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Overcome Your Fears about Community Benefit Reporting and form 990H

Gienna Shaw, for HealthLeaders Media, January 21, 2009

I've been doing a lot of research about the newly revised IRS form 990H lately, trying to gauge how prepared healthcare organizations and marketers are for the latest government push to take transparency to yet another new level.

I've found there are many different ways that hospitals are getting ready. And a few reasons why they haven't yet developed a strategy.

There seem to be four main excuses:

1. "I'm a marketer, so I don't have to worry about 990H—it's a finance thing (and I was told there wouldn't be any math)."

Most experts and professional organizations—including the American Hospital Association, say that healthcare marketers should be working together with finance and other departments to gather the information that's required on the form, which includes a new open-ended essay question.

As I wrote in the January issue of HealthLeaders magazine (see A Story to Tell) finance might be the best department to compile and report numbers. But marketing is the department best equipped to tell your organization's story. You'll need both skill sets to fill out the newly revised IRS Form 990H.

2. "The IRS is never going to revoke a hospital's tax-exempt status based on this form—not anytime soon, anyway."

The IRS has said flat out that this is true—for now. But they are going to be compiling the data on the forms and creating a benchmark based on what all tax-exempt hospitals are doing. The results will likely be distributed along a bell curve—and you don't want to be on either of the low ends.

3. "We don't have to file the form until 2010—we have plenty of time to get ready."

Again, experts and associations say hospitals should start getting ready now in order to be prepared when it counts. "Actually, yesterday would be preferable," Patsy Matheny, a Sugar Grove, OH-based community benefit consultant, told me for the magazine article. "Since community benefit activities happen throughout the organization, it takes quite a bit of time to ferret out all the activities."

4. "We're not a tax-exempt organization—so there's no reason for us to gather this information."

First, it's true that only tax-exempt hospitals must fill out form 990H. But all hospitals must communicate the good they are doing in they're community. Are you really going to let your tax-exempt competition crow about all they do for the community without responding in kind?

Second, in the current economy, cities and towns and states across the nation have started to take a good look at tax-exempt healthcare organizations, asking: "What have you done for us lately?" It's only a matter of time before the reporters and advocacy groups in your community start asking you the same question.

There are many hospitals that are ready for form 990H. They've been promoting their community benefit activities for years and they have a plan in place for this new government mandate. But there are too many that are not ready, that don't have a clear plan, that haven't even decided what role marketing will play in the process.

Remember in elementary school when your teacher told you not to leave that big project till the last minute? Don't be the kid who was up to his or her elbows in wet paper and glue the night before the papier-mâché volcano was due.

Editor's note: You can learn more about getting ready for form 990H at our upcoming Webcast Form 990H: Act Now to Protect Your Reputation.


Gienna Shaw is an editor with HealthLeaders magazine. She can be reached at gshaw@healthleadersmedia.com.

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