COLUMBUS, Ohio — Columbus’ four nonprofit hospitals provided nearly $400 million in benefits to their communities in 2008, but “unsustainable trends” threaten the hospitals’ ability to provide those same benefits in the future, an advocacy group warned.
The dollar figure represents charity care, research, community outreach, donations to community groups and education provided by Mount Carmel Health System, Nationwide Children’s Hospital, OhioHealth and The Ohio State University Medical Center, according to a statement from the Central Ohio Hospital Council, an advocacy group for the four hospitals.
The group listed three “unsustainable trends” that “put future benefits at risk” — declining Medicare reimbursement, rapidly rising demand for charity care and for-profit hospitals that siphon away profitable services that subsidize the nonprofits. The $400 million sum includes $175 million in charity care. The amount of charity care the four hospitals provide has risen 163 percent since 2004, according to the group.
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The concept of “community benefit” has become a political hot potato in the past decade. Created by the Internal Revenue Service in 1969, this broad basket of benefits replaced the government’s requirements that hospitals provide a certain level of charity care to patients who could not afford to pay. Some politicians believe hospitals put as many expenses in the community benefits basket as they can to justify continuing exemption from paying taxes.
In recent months, Ohio’s hospitals have come together to denounce a franchise fee that the state imposed as a means of narrowing its budget gap. The state’s hospitals are expected to pay fees of $718 million in fiscal 2010 and 2011, according to the Ohio Hospital Association. However, raises in reimbursements from the federal Medicaid program, as well as other reimbursements, are expected to offset the fees to $145 million in two years, the association said.
Many hospital leaders call the fee a “tax” because it is based on a percentage of hospital expenses — including uncompensated care for patients who can’t afford to pay.
