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Analysis

Tax-exempt Hospitals Provided $100B in Community Benefits

By John Commins  
   July 15, 2020

AHA reports total community benefits for nonprofits were 13.8% of total hospital expenses in 2017.

The nation's more than 2,764 tax-exempt hospitals provided $100 billion in total benefits to their communities in 2017, the most recent year for which data is available, according to a report from the American Hospital Association.

The analysis also shows that tax-exempt hospitals' and health systems’ total community benefits were 13.8% of their total expenses in 2017.

Nearly half of that total, came in the form of financial aid for patients and hospitals eating losses from Medicaid and other "underpaying" government programs, AHA said. 

"Hospitals and health systems of all sizes and types deliver a wide range of benefits, activities, services and programs on a daily basis to meet the varied needs of their patients and communities," AHA President and CEO Rick Pollack said. "This new analysis shows that improving the health of their communities remains at the heart of the mission of hospitals and health systems." 

The community benefits were fairly consistent across the board, with variations found based on size, location, and patient mix. Urban/suburban hospitals generally reported larger community benefits as a percentage of total expenses (13.6%), versus rural hospitals (10.1%).

Pediatric hospitals generally reported higher percentages of community benefits (15.9%) from total expenses.

“This new analysis shows that improving the health of their communities remains at the heart of the mission of hospitals and health systems.”

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.


KEY TAKEAWAYS

The community benefits were fairly consistent across the board, with variations found based on size, location, and patient mix.

Urban/suburban hospitals generally reported larger community benefits as a percentage of total expenses (13.6%), versus rural hospitals (10.1%).

Pediatric hospitals generally reported higher percentages of community benefits (15.9%) from total expenses.


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