Measuring Community Benefits Provided By For-Profit And Nonprofit Hospitals

2000 ◽  
Vol 19 (6) ◽  
pp. 168-177 ◽  
Author(s):  
Sean Nicholson ◽  
Mark V. Pauly ◽  
Lawton R. Burns ◽  
Agnieshka Baumritter ◽  
David A. Asch
Keyword(s):  
Nonprofit Hospitals ◽  
For Profit ◽  
Community Benefits

scholarly journals Tax Exemptions for Nonprofit Hospitals: Toward Transparency and Accountability

2011 ◽  
Vol 2 (1) ◽  
Author(s):  
Tammy R. Waymire ◽  
Douglas J. Christensen
Keyword(s):  
Low Income ◽  
Financial Statements ◽  
Income Taxes ◽  
Charity Care ◽  
Nonprofit Hospitals ◽  
The Public ◽  
For Profit ◽  
Community Benefits ◽  
Tax Exemptions ◽  
Urban Hospitals

Whether nonprofit hospitals fulfill their implicit obligation to provide benefits to the public that are commensurate with the benefits associated with their tax exemptions is an important policy question. To contribute to this discussion, we examine the variation in charity care provided, scaled by net patient revenues and by imputed federal income taxes, in a sample of nonprofit hospitals that are subject to Single Audit requirements. We find that small hospitals tend to provide more charity care than large hospitals, and that rural hospitals tend to provide more charity care than urban hospitals. Interestingly enough, we find little difference in charity care amounts provided by hospitals in high income areas v. low income areas, suggesting that demand for charity care, at least in this setting, has little effect on hospital behavior regarding the provision of charity care. As a result of our analyses, we make recommendations for increased availability of hospital financial statements, as well as specific disclosures of other components of community benefits, which represent the applicable standard for evaluating tax exemptions. These recommended disclosures and increased transparency would permit more meaningful policy analysis regarding nonprofit hospitals as well as a comparison to for-profit and governmental hospitals.

The Conversion Conundrum: The State and Federal Response to Hospitals’ Changes in Charitable Status

1997 ◽  
Vol 23 (2-3) ◽  
pp. 221-250
Author(s):  
Lawrence E. Singer
Keyword(s):  
Joint Venture ◽  
Low Cost ◽  
State Level ◽  
The State ◽  
Nonprofit Hospitals ◽  
For Profit ◽  
Tax Exempt ◽  
Federal Response ◽  
Profit Status ◽  
Hospital Conversions

The pressures encountered by hospitals in the current era of reimbursement declines and stiffened competition are well known. As the “ultimate” payors—primarily employers and government—aggressively continue to seek low cost care, the response of the hospital industry has been to move toward consolidation and efficiency-enhancing mechanisms.Increasingly, nonprofit, tax-exempt hospitals have come to believe that they are at a significant disadvantage vis-á-vis their for-profit brethren in their ability to attract the capital needed to compete in the market. A growing trend among nonprofit hospitals, therefore, is to sell to or enter into a joint venture with a proprietary organization, or alternatively to convert to for-profit status. In 1995, fifty-eight nonprofit hospitals became for-profit; hospital conversions to for-profit status in 1996 are projected to outstrip the pace established the prior year.The conversion trend has not gone unnoticed at the state level. Recently, several states have proposed or enacted laws regulating sales and conversions of nonprofit hospitals, and many more states are contemplating such legislation.

Financial Incentives and Competitive Pressure: The Case of the Hospital Industry

2021 ◽  
Author(s):  
Philippe Choné ◽  
Lionel Wilner
Keyword(s):  
Financial Incentives ◽  
Regulatory Reform ◽  
Hospital Industry ◽  
Competitive Pressure ◽  
Nonprofit Hospitals ◽  
For Profit ◽  
Industry Level ◽  
Market Shares

Abstract In the late 2000s, a regulatory reform dramatically strengthened the incentives of French nonprofit hospitals to attract patients. Exploiting exhaustive data for surgery treatments between 2005 and 2008, and modeling hospitals as supplying utility to patients, we show that increased competitive pressure on nonprofit hospitals caused them to perform more procedures, but did not inflate overall activity at the industry level. Although they have gained market shares over their for-profit counterparts, nonprofit hospitals have been significantly worse off after the reform. To adjust to stronger financial incentives, they incurred an additional effort (pecuniary and non-pecuniary costs) equivalent to about a quarter of their annual revenue.

scholarly journals For-Profit Hospitals Have a Unique Opportunity to Serve as Anchor Institutions in the U.S.

2020 ◽  
Author(s):  
Cory E. Cronin ◽  
Berkeley Franz ◽  
Kelly Choyke ◽  
Vanessa Rodriguez ◽  
Brian K. Gran
Keyword(s):  
Rural Communities ◽  
Public Hospitals ◽  
Nonprofit Hospitals ◽  
For Profit ◽  
Vulnerable Communities ◽  
Anchor Institutions ◽  
Current State ◽  
Reporting Mechanism ◽  
Significant Opportunity ◽  
The U.S

Abstract Background Hospitals serve as anchor institutions in many U.S. communities and make contributions to bolster population health and reduce preventable death. Most studies to date have focused on nonprofit hospitals, but there may be significant opportunity for for-profits to fill this role in both urban and rural communities. Methods We calculated descriptive statistics and a multivariate regression model to assess economic and health characteristics for all U.S. counties that contain for-profit as compared to nonprofit or public hospitals. Results For-profit hospitals are more likely to be located in counties with higher uninsurance rates and lower self-rated health. After controlling for hospital and county characteristics, we found a significant and positive relationship between for-profit hospital presence and higher county unemployment, higher uninsured rates, and the number of residents reporting poor/fair health. For-profit hospitals were also less likely to be located in states that had expanded Medicaid or which had certificate-of-need laws. Conclusions There is substantial opportunity for for-profit hospitals to serve as anchor institutions in many U.S. communities, despite this label more traditionally being applied to nonprofit hospitals. Given that there is not currently a regular reporting mechanism for documenting the community health contributions of for-profit hospitals, policymakers and researchers should evaluate the current state of these contributions and develop incentives to encourage more anchor activities to benefit economically vulnerable communities in the U.S.

An Examination of Joint Ventures between Nonprofit Hospitals and For-Profit Businesses

2003 ◽  
Vol 1 (1) ◽  
pp. 41-53 ◽  
Author(s):  
Kent Swift
Keyword(s):  
Board Of Directors ◽  
Joint Ventures ◽  
Joint Venture ◽  
Court Cases ◽  
Nonprofit Hospitals ◽  
For Profit ◽  
Tax Exempt

Nonprofit hospitals have increasingly found that it is to their advantage to enter into joint ventures with for-profit entities as a means of raising capital and/or obtaining expertise. A number of IRS letter rulings, revenue rulings, and court cases have addressed the issue of the types of joint ventures between nonprofit hospitals and for-profit entities that are within the hospital's charitable mission and those joint ventures that cross the line and would cause the hospital to lose its status as a tax-exempt entity under I.R.C. §501(c)(3). An examination of this literature suggests that nonprofit hospitals can avoid jeopardizing their charitable status when entering into joint ventures with for-profit entities by (1) requiring the joint venture operating entity to provide care to a broad segment of the community; (2) maintaining control over the joint venture, preferably by controlling a majority of the positions on the operating entity's board of directors; and (3) crafting joint venture agreements such that they place primary importance on the venture's charitable mission.

Hybrid Problem Solving

2020 ◽  
pp. 217-252
Author(s):  
Paul Lichterman
Keyword(s):  
Los Angeles ◽  
Affordable Housing ◽  
Civic Action ◽  
South Los Angeles ◽  
For Profit ◽  
Community Benefits ◽  
Real Estate Developer ◽  
Close Juxtaposition ◽  
The Will ◽  
Community Benefits Agreement

This chapter evaluates how the close juxtaposition of civic and noncivic in hybrid civic action provides better ways to discern whether or not, and how, nonprofits express the will of people in their immediate locale, and whether or not they pose an effective alternative to governmental action, as some commentators argue. All that should help clarify how civic action really works. The chapter focuses mostly on a locally prominent and successful, nonprofit affordable housing developer, Housing Solutions for Los Angeles (HSLA). It then compares HSLA briefly with efforts by a Tenants of South Los Angeles (ISLA) committee to administer the housing provisions of the community benefits agreement (CBA) that ISLA's campaign won from the Manchester apartments developer. This was a different kind of hybrid. ISLA's affordable housing work for the community ultimately was both financed and constrained by a big, for-profit real estate developer — the Manchester property owner.

Examining the relationship between hospital ownership and population health efforts

2018 ◽  
Vol 32 (8) ◽  
pp. 934-942 ◽  
Author(s):  
Meghan Hufstader Gabriel ◽  
Danielle Atkins ◽  
Xinliang Liu ◽  
Rebecca Tregerman
Keyword(s):  
Population Health ◽  
Health Management ◽  
Ownership Type ◽  
Nonprofit Hospitals ◽  
American Hospital ◽  
Population Health Management ◽  
Content Type ◽  
For Profit ◽  
Health Initiatives ◽  
The Relationship

Purpose The purpose of this paper is to investigate the relationship between ownership type and population health initiatives adopted by hospitals using the 2015 American Hospital Association data. Design/methodology/approach Hospitals of various sizes, ownership structures and geographic locations are represented in the survey. The outcome variables of interest include measures of hospital population health activities. Findings Findings indicate that nonprofit hospitals are most likely to express commitment to population health and participate in population health activities, with for-profit hospitals being least likely. Implications for policy and practice are discussed. Research limitations/implications This study demonstrates that discrepancies in population health approaches exist across ownership status – particularly, nonprofit hospitals appear to be the most likely to be involved in population health efforts. Practical implications As we continue to push for population health management in the hospital setting, grappling with the definition and purpose of population health management will be essential. Social implications Overall, these results suggest that nonprofit hospitals are more likely to be implementing population health efforts than for-profit or government-owned hospitals. Originality/value Although there are several studies on population health in hospitals, this study is the first to investigate the relationship between ownership type and population health initiatives adopted by hospitals.

Sign in / Sign up

Export Citation Format

Share Document