Transcript What is Community Benefit?

Community Benefit
Sharing Responsibility,
Improving Community Health
Kristin D. Wilson, PhD, MHA
Department of Health Management and Policy
Saint Louis University School of Public Health
[email protected]
For Profit vs. Not-for-Profit
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For profit
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Not-for-profit
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Shareholders
Assets belong to the company
ROI – earnings (profit) invested in the business or distribute
dividends to shareholders
Shareholders
Assets are of the Community
ROI – earnings re-invested in community assets to improve
community health
At the heart of this issue…..community benefit
What is Community Benefit?
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A mission-driven, comprehensive, evidencebased philosophy and approach that a notfor-profit hospital embraces to improve the
health of their communities
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Particular emphasis given to the vulnerable
populations
Community benefit is incorporated into the
governance, planning, budgeting, strategies,
programs, services, practices, and activities
of the hospital - ideally.
What is Community Benefit?
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The requirement to financially demonstrate
and report to the IRS how tax-exempt
hospitals provide and report community
benefit, but does not “define” community
benefit.
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Reported on the Schedule H of the Form 990 (new)
Captures financial information and activities
Additional requirements for community
benefit included in the recently passed
health care legislation.
What “Counts” as Community
Benefit?
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The program, activity, or service must respond to a
demonstrated health-related community need
AND
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The program, activity, or service must seek to
achieve at least one community benefit objective:
 Improve Access to Health Services
 Enhance Population Health
 Advance Knowledge
 Demonstrate Charitable Purpose
Source: Catholic Health Association, “Criteria for What Counts”, http://www.chausa.org/NR/rdonlyres/EB7EAA9C-2B44-4B87982E-6139D5889AD2/0/IRS_Slides.pdf
Community Benefit
Old Reporting
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Prior to the 2008 tax year, hospitals reported
community benefit primarily as:
Charity care
 Unreimbursed medicaid costs
 Bad debt required to be separated from charity care
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Dec. 2007, IRS release a new form, the Schedule
H, to attempt to standardize community benefit
reporting for charity care.
Community Benefit
New Reporting
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Hospitals now describe their mission and
demonstrated community benefit activities.
New reporting requirements include:
Under Schedule H Part I (financial reporting –
what counts):
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Community Health Improvement Services
Community Benefit Operations
Health Professions Education
Subsidized Health Services
Research
Cash and In-Kind Contributions
Community Benefit
New Reporting
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Schedule H Part II: Community Building
Activities
Leadership development and training for community
members
 Coalition building
 Community health improvement
 Advocacy
 Workforce development
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Community Benefit New
Reporting
Schedule H Part VI:
 Needs assessment.
 Patient education of eligibility for assistance.
 Describe the community the organization serves, taking into
account the geographic area and demographic constituents it
serves.
 Community building activities (from part II)
 Provide any other information important to describing how the
organization’s hospitals or other health care facilities further its
exempt
 purpose by promoting the health of the community (e.g., open
medical staff, community board, use of surplus funds, etc.).
A new “paradigm” for hospitals
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No longer just about who comes through the
doors of the hospital.
Hospitals must proactively reach out into the
communities and be an active partner to
improve the health of the community.
They must be able to demonstrate their efforts.
Requires new knowledge, skills, abilities….a new
way of organizing and delivering services within
the community and within their own
organization.
Not just a numbers game…..
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Yes, hospitals must translate their activities into
dollars
Yes, hospitals must demonstrate through
evidence (outcomes, epidemiology)
However, those are the pieces that constitute the
reporting of community benefit.
The mission, decisions, and actions undertaken,
which in turn generate those numbers, is the
foundation for community benefit.
Community Benefit:
Translating Into Our
Community
Mercy Health System
Community Benefit
Implications for Our Community
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Shared responsibility for community health
improvement
New opportunities for partnership to achieve
improved health within the community and across
disciplines
New initiatives to support the advancement of
Community Benefit
New opportunities to assess and plan for improved
health
 Legislation – Community Health Assessments
and Community Benefit Planning
Discussion and Questions
Thank you!