Public hospitals make up an important component of healthcare systems in the world. In every country, the bulk of health care services is delivered in public healthcare institutions. In the United States, public hospitals serve as the safety net providers for many people, especially those from the low-income segment (Griffin 2012, p. 83). In design and mandate, public hospitals provide a signification portion of healthcare fore the underinsured and the uninsured segment in the country. However, public hospitals are among those that are affected by changes in the healthcare environment. This is mainly because they use a rigid bureaucratic system and are often constrained by the low resource base. According to Shortell, Wickizer & Wheeler (1984, p. 790) they rely on the government for funding and the policy making structure is rigid such that policies have to be formulated from above. This means individual hospitals have minimal room for experimenting new policies as the need arise. The recent economic crisis increased the number of uninsured and the government new health care laws have both conspired to constrain the effective delivery of health care services in most public hospitals. Over the last few decades, the trend in funding public hospitals has seen a gradual reduction in the federal and state funding for different healthcare programs despite the number of underinsured and uninsured rising (Woolhandler & Himmestein 1997, p. 773). The financial burden on public hospitals has therefore resulted from revenue-expense gap attributed to the above factor. This has put a tremendous strain on resources and has reduced investment in programs and infrastructure to better delivery of health care services. In light of this situation, most public hospitals in the country are exploring different ways to improve their competitiveness and their financial position to serve clients better. These options include governance, administration, and organizational restructuring. The current situation will have a far reaching effect until new administration structures are put in place to help hospitals to become self-financing.