WSJ: Private hospitals in the U.S. are moving from poorer neighborhoods to wealthier ones
Nonprofit hospitals in the United States are enjoying a tax break to “benefit the community,” but they often choose to leave less affluent neighborhoods in favor of more affluent locations, the WSJ reports.
Some of the larger nonprofit hospitals in the United States, which are supposed to provide free health care to the poor, are moving from poorer neighborhoods to wealthier ones, writes The Wall Street Journal, citing its own calculations.
Nonprofit hospitals pay no federal, state or local income taxes. They receive various benefits, and in return they must report to the Internal Revenue Service (IRS) that their activities “benefit the community.” The WSJ’s interlocutor among Johns Hopkins University researchers estimated the amount of tax breaks they receive at $8.8 billion.
The WSJ notes that a number of nonprofit hospital networks, such as CommonSpirit Health, Ascension, Bon Secours Mercy Health, have stopped owning or closed more than half of their locations in higher-poverty areas in recent years. At the same time, the St. Louis, Missouri-based Mercy network opened 56% of its new hospitals in lower-poverty areas. The same is true of Florida-based AdventHealth.
According to a CommonSpirit spokeswoman, the network is acquiring hospitals “that would otherwise face difficulties,” and about a quarter of the services it provides are covered by Medicaid insurance. A Mercy spokeswoman said the network strives to take care of as many patients as possible and takes into account hospital workloads. Ascension said that the income level of the population in a particular area does not affect the decision to close old or buy new hospitals.
The WSJ previously wrote about a number of cases in which hospitals purchased drugs at a discount under a federal program to help low-income patients, but medical facilities sold the drugs among affluent patients.
U.S. President Joe Biden signed legislation in August aimed at reducing inflation. Among other things, it provides for reduction of American health care costs, the document in particular is intended to increase the number of insured citizens by 3 million.