"There's been an assumption that these hospitals that don't pay taxes are spared the taxes because they provide a community benefit," said Dr. Vikas Saini, president of the Lown Institute.
The institute's analysis shows that is not necessarily the case, Saini said. Nearly three-quarters of private nonprofit hospitals nationwide spent less on community benefits than they received in tax breaks. That translated into a total deficit of $17 billion.
The rate was even higher in New York City, where 33 of 40 private hospitals spent less than they got in tax breaks, the institute's analysis found.
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Lown calculated a total fair share deficit of $17 billion in 2018, the latest year for which tax forms were available. Individual hospital deficits ranged from a few thousand dollars to $261 million at Cleveland Clinic's main campus.
"What we're finding is, based on the dollar benefit of the non-profit status, there are a lot of hospitals that really aren't meeting that social contract, if you will," said Dr. Vikas Saini, president of the Lown Institute, a nonpartisan think tank focused on healthcare cost, quality and equity issues.
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Overtreatment and low-value care may cost more than $100 billion per year. In the new Back Surgery (Spinal Fusion) rating, we incorporate a measure of overuse that was calculated for U.S. News by data scientists at the Lown Institute, a nonpartisan think tank. This measure is also a component of the Overuse metric of the Lown Institute Hospitals Index. Because a pattern of overuse or low-value care is not compatible with being a high-quality provider, U.S. News will explore additional opportunities to incorporate measures of value in future editions of Best Hospitals.
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What the study found was that major U.S. cities, including Philadelphia, have some of the most racially segregated hospitals in the country. And many metropolitan areas have a high proportion of hospitals at each end of the inclusivity rankings (most inclusive versus least inclusive).
“Typically what we see is that some ZIP codes contribute a lot more to a hospital or other ZIP codes inside that perimeter contribute far fewer,” said Saini. “Some ZIP codes contribute none at all.”
One of the goals of the Lown Institute’s Hospital Index is to invite stakeholders to create a health care system that doesn’t look so segregated, Saini said, “where people go where they go because they made a choice. [Where] it’s not just about their income or their insurance or the color of their skin or the neighborhood they live in. And we’re a long way from that.”
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In 2021, the Lown Institute, an independent think tank, released a ranking system for U.S. hospitals’ on the degree to which they are adequately caring for the lower income and patients of color. Sadly, only two Atlanta metro area hospitals ranked in the top 100 for racial inclusivity, Grady Memorial Hospital and Wellstar Atlanta Medical Center and Emory University Hospital Midtown. This is likely a function of their location in downtown Atlanta rather than an actual strategy to address racial inclusivity and health equity.
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“Hospitals reside in communities and are part of communities. Our view is they shouldn’t just serve a community, they should genuinely be part of a community,” said Vikas Saini, a physician and president of the Lown Institute. “A lot of the contemporary rankings that look at reputation or mortality, surgical complications, don’t capture that dimension. We set out to create a lens through which to view the hospital system that’s different.”
“It’s not that Black people aren’t getting hospital care — they are — but for every hospital that’s tilted one way, there’s another that’s tilted the other,” Saini said.
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Through the years, we’ve learned not to underestimate the lengths to which institutions and individuals will go to protect their bottom lines. We like to think that no bad behavior can surprise us anymore—but then we learn better. Last year, we found a pharmaceutical company seeking the financially advantageous “orphan” drug designation for a drug it said was for a rare disease. The disease was COVID-19.
When we put all the examples of Shkreli-like behavior together, they stop looking like anecdotes and start looking like evidence. That’s the point of the awards: to highlight the structural weaknesses in health care that allow this kind of behavior to occur.
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“Overuse is ubiquitous,” said Dr. Vikas Saini, president of the Lown Institute. “Nearly every hospital is doing at least some things that patients don’t really need.”
“There is improvement,” he added, “but it is very slow and it is very uneven.”
Saini, of the Lown Institute, said he hopes more attention on overuse will push hospitals to do better. “We’re trying to create new norms for what it means to be a good hospital,” he said.
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The US health system pushes treatment over prevention. This approach has many flaws, one of the most unfortunate and costly being overdiagnosis and overtreatment.
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The Lown Institute's report is yet another effort in a series of recent attempts to quantify and rank health care organizations' progress on achieving health equity. The authors delivered a bold and necessary message: Hospitals across the U.S. are racially segregated—that is to say, their Medicare patients' racial demographics don't match the demographics in their surrounding communities. These results might come as a shock to some—especially for those working at hospitals near the bottom of the list. But this data shouldn't be surprising.
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