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					            P.S.S.T*
 The IRS Community Benefit Laws



Presenter Disclosures
Daniel Hodgkins
No relationships to disclose


                   Daniel Hodgkins
                   Vice President Community Benefit and Economic Redevelopment
                   dhodgkins@ecommunity.com
           P.S.S.T*
The IRS Community Benefit Laws
                            Planning
                          Sustainable
                           Strategies
                             Through
       the IRS Community Benefit Laws

            Daniel Hodgkins
            Vice President Community Benefit and Economic Redevelopment
            dhodgkins@ecommunity.com
Health Reform
  Three Goals distilled from 2,000 pages of
                  PPACA!
(Patient Protection and Affordable Care Act)

•Increase Access

•Bend the curve on the cost of care

•Improve the health of the community
Health Reform & Community Benefit
 Transition:
      from nice to have
                           to need to have
      from “funny money”
                           to real money
      from “tables and T-shirts”
                           to strategic planning
      from medical model
                           to social justice
      from antidotes
                           to measurable outcomes
Health Reform & Community Benefit
Are charitable organizations benefiting the broad
public interests?

Who is demanding accountability and transparency
from non-profit hospitals?
                                                       Fair
                                                     Economic
General Public              Consumer Groups         Opportunities

State laws and policies     State Attorney General
Lawsuits                    Congress
Unions                      IRS
Community Benefit
Congressional Questions…

   “…tax exempt status is a privilege …By gathering
information from non-profit hospitals, I hope to learn
whether the benefits they provide to the needy justify
                         the tax breaks they receive.”
                                                    Fair
                                                  Economic
    “…I am concerned about the extent to which non
                                                 Opportunities
profit hospitals are providing services and benefit to
  the public commensurate with their favored federal
                                          tax status.”
                                   Senator Charles Grassley (R-IA)
Community Benefit
Current Questions…

                                Rationale for charges
                       Billing and Collection Policies
                                 Charity care Policies
                                                    Fair
                                    Bad Debt Policies
                                                  Economic
                                                 Opportunities
                             Executive Compensation
                                       Joint Ventures
          Fulfilling Community Benefit Expectations
Community Benefit
  Current Questions…

            Fulfilling Community Benefit Expectations
  Community Benefit Standard Revenue Ruling 69-545

                                                                    Fair
  •Neither Code nor Regulations explicitly provide for exemption of
                                                           Economic
  hospitals.                                              Opportunities

  •Original IRS interpretation of charitable: relief of the poor.
  •Rev. Rul. 56-185 –exemption for hospitals that accepted patients
  without ability to pay to the extent of their financial ability.
  •Hospital must benefit class broad enough to benefit community and
  be operated for public rather than private interests to be exempt.
Community Benefit
  Current Questions…

            Fulfilling Community Benefit Expectations
  Community Benefit Standard Revenue Ruling 69-545

                                                                Fair
  •Community Board                                            Economic
  •Open medical staff                                        Opportunities

  •Emergency room open to all regardless of ability to pay
  •Hospital otherwise admits patients able to pay, either themselves
  or through insurance, Medicare or Medicaid
  •Excess funds applied to facilities, patient care, medical training,
  education & research
   IRS Schedule H (Form 990)



8 Pages, 8 pt font, VI Parts, 130 Questions, 8 worksheets
                                                Fair
                                              Economic
                                             Opportunities
IRS Schedule H (Form 990)

…All talking, all singing, all dancing

                         Inspired by the first Hollywood musical
                                       “Broadway Melody 1929”
 Meaning a very advanced machine with all the bells and whistles
                                    ..and some not necessary!
Community Benefit
                  Resource Available Online

             http://www.chausa.org/communitybenefitguide/

                             CHA/VHA
                            Issued 2006
                           Revised 2008
                  New Revision Post IRS Definitions
Community Benefit
Community Benefit
Community Benefit
Community Benefit Objectives:

Programs or activities that:
      provide treatment
      promote health
      as a response to community needs.
…and meets at least one community objective
      improve access to health services
      enhance public health
      advance knowledge
      relieve government burden
Community Benefit
Not A Community Benefit:

•   Provided primarily for marketing purposes
•   Required for licensure or accreditation
•   Restricted to individuals affiliated with organization
•   Not related to community benefit mission
•   Counted as community benefit by another organization
    or person
•   Questionable in the eyes of the community (laugh test)
Community Benefit Report
 How School Based Health Services Fit…
 Do you have a financial assistance policy?

 Does it provide for free or discounted care?

 Does it use Federal Poverty Guidelines?

 Who receives assistance?

 How much and how many people did it serve?

 How is the policy publicized?
Community Benefit Report
  How School Based Health Services Fit…
  Are you providing subsidized health services ? (clinical
    services provided despite a financial loss to the organization. The
    financial loss is measured after removing losses, measured by cost,
    associated with bad debt, charity car, Medicaid and other means tested
    government programs)

  Leadership development and training? (for community
    members may include training in conflict respolutions, civic, cultural or
    language skills, and medical interpreter skills for community residents)

  Coalition Building? (participation in community coalitions and
    other collaborative efforts with the community to address health and
    safety issues)
Community Benefit Report
How School Based Health Services Fit…
How do you contribute to community health improvement ?
 (may include efforts to support policies and programs to
 safeguard or improve public health, access to health care
 services, the environment, and transportation)

Do you provide opportunities for health profession training
 and education?

Do you do any research?

What is your budget and are there efficiencies due to school
 partnership
Community Benefit Report
How School Based Health Services Fit…
Do you provide any community support ? (may include child
 care and mentoring programs for vulnerable populations or
 neighborhoods, neighborhood support groups, violence
 prevention programs, and disaster readiness and public health
 emergency activities, such as community disease surveillance or
 readiness training beyond what is required by accrediting bodies
 or government entities)

Do you have any data to share? (Community health
 information, productivity, problem lists, population served,
 demographics etc.)
Community Benefit
 Writing a letter…
Community Benefit

 How many dots are there in the picture below?
Community Benefit
Doing the research…

Closest not for profit hospital or hospital network…

Do they have a community benefit report on their
website?

Do they have a person dedicated to community
benefit? Who do they report to?
Community Benefit
Doing the research…

Are they a county hospital?

Who is there CEO, CFO & Marketing Director?

Does their mission statement have the word
community in it?
Community Benefit
Writing a letter…

Address to the CEO, CFO and Community Benefit
Manager.

Summarize the information gathered.

Include a report if enough data available.

Schedule follow up call to make appointment for a visit.
Community Benefit
Agenda for meeting…

Bring along partners ( parents, teacher, principal
community partner).

Review letter and data.

Ask for community benefit commitment and strategy.

Look for the fit…   attain sustainability!
Community Benefit



…the beginning
Acknowledgements
           Patsy Matheny LLC
      Community Benefit Consultant
     patsymatheny@columbus.rr.com
              740-746-0286

				
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posted:8/31/2011
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