Our nearest hospital, in Santa Cruz, California, was founded in 1941 by the Adrian Dominican Sisters of Adrian, Michigan. Like other hospitals founded by religious organizations, Dominican was expected to focus on relieving the suffering of poor people. In 1988, Dominican—as it is now known—was taken over by Dignity Health to become one of 41 hospitals in that organization, which includes more than 60,000 employees and 10,000 physicians. Big business.
Hospitals are one of the largest industries in the United
States, with annual revenues exceeding $1.4 trillion. Nonetheless, roughly 60%
of community hospitals, including Dominican, are incorporated as nonprofit
institutions, which means that they are tax exempt. To maintain their
tax-exempt status, they are required to provide “community benefit,” including
charity care, such as providing services for patients unable to pay and making
emergency departments available to all people.
The value of tax exemptions for non-profit hospitals was estimated to be $28.1 billion in 2020. Studies have shown that 72 percent of private nonprofit hospitals spent less on community benefits than they received in tax breaks. What’s more, many nonprofit hospitals generate substantial profits from the federal 340B Drug Price Program that was designed to serve low-income patients. The idea was to “buy low” and “sell low.” But hospitals have turned this into a "buy low, sell high" program for well-insured patients. Some hospitals have adopted aggressive revenue-enhancing activities, such as declining to offer charity care to eligible patients and suing patients and garnishing wages because of unpaid medical bills.
Such a good question. NPR did a great story on merciless collections by a non-profit in Maryland
ReplyDeletehttps://www.npr.org/sections/health-shots/2019/06/25/735385283/hospitals-earn-little-from-suing-for-unpaid-bills-for-patients-it-can-be-ruinous