John Auerbach: A Q&A on Community Benefit
Non-profit hospitals are required to provide a “community benefit” to qualify for tax-exempt status with the Internal Revenue Service. The Patient Protection and Affordable Care Act includes provisions for expanded community benefit opportunities with a focus on improving community and population health.
Massachusetts has had a similar community benefit provision at the state level for decades. NewPublicHealth recently spoke with Massachusetts State Health Commissioner John Auerbach, DPH, about what other states can learn from Massachusetts’ experience, particularly regarding the benefits – and challenges – of critical collaboration between public health departments and hospitals and other health care institutions.
NewPublicHealth:Massachusetts may have a leg up on some states when it comes to community benefit. Can you give us some background on that?
John Auerbach: The state Attorney General has long had community benefit guidelines that direct hospitals to address the non-hospital-based health and social needs of their patients. Consequently every hospital has been accustomed to implementing community benefit projects that follow the Attorney General’s criteria aimed at improving population or community health.
In addition, the Determination of Need “community initiative” requirement, overseen by the Department of Public Health, mandates that hospitals include a set-aside budget focused on population or community health as a component of every major capital expenditure.
NPH: So, if I were head of a Massachusetts hospital and I had a community benefit initiative and then I decided to add a wing of 50 rooms, say, I would then be required to plan an additional, brand new community initiative.
John Auerbach: That’s right. Something that they’ve previously done to fulfill the Attorney General’s community benefit requirement would not be acceptable to us. We have an established set of criteria they must meet, such as attention to the elimination of health disparities. And, they must demonstrate that they’ve reached out to and involved the community in the planning and decision-making process.
NPH: What are the implications of the new IRS requirements, and how do they differ from the Massachusetts state requirements?
John Auerbach: To meet the IRS requirement hospitals need to do a comprehensive assessment of need, to identify the key gaps and to present information about how they’re going about filling those gaps. Some hospitals have already done some components of these requirements. Where new efforts are called for, we are encouraging the hospitals to talk with us and with local public health and to accomplish these new tasks in a coordinated way.
For example, in Boston we have multiple hospitals with overlapping catchment areas. Rather than each hospital doing a needs assessment and gap identification that is more or less identical to each other, we have joined the Boston Public Health Commission in requesting a division of labor among the hospitals. That way each hospital could delve more deeply into the analysis of a particular neighborhood.
The IRS requirement could ideally be used to assist us in developing a more rational health assessment plan for local communities and the state with shared goals and health outcomes. If we could achieve even a small fraction of that approach, it would be a good model for the rest of the country.
NPH: And where does that stand?
John Auerbach: We’re in the midst of having discussions with the hospitals right now.
NPH: Would you say that this initiative builds on the significant need for partnerships to improve population health?
John Auerbach: Yes, I think it offers potential. But in order to achieve the potential there needs to be stronger communication and partnership that’s built among the hospitals, local and state public health agencies and grassroots organizations. And, not surprisingly, in Massachusetts and around the country we are seeing evidence that this is being approached very unevenly. There are best practices and really good examples, but there also are examples of hospitals that are viewing this as a perfunctory task. Some are taking it very seriously. We have had some hospitals that have used this moment to build strong bridges to population health efforts—putting more resources into community-level endeavors to promote healthy eating and active living and to reduce violence. But other hospitals are likely to do the minimum necessary in order to meet the IRS requirements, with very little outreach to the community or to the public health departments.
This is made more challenging because in some parts of the country the local and state public health agencies are either too small or too negatively affected by cuts to have the resources to take advantage of this opportunity and reach out to their hospitals.
But, don’t get me wrong. I think it’s a good thing that the IRS requirements exist. They offer one more tool to achieve the intended outcomes of health reform and specifically to promote good health and avoid unnecessary health complications or premature death in the communities that are served by the hospitals.
NPH: Is one of the worthwhile challenges of these partnerships working through different partners’ agendas and priorities in order to get to the best results?
John Auerbach: There is no getting around the fact that there’s tension that exists in building these partnerships. We are developing a new paradigm, which closely links high quality, accessible health care with population-based efforts to promote wellness in families, in neighborhoods and at work and at school. Sometimes there is a tendency for each organization to position itself as the one that is making the biggest difference. We have had those awkward moments when a hospital, a community group or a public health agency has claimed credit for a positive outcome, when it was really the result of numerous organizations and individuals. Building these new partnerships takes energy and work and can get messy sometimes. But even though there are complications, it’s worth it when the stakes are so high to improve the health of our communities.