Healthcare Reform Tightens Tax-Exempt Requirements

"While they did good deeds, the motivation was marketing for more patients to drive business into the hospital. That's not to be confused with what community benefit is. We don't exist to drive business; we exist to take leadership responsibility for our system in the community."

To start, says Boykin, Summa hospitals have developed a coordinated response to providing the services the community needs through community health. Boykin's office works with Akron Children's Hospital and Akron General Health System to try to make sure community benefit activities among the three distinct institutions are coordinated. At Summa, those needs, solicited from the community through surveys and other tools, are translated into action at the corporate level through a board-designated community benefit committee composed of Summa Health System board members, and community leaders and residents.

Further guidance will be provided by the government as regulators translate the law into practice. Initially, failure to conduct a community health needs assessment, which would result in a $50,000 excise tax being imposed on the organization, is the only defined penalty in the law. But others will be forthcoming. In the meantime, August A. Napoli, Jr., the president and COO of the Summa Foundation, says some hospitals and health systems need to rethink their approach to community benefit.

"It's like teaching to the test in education. If they view the world as meeting some minimum standard in order to avoid a $50,000 penalty, then they're not really doing their job anyway. If we're like that, we just don't get it about community benefit."