Broward Health Proposes Community Not-for-profit Status

John Commins, September 27, 2010

Broward Health President and CEO Frank Nask is undertaking due diligence on a proposal to transition the giant four-hospital health system from its current not-for-profit public health system status into a community  501(c)(3) not-for-profit corporation.

The board of commissioners of the Fort Lauderdale, Florida-based North Broward Hospital District—one of the 10 largest public health systems in the nation—this month authorized Nask to initiate the transition, which would create a nonprofit corporation led by area business leaders. Under the plan, the corporation comprised of local business and civic leaders would lease the health system from the district and operate its four hospitals, health centers and other facilities. Broward Health's more than 8,000 employees would work for the new corporation, and the system would retain its chartered mission as a safety net hospital for indigents.

Nask says the advantages of transitioning to 501(c)(3) status include the ability expand geographical boundaries, and enter into joint ventures with for-profit healthcare businesses, such as partnerships with physicians' groups, which now are prohibited by Florida law.

"Right now our constitution prohibits us from joint venturing with for-profit entities like physicians," Nask says. "In the world of healthcare when you can do that in a surgery center or radiation therapy it's a big advantage. There are some opportunities out there that we are missing out on."

"The other issue is that there is a joint venture opportunity under the Accountable Care Organization model under Medicare reform, which physicians are always interested in because they like partnering with facilities," he says.

Broward Health collects about $170 million in local property taxes annually, and the health system was projected to report about $3.7 billion in total gross patient revenues, and more than $1 billion in total operating expenses in fiscal 2010.

John Commins

John Commins is a senior editor at HealthLeaders Media.

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