Sunday, April 22, 2018
Health

IRS filings tally Tampa Bay nonprofit hospitals' community benefits

When Bayfront Medical Center became a for-profit business this year, its executives promised to provide just as much care to the poor as ever — on top of paying $1 million in property taxes it avoided as a non-profit.

If that promise comes true, it raises a question that has come up all over the country: How do non-profit hospitals justify not paying taxes?

The federal government now requires non-profit hospitals to list their "community benefit'' in greater detail than ever.

The tally for the Tampa Bay area's 11 non-profit hospitals' most recent filing, covering their 2011 fiscal years:

• An average 4 percent of expenses went to free or reduced-price care for the poor and uninsured

• They posted total losses of $122 million a year on care for Medicaid patients

• They put $47 million a year toward training new physicians, research and community health fairs and education.

The IRS reforms came in the wake of congressional scrutiny over billing practices and chief executives' pay at non-profits.

Documents showing chief executive officer pay at Tampa Bay hospitals have not been updated after recent turnover. But in the last available filings, total compensation packages ranged from $845,645 for former Bayfront CEO Sue Brody to $3.1 million for BayCare Health Systems CEO Steve Mason, who presides over a network that is the area's largest provider.

Though hospitals have long reported their contributions in annual reports, the community benefit filings allow more consistent yearly comparisons among non-profit hospitals. For-profit hospitals do not file such reports.

In 2011, the region's largest hospital, Tampa General, provided the most free and reduced medical services to the poor and uninsured — $41.2 million. St. Anthony's in St. Petersburg spent the highest share of its expenses on charity care — nearly 6 percent — according to a Tampa Bay Times review of the IRS filings.

What the figures don't answer is whether the hospitals are doing enough. Neither the federal government nor the state of Florida requires non-profit hospitals to hit specific targets to maintain tax-exempt status.

"There's not a correct number," said David Kindig, a public health researcher and professor emeritus at the University of Wisconsin. "It's a question that needs to be asked community by community."

At BayCare, which owns St. Anthony's, officials do not set targets but meet whatever need arises, said chief financial officer Tommy Inzina, because "in some areas, the needs are greater than others."

Gerard Anderson, professor of health economics at Johns Hopkins Bloomberg School of Public Health, said non-profit hospitals should aim for a share close to the percentage of uninsured people in the region they serve.

In Tampa Bay, 15 to 23 percent of people under age 65 have no health insurance.

That's much higher than what most non-profit hospitals do.

Tampa General chief financial officer Steve Short said his hospital, where revenues exceed expenses by no more than 3 percent annually, could not hit such high levels.

"If you have percentages that high, I'm not even sure you could exist."

A handful of states have set minimum requirements, but those can backfire, said Martha Somerville of Hilltop Institute, a nonpartisan health research organization. When Texas required that at least 4 percent of net revenue go to charity care, hospitals that had been doing more cut back to the minimum.

"It becomes a ceiling as well as a floor," she said.

• • •

By the federal definition, community contributions are more than just charity care, which is defined as services given to people who prove they cannot afford to pay under each hospital's poverty guidelines.

Medicaid, the state-federal program for the poor, uses lower reimbursement rates than Medicare or private insurance, and hospitals can include the difference between its costs and the reimbursement in their community benefit figure. Research, medical residency training and free community health programs also are included.

Sometimes the Medicaid shortfall makes up the largest portion of community benefit. St. Joseph's Hospitals in Tampa, part of the BayCare system, reported $44.7 million in uncompensated Medicaid care, compared to $25.8 million in charity care.

The inclusion of a Medicaid shortfall can be controversial since for-profits lose on the program, too. When HMA was making the pitch to take over Bayfront, its executives pointed out that as a for-profit chain, it also provides uncompensated care, yet still pays taxes.

At HMA's two Hernando hospitals in 2011, 2 percent of charges met the state's definition of charity, which is uncompensated care provided to patients who earned 200 percent or less of the federal poverty level.

Alan Levine, senior vice president of HMA, includes both Medicaid and charity when he says that 27 percent of care at the firm's two Hernando County hospitals went to the poor in 2010. The two hospitals posted a hefty 21.5 percent profit margin last year.

"Ownership status doesn't matter as much as the characteristics of the community," Levine said. "We've always said what we do for charity and what we pay in taxes is community benefit."

But generally, non-profits serve more Medicaid patients than for-profits do, said Inzina, the BayCare CFO.

Even comparing among non-profits can be misleading, especially when it comes to specialty hospitals. All Children's Hospital's charity care looks low because in Florida, Medicaid is primarily for children, so more of their tab is government-funded. Around 70 percent of All Children's patients are on Medicaid.

And Moffitt Cancer Center's major research projects aren't included in its community benefit because the hospital operations file separately from the research program, said Moffitt chief financial officer Janene Culumber.

Short, the TGH executive, said non-profit hospitals also tend to run costly medical services, including burn units and Level 1 trauma centers. He said for-profit hospitals have less incentive to invest in such programs.

"They've got other people they're beholden to," he said.

Editor's note: HMA took over Bayfront Medical Center this year. An earlier version of this story referred to a different hospital at one point.

Jodie Tillman can be reached at [email protected] or (813) 226-3374.

Comments
Do not eat any romaine lettuce, the CDC warns

Do not eat any romaine lettuce, the CDC warns

Public health officials are now telling consumers to avoid all types of romaine lettuce because of an E. coli outbreak linked to the vegetable that has spread to at least 16 states and sickened at least 60 people, including eight inmates at an Alask...
Published: 04/20/18
Florida hits a milestone: More than 100,000 people are registered to use medical marijuana here

Florida hits a milestone: More than 100,000 people are registered to use medical marijuana here

Florida has hit a milestone of sorts as it slowly moves toward wider availability of medical marijuana.The number of patients in the state who are registered to use the substance has surpassed 100,000 for the first time, according to Florida Departme...
Published: 04/20/18
Florida Hospital Carrollwood spending $17.5 million to expand emergency department

Florida Hospital Carrollwood spending $17.5 million to expand emergency department

Florida Hospital Carrollwood is expanding its emergency department. The hospital, 7171 North Dale Mabry Highway in Tampa, is spending $17.5 million to add 15 new private treatment rooms, new pediatric rooms and waiting areas, and new technology, acco...
Published: 04/18/18
Barbara Bush’s end-of-life decision stirs debate over ‘comfort care’

Barbara Bush’s end-of-life decision stirs debate over ‘comfort care’

As she nears death at age 92, former first lady Barbara Bush’s announcement that she is seeking "comfort care" is shining a light — and stirring debate — on what it means to stop trying to fight terminal illness.Bush, the wife of former President Geo...
Published: 04/17/18
Preparing for the worst, staffers at Johns Hopkins All Children’s learn through simulation

Preparing for the worst, staffers at Johns Hopkins All Children’s learn through simulation

When the patient got violent, Dr. Michelle Hidalgo didn’t have time to think. She had to react. The woman was moving strangely and seemed erratic. Hidalgo had to make a tough call — it was time to physically restrain her for everyone’s safety.Then th...
Published: 04/16/18
Updated: 04/17/18

Lung cancer patients live longer with immune therapy

The odds of survival can greatly improve for people with the most common type of lung cancer if, along with the usual chemotherapy, they are also given a drug that activates the immune system, a major new study has shown.The findings should change me...
Published: 04/16/18
Thousands of pounds of prepackaged salad mixes may have been tainted with E. coli, officials say

Thousands of pounds of prepackaged salad mixes may have been tainted with E. coli, officials say

A Pennsylvania food manufacturer is recalling 8, 757 pounds of ready-to-eat salad products following an E. coli outbreak that has spread to several states and sickened dozens of people.Fresh food Manufacturing Co., based in Freedom, Pennsylvania, is ...
Published: 04/15/18
St. Anthony’s Cancer Center installs bell dedicated to survivors

St. Anthony’s Cancer Center installs bell dedicated to survivors

ST. PETERSBURGSister Mary McNally, vice president of mission at St. Anthony’s Hospital, stood in front of a room of cancer survivors to unveil a silver bell surrounded by butterfly stickers mounted to the wall of the Cancer Center lobby. "So often pe...
Published: 04/13/18
Hand dryers could leave your hands dirtier than you think

Hand dryers could leave your hands dirtier than you think

Washing your hands after you use the bathroom is a good idea. But using a public dryer could undo all that hard work, according to a new study.A study, published in the journal Applied and Environmental Microbiology, examined 36 men’s and women’s bat...
Published: 04/13/18
Meek and Mighty Triathlon draws the young (siblings who are 7, 9 and 11) and not so young

Meek and Mighty Triathlon draws the young (siblings who are 7, 9 and 11) and not so young

The annual St. Anthony’s Triathlon has for years attracted elite athletes from around the world, making the St. Petersburg race one of the premier triathlon events in the country. There’s a big incentive to run fast, swim hard and be the best on a bi...
Published: 04/13/18