Total Community Benefits Were 13.9% of Total Hospital Expenses in 2018
All hospitals regardless of ownership type provide a comprehensive range of benefits and essential services to their communities. New analysis prepared and released today by the American Hospital Association (AHA) shows that tax-exempt hospitals provided more than $105 billion in total benefits to their communities in 2018 alone, the most recent year for which comprehensive data is available. The analysis also shows that tax-exempt hospitals' and health systems' total community benefits were 13.9% of their total expenses in 2018. Approximately half of this total was attributed to expenditures for financial assistance for patients and absorbing losses from Medicaid and other means-tested government program underpayments. In all, an Ernst and Young report from 2019 demonstrates that for every dollar invested in non-profit hospitals and health systems through the federal tax exemption, $11 in benefits is delivered back to communities.
In addition, the analysis showed that 340B hospitals provided nearly $68 billion in community benefits in 2018. The 340B hospital community benefit analysis can be found HERE.
"For the past year and a half our nation has witnessed how America's hospitals and health systems have cared for their patients and communities in times of an unprecedented public health crisis, providing essential services and saving lives during a pandemic. In addition to responding to and managing this crisis, every single day--year in and year out--hospitals and health systems of all sizes, types and locations not only provide critical care but also deliver a wide range of benefits, activities, services and programs daily to meet the varied health needs of those they serve," said AHA President and CEO Rick Pollack. "Today's analysis demonstrates that improving the health of their communities remains at the heart of the mission of America's hospitals and health systems."
In return for being exempt from federal taxes, non-profit hospitals are required to serve their communities, and to seek input from members of their communities, in particular, medically underserved, low-income and minority populations. Hospitals report publicly on community benefit activities, which include financial assistance for those in need, as well as a wide range of programs and services designed to meet the current and future health needs of all they serve. In addition, hospitals and health systems support emergency preparedness for all types of disasters; education, research and training for the next generation of caregivers; clinics for underserved communities; as well as a range of tailored programs aimed at keeping their communities healthy and productive.