The Lown Institute, a nonpartisan healthcare think tank, released a new report March 26 examining the finances of more than 2,400 nonprofit hospitals in the U.S.
For the report, Lown calculated private nonprofit hospitals' "fair share spending" based on IRS form 990 for the fiscal year ending 2021 by comparing estimated value of hospital tax exemptions to money spent on meaningful community investments.
The analysis included the following IRS Schedule H categories: financial assistance, community health improvement services, cash and in-kind contributions, community building activities, and subsidized health services. Lown determined that those categories "are most likely to have a direct and meaningful impact on community health." Researchers excluded categories of Medicaid shortfall, health professions education, and research.
Financial report or CMS cost report information was used to calculate expenses and net income for hospitals filing with universities where IRS Schedule E was submitted. For group filings, hospital expenses and community investment spending were prorated across hospitals according to their share of financial assistance among hospitals filing under the same tax ID, based on CMS cost reports.
This year's report included more than 650 additional hospitals compared to last year. Newly included this year were Renton, Wash.-based Providence; Oakland, Calif.-based Kaiser Permanente; Somerville, Mass.-based Mass General Brigham; Edison, N.J.-based Hackensack Meridian Health; Cleveland Clinic; and Rochester, Minn.-based Mayo Clinic, among other hospitals and health systems.
Hospitals with at least 5.9% of overall expenditures dedicated to financial assistance and meaningful community investment were considered to have spent their "fair share."
Here are 10 hospitals that had the largest fair share surpluses, meaning their spending on community investments exceeded the value of their tax exemption in 2021, according to Lown. They are listed in descending order based on surplus amount.
Note: Hospitals with an asterisk next to them are those that had unusually high community investment spending in 2021 compared to previous years. Lown conducted outreach to better understand the programs and services to which this spending was attributed, and a response was not provided.
Lakeland (Fla.) Regional Medical Center*: $194 million
Summit Healthcare Regional Medical Center (Show Low, Ariz.)*: $159 million
Nebraska Medical Center (Omaha): $112 million
Hackensack (N.J.) University Medical Center: $96 million
North Shore University Hospital (Manhasset, N.Y.): $93 million
Jersey Shore University Medical Center (Neptune, N.J.): $83 million
Grady Memorial Hospital (Atlanta): $71 million
Mount Sinai Hospital (Chicago): $67 million
Englewood (N.J.) Hospital and Medical Center: $64 million
Saint Francis Hospital (Tulsa, Okla.): $54 million
Here are 10 health systems that had the largest fair share surpluses, meaning their spending on community investments exceeded the value of their tax exemption in 2021, according to Lown. They are listed with their headquarters and in descending order based on surplus amount.
Note: The list includes a tie.
Hackensack Meridian Health (Edison, N.J.): $358 million
Nebraska Medicine (Omaha): $119 million
Christus Health (Irving, Texas): $108 million
Wellstar Health System (Marietta, Ga.): $85 million
Northwell Health (New Hyde Park, N.Y.): $80 million
Sinai Chicago: $71 million
Saint Francis Health System (Tulsa, Okla.): $60 million
Houston Methodist: $54 million
Medisys Health Network (New York City): $54 million
Covenant Health (Knoxville, Tenn.): $48 million
More information about the report and methodology is available here.