25 hospitals where charity care falls behind tax breaks

Lown Institute, a nonpartisan healthcare think tank, released a new report April 11 examining the finances of 1,773 nonprofit hospitals in the U.S. The report — which does not include large health systems like Renton, Wash.-based Providence; Oakland, Calif.-based Kaiser Permanente; Somerville, Mass.-based Mass General Brigham; Cleveland Clinic; and Detroit-based Henry Ford — found that some hospitals fell short on and others exceeded expected investments in their communities.

For the report, Lown calculated private nonprofit hospitals' "fair share spending" based on 2020 IRS Form 990 by comparing the estimated value of hospitals' tax exemptions to spending on financial assistance and meaningful community investment — including community health improvement activities, contributions to community groups, community-building activities, and subsidized healthcare services. IRS categories of Medicaid shortfall, health professions education and research were not included.

Lown said expenses, income and community investment data were prorated across hospitals for hospitals that file as a group, based on their share of system revenue. Financial audit or CMS cost report information was used to calculate expenses and net income for hospitals filing with universities where Schedule E was submitted. Providence, Kaiser Permanente, Mass General Brigham, Cleveland Clinic and Henry Ford were not included in the report because 2020 IRS filings were unavailable.

Lown considered hospitals that dedicated at least 5.9 percent of overall expenditures to charity care and meaningful community investment as spending their fair share. More information on the methodology is available here

Here are 25 hospitals that had the largest "fair share" deficits, meaning their spending on charity care and community investment was less than the value of their tax exemption in 2020, according to Lown. They are listed in descending order based on deficit amount. Note: The list includes ties. 

1. UPMC Presbyterian Shadyside (Pittsburgh): $246 million

2. NYU Langone Hospitals (New York City): $173 million

3. Vanderbilt University Medical Center (Nashville, Tenn.): $158 million

4. Hospital of the University of Pennsylvania (Philadelphia): $151 million

5. Indiana University Health (Indianapolis): $136 million

6. Spectrum Health Butterworth Campus (Grand Rapids, Mich.): $134 million

7. Cedars-Sinai Medical Center (Los Angeles): $126 million

8. M Health Fairview University of Minnesota Medical Center (Minneapolis): $119 million

9. UMass Memorial Medical Center (Worcester, Mass.): $114 million

10. Arizona General Hospital Mesa: $102 million

11. Northwestern Memorial Hospital (Chicago): $97 million

12. Strong Memorial Hospital (Rochester, N.Y.): $91 million

13. Froedtert Hospital (Milwaukee): $87 million

14. ChristianaCare Health Services (Newark, Del.): $85 million

14. Lehigh Valley Hospital (Allentown, Pa.): $85 million

16. Abbott Northwestern Hospital (Minneapolis): $83 million

17. Montefiore Hospital (New York City): $82 million

18. University of Maryland Medical Center (Baltimore): $79 million

19. Hartford (Conn.) Hospital: $78 million

19. Atrium Health Wake Forest Baptist Medical Center (Winston-Salem, N.C.): $78 million

21. Our Lady of the Lake Regional Medical Center (Baton Rouge, La.): $76 million

22. The University of Chicago Medical Center: $71 million

23. Thomas Jefferson University Hospital (Philadelphia): $69 million

23. Scripps Memorial Hospital La Jolla (Calif.): $69 million

23. Loma Linda (Calif.) University Medical Center: $69 million

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