The Childbirth Industrial Complex

[The Sultan]

Also this:

Top executives are paid millions as their hospitals expand, buy expensive technology and build aggressively. And they benefit each year from a perk worth millions: They pay no income, property or sales taxes. These institutions were created with charitable missions. But many don't act like nonprofits anymore. In their quest for growth and financial strength, they have contributed to the rising cost of health care, leaving thousands of patients with bills they struggle to pay.

How are non-profit health care organizations supposed to "act?"

They have to be financially viable, compete for talent, and competitively serve their exempt purpose without outside investment from owners.

[Pakuni]

How are non-profit health care organizations supposed to "act?"

They have to be financially viable, compete for talent, and competitively serve their exempt purpose without outside investment from owners.

This is a pretty good read on here nonprofit health organizations are today, how they're supposed to act and how they're actually acting.
The short version ... it's a tough environment, but many focus on increasing revenues and growing footprints at the expense of their supposed and required role of serving the community interest.

https://www.nytimes.com/2023/11/30/opinion/hospitals-nonprofit-community.html

[The Sultan]

This is a pretty good read on here nonprofit health organizations are today, how they're supposed to act and how they're actually acting.
The short version ... it's a tough environment, but many focus on increasing revenues and growing footprints at the expense of their supposed and required role of serving the community interest.

https://www.nytimes.com/2023/11/30/opinion/hospitals-nonprofit-community.html

"And in return for their tax exemptions, these institutions are supposed to invest the money that would have gone to taxes into their communities by lowering health care costs, providing community health services and free care to those unable to afford it and conducting research."

They are? Where does it say this?

Now I am not defending some of these practices. But under current IRS Code, they are not required to do any of these things.  Something the GAO has acknowledged.

https://www.gao.gov/products/gao-23-106777

So the law needs to change more than anything.

[Pakuni]

"And in return for their tax exemptions, these institutions are supposed to invest the money that would have gone to taxes into their communities by lowering health care costs, providing community health services and free care to those unable to afford it and conducting research."

They are? Where does it say this?

Now I am not defending some of these practices. But under current IRS Code, they are not required to do any of these things.  Something the GAO has acknowledged.

https://www.gao.gov/products/gao-23-106777

So the law needs to change more than anything.

Some of the requirements, according to the link, that seem to fall under that:

- Operate an emergency room open to all, regardless of ability to pay
- Use surplus funds to improve facilities, equipment and patient care
- Use surplus funds to advance medical training, education and research
- Conduct a community health needs assessment
- Maintain a written financial assistance policy
- Set a limit on charges
- Set billing and collection limits

[The Sultan]

Some of the requirements, according to the link, that seem to fall under that:

- Operate an emergency room open to all, regardless of ability to pay
- Use surplus funds to improve facilities, equipment and patient care
- Use surplus funds to advance medical training, education and research
- Conduct a community health needs assessment
- Maintain a written financial assistance policy
- Set a limit on charges
- Set billing and collection limits

You are misreading the chart.  The requirement is the statements at the top.  The list are factors that demonstrate if they are meeting that purpose.  And the narrative states that:

"In 1969, the Internal Revenue Service (IRS) identified factors that can demonstrate community benefits, but they are not requirements. IRS does not have authority to specify activities hospitals must undertake and makes determinations based on facts and circumstances. As a result, tax-exempt hospitals have broad latitude to determine the community benefits they provide, but the lack of clarity creates challenges for IRS in administering tax law."

[lawdog77]

Some of the requirements, according to the link, that seem to fall under that:

- Operate an emergency room open to all, regardless of ability to pay
- Use surplus funds to improve facilities, equipment and patient care
- Use surplus funds to advance medical training, education and research
- Conduct a community health needs assessment
- Maintain a written financial assistance policy
- Set a limit on charges
- Set billing and collection limits

1. EMTALA covers point 1
2. and 3. That is the growing footprint MU82's article seems to rail against
4. Off hand I think the community needs assesment is required every 3 years
5. The financial assistance policy must be prominently displayed as well and be available to all patients
6. "charge" limits are based onMedicare rates-DRG codes
7. Uninsured can only be billed at the average reimbursement rate nonprofits get from contracted insured , and if balances are written off, it must be the same policy for everyone

From my professional experience, the biggest problem is copays and deductibles are through the roof, as well as educating the public on their rights

[Pakuni]

You are misreading the chart.  The requirement is the statements at the top.  The list are factors that demonstrate if they are meeting that purpose.  And the narrative states that:

"In 1969, the Internal Revenue Service (IRS) identified factors that can demonstrate community benefits, but they are not requirements. IRS does not have authority to specify activities hospitals must undertake and makes determinations based on facts and circumstances. As a result, tax-exempt hospitals have broad latitude to determine the community benefits they provide, but the lack of clarity creates challenges for IRS in administering tax law."

If you dive into the testimony (PDF of it in the link you attached), it states that:
1. Nonprofit hospitals must provide a community benefit.
2. The green portion of the chart are examples of community benefits they can provide to meet the requirement.
3. The blue portion of the chart (Under Patient Protection and Affordable Care Act Requirements) are things they must do to be tax exempt.

From the testimony, page 8
PPACA established four additional requirements that tax-exempt hospitals must meet to maintain a tax exemption



Edit: Regardless of what the chart does and doesn't say, do you agree the column I linked illustrates how the focus on growing revenues and expanding health care fiefdoms can run counter to, or at least diminish, nonprofit hospitals' purported mission of serving their community?

Here's something else worth reading:

Federal, state, and local laws exempt nonprofit hospitals from paying a variety of taxes under the assumption they will give back to their communities in commensurate amounts through patient financial assistance, primary care clinics, substance abuse treatment, and other programs. However, a new analysis using government data finds that 80% of nonprofit hospitals give back less to their communities than they receive in estimated tax breaks, with some short by hundreds of millions.

https://lowninstitute.org/press-release-more-than-1900-nonprofit-hospitals-receive-more-in-tax-breaks-than-they-give-back-to-their-community-totaling-billions/

[MU82]

How are non-profit health care organizations supposed to "act?"

They have to be financially viable, compete for talent, and competitively serve their exempt purpose without outside investment from owners.

I'm satisfied with the way others have responded, so I won't repeat what they said.

[The Sultan]

Edit: Regardless of what the chart does and doesn't say, do you agree the column I linked illustrates how the focus on growing revenues and expanding health care fiefdoms can run counter to, or at least diminish, nonprofit hospitals' purported mission of serving their community?

Definitely.

But my larger point, and I think I am being overly-pedantic, is that there really aren't strict guidelines for how not-profit health systems are "supposed" to act. It's all very shades of gray.  So, to go back to the article that MU82 quoted, the way to get hospital heath systems to be more charitable is to put it into law. Because right now, as the law is designed, they seem to be operating very much within the confines of what they are supposed to do.

[lawdog77]

Well maybe costs would go down if insurance executives stopped giving "loans" to Supreme Court justices.

[dgies9156]

One of the concerns with so-called "non-profit" hospital is that they're sliced and diced so much that who has what obligation is, at best fuzzy and at worse, obliterated.

Many communities formed tax-exempt foundations to own hospitals on grounds it was good for a community's well-being and growth to have good medical care. The hospital was truly a service. But as time moves on, the operation of the hospital is contracted to a third-party entity (Cleveland Clinic in my part of the swamp). The hospital retains its tax exempt status and has an oversight board but the day-to-day ops are done by Cleveland Clinics.

OK, so then there's the next question of who runs the operating rooms, nursing, facilities and even staff doctors. In some hospitals, all of these services are contracted out to third parties. The name on the door is nothing more than the Management Company. It's branding and operational profitability that matters.

All the while, the hospital itself is tax-free. The question is who is making the money and who pays for all these new layers of management inside the hospital? I think we know the answer!

[brewcity77]

Consolidation and corporatizing has also become a problem. In Milwaukee, your options are basically Aurora, Ascension, or Froedtert. Wheaton sold their hospitals to Ascension, which has been bad for all the hospitals involved. Further, Ascension outsourced their lab services to LabCorp, which has had a hiring freeze in place for two years while making working conditions worse, so they have slashed staff.

The focus is on the bottom line, which should never be the case when it comes to quality healthcare. The job is to care for the person, not try to give them the cheapest level of care and move them out as soon as possible. There is no such thing as "non-profit" hospitals anymore because the hospital mega corps are buying up any hospitals they can make a profit on and running the ones they can't out of business.

[Pakuni]

Consolidation and corporatizing has also become a problem. In Milwaukee, your options are basically Aurora, Ascension, or Froedtert. Wheaton sold their hospitals to Ascension, which has been bad for all the hospitals involved. Further, Ascension outsourced their lab services to LabCorp, which has had a hiring freeze in place for two years while making working conditions worse, so they have slashed staff.

The focus is on the bottom line, which should never be the case when it comes to quality healthcare. The job is to care for the person, not try to give them the cheapest level of care and move them out as soon as possible. There is no such thing as "non-profit" hospitals anymore because the hospital mega corps are buying up any hospitals they can make a profit on and running the ones they can't out of business.

Yep.

https://harris.uchicago.edu/news-events/news/consolidation-hospital-sector-leading-higher-health-care-costs-study-finds

[Warriors4ever]

My PCP left Ascension Resurrection in Chicago for a concierge practice. He gave me an earful about things when he told me, including how they were selling their hospitalists to a private company, which would result in the staff getting more patients for less money. Two days later it hit the news. In the space of about four years he went from loving his job to getting out for his own well-being and quality of life.

[lawdog77]

My PCP left Ascension Resurrection in Chicago for a concierge practice. He gave me an earful about things when he told me, including how they were selling their hospitalists to a private company, which would result in the staff getting more patients for less money. Two days later it hit the news. In the space of about four years he went from loving his job to getting out for his own well-being and quality of life.

"For profit" hospitals have been outsourcing like this for decades. Ascension is trying it due to having a $3 billion operating loss FY23.

[Hards Alumni]

Abolish health insurance and institute a national health care system like every other first world country.

People shouldn't have their lives ruined financially because they got sick.

[Uncle Rico]

Abolish health insurance and institute a national health care system like every other first world country.

People shouldn't have their lives ruined financially because they got sick.

Bingo.  It'll never happen but this is the correct answer.

It's an economical and moralistic right thing to do

[Jockey]

Abolish health insurance and institute a national health care system like every other first world country.

People shouldn't have their lives ruined financially because they got sick.

Great ideas. but you forgot the 1st one - Get rid of for-profit hospitals.

Costs will never be low as expenses for the hospitals are huge, but they can be lowered

[Hards Alumni]

Great ideas. but you forgot the 1st one - Get rid of for-profit hospitals.

Costs will never be low as expenses for the hospitals are huge, but they can be lowered

I didn't forget it, it's a part of nationalizing health care.

[lawdog77]

I didn't forget it, it's a part of nationalizing health care.

According to OpenSecrets website:
Individuals and PACs associated with the insurance industry made $120 million in federal contributions during the 2020 election cycle.

[Uncle Rico]

According to OpenSecrets website:
Individuals and PACs associated with the insurance industry made $120 million in federal contributions during the 2020 election cycle.

It'll never happen.  Too much money involved. 

[Hards Alumni]

According to OpenSecrets website:
Individuals and PACs associated with the insurance industry made $120 million in federal contributions during the 2020 election cycle.

It's amazing how easily bought and paid for our politicians are, isn't it?

[lawdog77]

It's amazing how easily bought and paid for our politicians are, isn't it?

Yep. It's crazy how both presidential candiates brag  about how much money they have raised.

[The Sultan]

It's amazing how easily bought and paid for our politicians are, isn't it?

Don't even get me started on their lack of moral courage and leadership. Every one of them is useless.

[Pakuni]

According to OpenSecrets website:
Individuals and PACs associated with the insurance industry made $120 million in federal contributions during the 2020 election cycle.

Insurance companies are people just like you and me.