Tuesday, July 18, 2006

Letting Hospitals Off Too Easy

In recent times, there has been a lot of discussion of community hospitals and community benefit. As indicated in a special report on this subject included in the July 3/10 issue of Modern Healthcare, the issue usually boils down to whether non-profit hospitals provide enough charity care to justify their tax exempt status.

I think that is a very short-sighted way to look at community benefit. To me, a non-profit hospital is owned by the community and everything it does ought to be for the community’s benefit. Charity care may be one of those things, but it is by no means the only one.

One source of confusion is the tendency to refer to non-profit hospitals as “charitable organizations.” It is true that non-profit hospitals have long been seen as an instrument of charity, but there are lots of non-profit organizations that are not involved in charity at all.

It may be that in the modern era, non-profit hospitals have become big and rich and powerful and have lost sight of the fact that they owe their allegiance to the communities that own them – not to their doctors, their high-paid executives, or anybody else. They may well need to be reminded of their basic purpose. But allowing them to get off the hook by providing some quota of charity care is letting them off too easy.

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