HEALTH CARE REFORM UPDATE:

New Regulations for Nonprofit Hospitals


Throughout the debate over health care reform, I had the pleasure of participating in weekly conference calls sponsored by the group Faithful Reform in Health Care (www.faithfulreform.org). A recent post-reform conference call focused on new standards for the “community benefits” provided by nonprofit hospitals. I am pleased to share with you what I learned: For some time now, 501(c)3 hospitals have been required by law to provide benefits to their communities in exchange for not paying taxes. Exactly what constitutes these benefits has varied tremendously and for the most has been left up to the discretion of hospital administrators and boards. While a great deal of discretion still remains, the Patient Protection and Affordable Care Act requires some important new regulations. Most notably, nonprofit hospitals must now conduct a Community Needs Assessment (CNA) every 3 years. There must be community input into this assessment, and the hospitals’ reported community benefits must be strategically designed to meet the specific needs identified by the assessment. All of this information must be made public. This is one of the few sections of the act that actually carries a sizable penalty, up to $50,000 for noncompliance. Additionally, nonprofit hospitals must provide written copies of their financial aid policies and specify their policies for debt collection. They must limit charges for emergency and medically necessary procedures to the uninsured to the amount that they would charge an insured patient, and they must also make a reasonable effort to see if a patient qualifies for their financial aid policy before they attempt to collect for services. Best of all, these regulations are some of the first parts of the act to go into effect, starting on the first day of the hospital’s tax year after the bill was signed. For some hospitals, this was April 1; for others, it will take effect in October.

Of course, these new regulations are not nearly as tight and standardized as many consumer advocates would like to see, but they are certainly a huge step forward. Additionally, there are now new ways for patient advocates to be involved. Contact your local hospital and ask to be connected to the person who will be in charge of the community assessment, and then request to be a part of the process. Groups like Community Catalyst (www.communitycatalyst. org), which helped staff the conference call I was on, will keep people updated about opportunities to submit comments to the I RS and other regulatory authorities. Finally, a shout out to the good folks in the Catholic Hospital Association (www. chausa.org)! While the American Hospital Association was opposed to these new regulations and will certainly be fighting to make sure all future definitions are as broad as possible, Catholic Hospitals have been a model for Community Benefits since the 1980s and fully supported these new requirements. So if you have experience working with your local Catholic institution on these projects, think about sharing your best practices with other nonprofit hospitals in your area. Many of our hospitals in north-central Pennsylvania are nonprofit, including Williamsport Hospital (and other hospitals in the Susquehanna Health System) and Evangelical Community Hospital in Lewisburg. Now members of the communities they serve have a chance to be more involved in making sure that they live up to their obligations as nonprofit institutions. Marissa Harris Krey works in Harrisburg for the Lutheran Advocacy Ministry in Pennsylvania (LAMPa), in partnership with the Pennsylvania Health Access Network (PHAN).