squad of poor deluded Yanks
turned inside with us, captured at Petersburg. It is
said they talk of winning recent battles. Battese has
traded for an old watch and Mike will try to procure
vegetables for it from the guard. That is what will
save us if anything.
July 21.—And rebels are still fortifying. Battese has
his hands full. Takes care of me like a father. Hear
that Kilpatrick is making a raid for this place. Troops
(rebel) are arriving here by every train to defend it.
Nothing but corn bread issued now and I cannot eat
it any more.
July 22.—A petition is gotten up signed by all the
sergeants in the prison, to be sent to Washington, D.
C., begging to be released. Capt. Wirtz has
consented to let three representatives go for that
purpose. Rough that it should be necessary for us to
beg to be protected by our government.
July 23.—Reports of an exchange in August. Can’t
stand it till that time. Will soon go up the spout.
July 24.—Have been trying to get into the hospital,
but Battese won’t let me go. Geo. W. Hutchins,
brother of Charlie Hutchins of Jackson, Mich., died
to-day—from our mess. Jimmy Devers is dead.
July 25.—Rowe getting very bad. Sanders ditto.
Am myself much worse, and cannot walk, and with
difficulty stand up. Legs drawn up like a triangle,
mouth in terrible shape, and dropsy worse than all. A
few more days. At my earnest solicitation was carried
to the gate this morning, to be admitted to the
hospital. Lay in the sun for some hours to be
examined, and finally my turn came and I tried to
stand up, but was so excited I fainted away. When I
came to myself I lay along with the row of dead on
the outside. Raised up and asked a rebel for a drink
of water, and he said: “Here, you Yank, if you ain’t
dead, get inside there!” And with his help was put
inside again. Told a man to go to our mess and tell
them to come to the gate, and pretty soon Battese
and Sanders came and carried me back to our
quarters; and here I am, completely played out.
Battese flying around to buy me something good to
eat. Can’t write much more. Exchange rumors.
July 26.—Ain’t dead yet. Actually laugh when I
think of the rebel who thought if I wasn’t dead I had
better get inside. Can’t walk a step now. Shall try for
the hospital no more. Had an onion.
July 27.—Sweltering hot. No worse than yesterday.
Said that two hundred die now each day. Rowe very
bad and Sanders getting so. Swan dead, Gordon
dead, Jack Withers dead, Scotty dead, a large
Irishman who has been near us a long time is dead.
These and scores of others died yesterday and day
before. Hub Dakin came to see me and brought an
onion. He is just able to crawl around himself.
July 28.—Taken a step forward toward the
trenches since yesterday, and am worse. Had a
wash all over this morning. Battese took me to the
creek; carries me without any trouble.
July 29.—Alive and kicking. Drank some soured
water made from meal and water.
July 30.—Hang on well, and no worse.
 MOVED JUST IN TIME.

REMOVED FROM ANDERSONVILLE TO THE MARINE HOSPITAL,

SAVANNAH—GETTING THROUGH THE GATE—BATTESE HAS
SAVED US—VERY SICK BUT BY NO MEANS DEAD YET—
BETTER AND HUMANE TREATMENT.

Aug. 1.—Just about the same. My Indian friend

says: “We all get away.”
Aug. 2.—Two hundred and twenty die each day.
No more news of exchange.
Aug. 3.—Had some good soup, and feel better. All
is done for me that can be done by my friends. Rowe
and Sanders in almost as bad a condition as myself.
Just about where I was two or three weeks ago.
Seem to have come down all at once. August goes
for them.
Aug. 4.—Storm threatened. Will cool the
atmosphere. Hard work to write.
Aug. 5.—Severe storm. Could die in two hours if I
wanted to, but don’t.
 Aug. 12.—Warm. Warm. Warm. If I only had some
shade to lay in, and a glass of lemonade.
Aug. 13.—A nice spring of cold water has broken
out in camp, enough to furnish nearly all here with
drinking water. God has not forgotten us. Battese
brings it to me to drink.
Aug. 14.—Battese very hopeful, as exchange
rumors are afloat. Talks more about it than ever
before.
Aug. 15.—The water is a God-send. Sanders
better and Rowe worse.
Aug. 16.—Still in the land of the living. Capt. Wirtz
is sick and a Lieut. Davis acting in his stead.
Aug. 17.—Hanging on yet. A good many more
than two hundred and twenty-five die now in twenty-
four hours. Messes that have stopped near us are all
dead.
Aug. 18.—Exchange rumors.
Aug. 19.—Am still hoping for relief. Water is
bracing some up, myself with others. Does not hurt
us.
Aug. 20.—Some say three hundred now die each
day. No more new men coming. Reported that Wirtz
is dead.
 Aug. 21.—Sleep nearly all the time except when
too hot to do so.
Aug. 22—Exchange rumors.
Aug. 23.—Terribly hot.
Aug. 24.—Had some soup. Not particularly worse,
but Rowe is, and Sanders also.
Aug. 25.—In my exuberance of joy must write a
few lines. Received a letter from my brother, George
W. Ransom, from Hilton Head.[A] Contained only a
few words.
[A] My brother supposed me dead, as I
had been so reported; still, thinking it
might not be so, every week or so he
would write a letter and direct to me as a
prisoner of war. This letter, very strangely,
reached its destination.
Aug. 26.—Still am writing. The letter from my
brother has done good and cheered me up. Eye sight
very poor and writing tires me. Battese sticks by;
such disinterested friendship is rare. Prison at its
worst.
Aug. 27.—Have now written nearly through three
large books, and still at it. The diary am confident will
reach my people if I don’t. There are many here who
are interested and will see that it goes north.
Aug. 28.—No news and no worse; set up part of
the time. Dying off a third faster than ever before.
Aug. 29.—Exchange rumors afloat. Any kind of a
change would help me.
Aug. 30.—Am in no pain whatever, and no worse.
Aug. 31.—Still waiting for something to turn up. My
Indian friend says: “good news yet.” Night.—The
camp is full of exchange rumors.
Sept 1.—Sanders taken outside to butcher cattle.
Is sick but goes all the same. Mike sick and no longer
a policeman. Still rumors of exchange.
Sept. 2.—Just about the same; rumors afloat does
me good. Am the most hopeful chap on record.
Sept. 3.—Trade off my rations for some little luxury
and manage to get up quite a soup. Later.—
Sanders sent in to us a quite large piece of fresh
beef and a little salt; another God-send.
Sept. 4.—Anything good to eat lifts me right up,
and the beef soup has done it.
Sept. 4.—The beef critter is a noble animal. Very
decided exchange rumors.
 Sept. 5.—The nice spring of cold water still flows
and furnishes drinking water for all; police guard it
night and day so to be taken away only in small
quantities. Three hundred said to be dying off each
day.
Sept. 6.—Hurrah! Hurrah!! Hurrah!!! Can’t holler
except on paper. Good news. Seven detachments
ordered to be ready to go at a moment’s notice.
Later.—All who cannot walk must stay behind. If left
behind shall die in twenty-four hours. Battese says I
shall go. Later.—Seven detachments are going out
of the gate; all the sick are left behind. Ours is the
tenth detachment and will go to-morrow so said. The
greatest excitement; men wild with joy. Am worried
fearful that I cannot go, but Battese says I shall.
Sept. 7.—Anxiously waiting the expected
summons. Rebels say as soon as transportation
comes, and so a car whistle is music to our ears.
Hope is a good medicine and am sitting up and have
been trying to stand up but can’t do it; legs too
crooked and with every attempt get faint. Men laugh
at the idea of my going, as the rebels are very
particular not to let any sick go, still Battese say I am
going. Most Dark.—Rebels say we go during the
night when transportation comes. Battese grinned
when this news come and can’t get his face
straightened out again.
 Marine Hospital, Savannah, Ga., Sept. 15, 1864.
—A great change has taken place since I last wrote
in my diary. Am in heaven now compared with the
past. At about midnight, September 7th, our
detachment was ordered outside at Andersonville,
and Battese picked me up and carried me to the
gate. The men were being let outside in ranks of four,
and counted as they went out. They were very strict
about letting none go but the well ones, or those who
could walk. The rebel adjutant stood upon a box by
the gate, watching very close. Pitch pine knots were
burning in the near vicinity to give light. As it came
our turn to go Battese got me in the middle of the
rank, stood me up as well as I could stand, and with
himself on one side and Sergt. Rowe on the other
began pushing our way through the gate. Could not
help myself a particle, and was so faint that I hardly
knew what was going on. As we were going through
the gate the adjutant yells out: “Here, here! hold on
there, that man can’t go, hold on there!” and Battese
crowding right along outside. The adjutant struck
over the heads of the men and tried to stop us, but
my noble Indian friend kept straight ahead, hallooing:
“He all right, he well, he go!” And so I got outside,
and adjutant having too much to look after to follow
me. After we were outside, I was carried to the
railroad in the same coverlid which I fooled the rebel
out of when captured, and which I presume has
saved my life a dozen times. We were crowded very
thick into box cars. I was nearly dead, and hardly
knew where we were or what was going on. We were
two days in getting to Savannah. Arrived early in the
morning. The railroads here run in the middle of very
wide, handsome streets. We were unloaded, I should
judge, near the middle of the city. The men as they
were unloaded, fell into line and were marched away.
Battese got me out of the car, and laid me on the
pavement. They then obliged him to go with the rest,
leaving me; would not let him take me. I lay there
until noon with four or five others, without any guard.
Three or four times negro servants came to us from
houses near by, and gave us water, milk and food.
With much difficulty I could set up, but was
completely helpless. A little after noon a wagon came
and toted us to a temporary hospital in the outskirts
of the city, and near a prison pen they had just built
for the well ones. Where I was taken it was merely an
open piece of ground, having wall tents erected and
a line of guards around it. I was put into a tent and
lay on the coverlid. That night some gruel was given
to me, and a nurse whom I had seen in Andersonville
looked in, and my name was taken. The next
morning, September 10th, I woke up and went to
move my hands, and could not do it; could not move
either limb so much as an inch. Could move my head
with difficulty. Seemed to be paralyzed, but in no pain
whatever. After a few hours a physician came to my
tent, examined and gave me medicine, also left
medicine, and one of the nurses fed me some soup
or gruel. By night I could move my hands. Lay awake
considerable through the night thinking. Was happy
as a clam in high tide. Seemed so nice to be under a
nice clean tent, and there was such cool pure air.
The surroundings were so much better that I thought
now would be a good time to die, and I didn’t care
one way or the other. Next morning the doctor came,
and with him Sergt. Winn. Sergt. Winn I had had a
little acquaintance with at Andersonville. Doctor said I
was terribly reduced, but he thought I would improve.
Told them to wash me. A nurse came and washed
me, and Winn brought me a white cotton shirt, and
an old but clean pair of pants; my old clothing, which
was in rags, was taken away. Two or three times
during the day I had gruel of some kind, I don’t know
what. Medicine was given me by the nurses. By night
I could move my feet and legs a little. The cords in
my feet and legs were contracted so, of course, that I
couldn’t straighten myself out. Kept thinking to
myself, “am I really away from that place
Andersonville?” It seemed too good to be true. On
the morning of the 12th, ambulances moved all to the
Marine Hospital, or rather an orchard in same yard
with Marine Hospital, where thirty or forty nice new
tents have been put up, with bunks about two feet
from the ground, inside. Was put into a tent. By this
time could move my arms considerable. We were
given vinegar weakened with water, and also salt in
it. Had medicine. My legs began to get movable more
each day, also my arms, and to-day I am laying on
my stomach and writing in my diary. Mike Hoare is
also in this hospital. One of my tent mates is a man
named Land, who is a printer, same as myself. I hear
that Wm. B. Rowe is here also, but haven’t seen him.
Sept. 16.—How I do sleep; am tired out, and
seems to me I can just sleep till doomsday.
Sept. 17.—Four in each tent. A nurse raises me
up, sitting posture, and there I stay for hours, dozing
and talking away. Whiskey given us in very small
quantities, probably half a teaspoonful in half a glass
of something, I don’t know what. Actually makes me
drunk. I am in no pain whatever.
Sept. 18.—Surgeon examined me very thoroughly
to-day. Have some bad sores caused by laying down
so much; put something on them that makes them
ache. Sergt. Winn gave me a pair of socks.
Sept. 19.—A priest gave me some alum for my
sore mouth. Had a piece of sweet potato, but couldn’t
eat it. Fearfully weak. Soup is all I can eat, and don’t
always stay down.
Sept. 20.—Too cool for me. The priest said he
would come and see me often. Good man. My left
hand got bruised in some way and rebel done it up.
He is afraid gangrene will get in sore. Mike Hoare is
quite sick.
Sept. 21.—Don’t feel as well as I did some days
ago. Can’t eat; still can use my limbs and arms more.
Sept. 22.—Good many sick brought here.
Everybody is kind, rebels and all. Am now differently
sick than at any other time. Take lots of medicine, eat
nothing but gruel. Surgeons are very attentive. Man
died in my tent. Oh, if I was away by myself, I would
get well. Don’t want to see a sick man. That makes
me sick.
Sept. 23.—Shall write any way; have to watch
nurses and rebels or will lose my diary. Vinegar
reduced I drink and it is good; crave after acids and
salt. Mouth appears to be actually sorer than ever
before, but whether it is worse or not can’t say. Sergt.
Winn says the Doctor says that I must be very careful
if I want to get well. How in the old Harry can I be
careful? They are the ones that had better be careful
and give me the right medicine and food. Gruel made
out of a dish cloth to eat.