Local hospitals’ community-benefits spending falls millions short of their tax benefits, report finds

"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.

VIDEO: Community Benefit launch

The value of the nonprofit tax exemption is worth tens of billions to hospitals. But what are we getting back in exchange for this hefty tax break? Watch the launch video for a discussion of community benefit standards, hospital billing practices, and fair share spending with health policy experts. More

Big-name hospitals have biggest community spending shortfalls, report shows

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.


PRESS RELEASE: Most U.S. nonprofit hospitals neglect community investment obligation, analysis reveals

Though all nonprofit hospitals enjoy big tax breaks, many fail to make commensurate investments in community health, according to a new analysis from the Lown Institute. The Institute today released Community Benefit findings from its 2021 Hospitals Index, that show nonprofit hospitals collectively failed to invest nearly $17 billion in their communities. More

And the ‘Shkreli Award’ goes to …

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.