Some members of Congress have recently gone out of their way to misrepresent and undercut the value non-profit hospitals provide to their communities.
These criticisms and reports, much like the one recently published by the chairman of the Senate Health, Labor, Education, & Pensions Committee, distort the federal hospital community benefit requirements and instead seek to redefine the requirements by focusing on only one aspect of community benefit while, at the same time, overlooking the broader spectrum of community benefits that non-profit health systems provide.
Instead of addressing the community benefit requirements, these stories tell only a part of the story to fit a pre-determined conclusion. This creates a misleading impression of not-for-profit hospitals’ contributions to their communities. It encourages poorly informed policy solutions that also ignore the financial realities that not-for-profit hospitals are facing. Such reports seek to promote a one-size-fits-all policy solution that prioritizes financial assistance over community-identified priority needs and other social determinants of health that, if addressed, would improve the health of individuals and families in the community.
Everyone providing front-line healthcare delivery understands the importance of financial assistance for those unable to afford their medical bills (also called charity care). However, we must also embrace the reality that prevention, community partnerships, training future healthcare providers, and investing in new research to improve care delivery have value far beyond the dollars spent. It is why the current community benefit requirements for not-for-profit hospitals do not focus only on financial assistance requirements but instead embrace a public health-informed response to community benefit with local participation and buy-in, empowering non-profit healthcare providers to tailor investments to best serve the unique needs of individual communities.
These programs and services are integral to the mission of U.S. Catholic hospitals. We strive to improve health outcomes in hundreds of vulnerable and underserved communities nationwide.
As a result, according to 2020 tax filings, Catholic hospitals spent more than $6 billion on charity care and the costs of services that are not fully paid for by Medicaid and other means-tested programs. At the same time, they invested an additional $3.5 billion in community health improvement, subsidized health services, research and training, and cash or in-kind contributions for community benefit. This doesn’t include the billions more in unpaid medical debt borne by Catholic hospitals, expenses for Medicare services that fail to cover the cost of care or the critical role these hospitals play as anchor institutions in their communities.
When looking at the broader not-for-profit provider community, studies have shown that non-profit hospitals’ total community benefit is up to nine times the value of taxes they would otherwise pay if they were for-profit entities. Non-profit hospitals have continued making these investments despite facing a global pandemic that changed healthcare delivery, causing caregivers to leave their profession due to burnout and exhaustion while creating unprecedented financial constraints on providers.
Numbers for charity care alone also fail to tell the story of the value not-for-profit hospitals provide beyond the financial reports. For example, not-for-profit hospitals are substantially more likely to offer critical services at a loss, including emergency psychiatric services, care for HIV or AIDS, substance abuse treatment, hospice care and obstetric care.
A narrow view also fails to capture the realities of our healthcare delivery and financing structure, which requires hospitals and front-line healthcare providers to absorb the unreimbursed costs of Medicaid and Medicare while at the same time requiring hospitals to be the “collection agency” for health insurance products that increasingly shift costs onto patients through unsustainable copays and deductibles. Not-for-profit hospitals continue to do their share in supporting our nation’s health safety net despite severe financial challenges, including billions of dollars in losses amid unprecedented strain on providers.
Meanwhile, the rest of the healthcare industry sees record profits while not being asked to contribute even a tiny fraction of the investments non-profit hospitals are expected to make. While Catholic non-profit hospitals provide free and discounted services and make billions of dollars in investments toward community benefit — others in the healthcare delivery chain horde profits without any expectation they will invest in caring for unserved or underserved patients.
Catholic, non-profit healthcare providers have a long tradition of caring for vulnerable patients. We are committed to a healthcare future that delivers affordable access to care and better health outcomes for patients — and that commitment includes treating patients, regardless of who they are or their ability to pay, and delivering on our mission to prevent patients from going unserved.
However, if we as a nation are going to ensure that everyone has access to high-quality, affordable care, we must also ensure that policies are accurately informed, promote greater public health, and ensure that all aspects of the healthcare service and delivery system are doing their fair share to support the health safety net. Then, and only then, will we finally have a level playing field upon which to fix this broken system of care.