Tuesday, March 21, 2023
The American Hospital Association's Non-Denial Denial
A non-denial denial is a statement that, at first hearing, seems to be a direct, clear cut and unambiguous denial of some allegation or accusation, but after being parsed carefully turns out to not be a denial at all, and is thus not explicitly untruthful if the allegation is in fact correct.
The American Hospital Association is out with its typical sort of non-denial denial to any suggestion that Nonprofit Hospitals might not really deserve tax exemption. Here is a snippet:
The highly respected international firm EY has looked at how the benefits tax-exempt hospitals provide stack up against their federal tax exemption. And every time EY confirms what an amazing return it is for taxpayers. Last year’s report showed the spread was 9 to 1 – for every $1 of exemption, reporting hospitals provided $9 of benefit to the community. Unlike a recent Kaiser Family Foundation (KFF) analysis that took a much narrower view, EY looked at the entire range of community benefits, not just financial assistance — a much fairer and more comprehensive way to measure how much hospitals give back. In addition, EY did not employ fuzzy math by lumping in charitable contributions to its calculations. These same funds would likely have been donated to perhaps less worthy purposes than hospitals so should not count as a loss to the U.S. treasury.
Another notable lapse was KFF’s analysis of state tax exemptions — always difficult to quantify given the differences in every state’s tax policy — because it fails to note the growing trend for hospitals and health systems to be asked to pay Payments in Lieu of Taxes (PILTs) to their local governments, some of which are very substantial. For example, hospitals in Boston paid over $20 million in PILTs in 2022 alone.
It’s a mystery why any analysis would focus on just the benefit of financial assistance and seemingly ignore everything else hospitals do for their communities. Didn’t we learn once again during the pandemic that hospitals are the first ones to step up to serve their patients and communities? Whether it was funding the development of COVID-19 tests after setbacks from public health agencies, expanding treatment capacity as COVID-19 cases surged, establishing vaccine clinics, or launching outreach campaigns to provide community-wide access to vaccines, hospitals are always there, ready to care. To downplay all the work they do to treat, heal, improve, and comfort their communities is a huge disservice to all who rely on our nation’s hospitals and health systems for care.
Oh, the disingenuity sir! The Kaiser Family Foundation report states quite clearly that it is comparing tax benefit to charity care. The AHA response perhaps proves the implicit point. That we have expanded the concept of community benefit so wide -- from actual charity care to even just putting up a "Smoking will kill you" billboard -- as to render community benefit an abstraction. And in our abstraction, we can assign whatever value we want to things other than the charity care's concrete dollar value, and thereby justify our existence by any possible measure other than charity care. I'm just saying.
By the way, if you want to sit in on a free webinar regarding whether nonprofit hospitals earn their exemptions, check out the Lown Institute Webinar happening next month. Click on the picture below for registration.