An alliance of Tennessee not-for-profit hospitals has had legislation introduced on its behalf that would require all hospitals in the state to collect and publicly report the amount of community benefits they provide.
The catch is, community benefits specifically would exclude taxes paid, which is a community benefit claimed by the for-profit hospital industry.
The for-profit sector, led by Columbia/HCA Healthcare Corp., has argued that taxes are equivalent to charity care and bad debt as measures of community benefit. When taxes are included in community-benefit calculations, for-profit hospitals typically outshine not-for-profit hospitals in side-by-side comparisons.
If the legislation passes, Tennessee would become at least the sixth state to require hospitals to publicly report community-benefit activities and expenses. The other states are California, Indiana, New York, Texas and Utah. Several other states have voluntary reporting programs, and hospitals in several others voluntarily report their community benefits without a state program.
Most of the existing laws apply only to private, not-for-profit hospitals. They exclude for-profit and governmental hospitals. The proposed legislation in Tennessee would apply to all hospitals, regardless of ownership.
According to the American Hospital Association, at the start of 1994 there were 130 acute-care hospitals in Tennessee: 56 private not-for-profit, 44 for-profit and 30 government-owned.
The Hospital Alliance of Tennessee, a Nashville-based organization that represents the interests of not-for-profit hospitals, had the legislation introduced. It's been battling takeovers of not-for-profit hospitals by for-profit chains throughout the state by helping organize local opposition to such takeovers and by publishing reports touting the benefits of not-for-profit ownership.
Recently, the alliance was instrumental in forcing a binding local referendum to determine whether Cookeville (Tenn.) General Hospital, a 157-bed city-owned facility, should be sold. Columbia and several other suitors have offered to buy the hospital. The referendum is scheduled for March 12.
Under the proposed legislation, all Tennessee hospitals would be required to file an annual report with the state health department detailing the community benefits provided by the hospitals in the past 12 months. Community benefits would include the costs of uncompensated care, donations, research and education (See chart).
Hospitals would be required to post notices in their facilities informing patients and the public that such reports have been filed with the state and are publicly available upon request.
"We need a community-benefits definition that is uniform," said Elliott Moore, the alliance's president. "This should be something everyone should support."
A spokesman for THA-the Association of Hospitals and Health Systems (the Tennessee Hospital Association's new name) said the association, which represents both not-for-profit and for-profit hospitals, hasn't taken a position on the bill, which was introduced last month.