Community Benefit

Community benefits are services and programs that meet communities' needs and for which hospitals do not receive payments. Community benefit includes free care, medical research, education, and community health improvement initiatives.

By law and mission, hospitals care for all medical emergencies regardless of a person's ability to pay. Hospitals are also first responders and safe havens in time of disaster. They stand ready 24/7 to care for patients.

In exchange for providing community benefits and for serving Medicaid and Medicare patients at a financial loss, not-for-profit hospitals receive tax exemptions, which help to offset those losses and pay for uninsured care.

Hospitals track the current and emerging needs of their communities and develop local solutions for local health problems. They provide services such as ambulance and burn units at a tremendous financial loss. Whether it is providing free care, health education or training future health professionals, your community hospital uses its resources to fulfill its mission. Indiana hospitals provide over $1 billion in community benefits to Hoosiers each year.

Published in Oct.2009, the data displayed below is from 99 short-term acute care hospitals over a 12-month period that reflects their most recently completed fiscal year.

 Charity Care   $517,170,118
 Medicaid Shortfall   $890,491,731
 Community Activities   $260,805,185
 Less: Supplemental payment programs   ($401,717,271)
Net Community Benefit $1,266,749,763

Medicare Shortfall  
+$536,926,230
Bad Debt +$328,465,611
Total Uncompensated Benefit to Hoosiers =$2,132,141,604

Defining the benefits hospitals provide to the community is a legal obligation. Many reporting requirements exist, including the new Internal Revenue Service 990 Schedule H. For an in-depth overview of the Form 990, view the article, Form 990 Core Overview.  

Community Benefit Links

IHA’s Community Benefit Report 2007 
Economic Contributions of Hospitals
Glossary of Terms
AHA Statement on IRS Report on Community Benefit

 

Schedule H Resources
AHA Online Tool for Schedule H
The interactive online helps tax-exempt hospitals prepare to complete Schedule H, the new Internal Revenue Service form for tax-exempt hospitals. Developed with Ernst & Young and Hogan and Hartson, the members-only tool walks users through Schedule H questions, offering explanations, guidance, and links to the IRS instructions for each question. It is the latest in a series of AHA resources to help hospitals prepare for the new reporting requirements. 

Telling the Hospital Story – Going Beyond Schedule H
Provides guidance and tools to help hospitals augment the limited information on Schedule H to ensure the full scope of community benefit is captured and communicated.

 



 

 

 

 

 

 

 

 

 

 

IHA has released its 2011 Work Plan that outlines a list of key association initiatives. The work plan received direction from Board of Directors, IHA’s eight subject area counsels, and feedback provided by members at IHA district meetings. Additiona
Community Benefit Glossary
Community Benefit Report
IHA quick facts
Glossary of Terms