Sunday, October 02, 2005

Community Benefit and the Town Square

The Alliance for Advancing Nonprofit Health Care, a Washington-based advocacy organization, has recently issued a report entitled Advancing the Public Accountability of Nonprofit Health Plans. The stated purpose of the report is to provide “a tool to motivate and enable nonprofit health plans to improve their community benefit practices.”

A laudable goal, without doubt. But in reading the report, one gets the impression that community benefit is something that a nonprofit health plan would do in addition to its ordinary business. The report goes so far as to suggest that nonprofit health plans should have a “community benefit ‘infrastructure’ consisting at a minimum of a designated lead executive for organization-wide coordination of effort.”

I always thought that community benefit was the purpose of everything a nonprofit organization did. If making a healthy profit and paying its executives hefty salaries strengthens the ability of the organization to achieve its purposes, then the community benefits.

Modern Healthcare’s story about this report (September 26, 2005 issue) related the case of Blue Cross and Blue Shield of North Carolina, which spent nearly a half million dollars on the U.S. Open golf tournament. When a coalition of doctors, pharmacists and consumers published a report revealing the expenditure, the organization sued them for illegally obtaining and publishing confidential business information.

John Russell, long-time executive head of the Pennsylvania Hospital Association, once said something about this sort of thing that stuck in my mind. He said that if a nonprofit organization was doing something that wouldn’t stand the light of day, it should fix it or quit doing it.

I used to put it in different words. I said that the test of any executive decision in a nonprofit organization was whether the person who made it would be willing to stand in the town square at high noon and defend it.

Both still seem like a good rules to me.

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