“When a community understands more about the breadth of their local providers’ roles, state legislators realize they will not win constituents by assailing them.”
Go public with your community benefit
When your hospital has gone the extra mile to respond to community needs, work with your media and community relations teams to get the story out. Expand beyond posting on your website by using awareness advertising and social media. In many areas, not-for-profit health systems not only provide vital medical services but also are the largest employers in the local area. These positive points should not go unnoticed, said Mary Torretta, Grant Thornton Tax leader and principal in Healthcare Tax Services: “When a community understands more about the breadth of their local providers’ roles, state legislators realize they will not win constituents by assailing them.”
COVID-19 outreach has generated many positive stories for healthcare systems. For example, nonprofit hospitals have reallocated resources to community vaccination efforts, reassigned staff to assist in COVID-19 efforts, and made cuts in pay and benefits for highly compensated employees. These were the kinds of actions taken by two Minnesota healthcare systems. To continue to serve patients in the thick of the pandemic, Mayo Clinic, Minnesota’s largest employer, cut pay for one-third of its workers and furloughed others — and continued providing support in intensive-care units often filled or near capacity and having to enact significant system changes. And CentraCare exercised creative resource planning, requested (successfully) voluntary pay and benefit cuts, delayed projects and lined up bridge loans. Conduct research about such activities within your hospital to report them loudly and clearly.
Besides the impact on hospital facilities, COVID-19 has changed the way patients interact with affiliated physician practices. Make it known if your hospital extended financial assistance to your physician practices to subsidize additional medical care related to COVID. This is a compelling example of community benefit and should be included in your Schedule H presentations.
Revisit your CHNA
CHNAs are generally prepared every three years. Common areas of focus include long-term critical health matters such as obesity, diabetes and mental health. Pandemic responsiveness has not historically been identified as a significant community need, but because of the COVID-19 experience, we may see a shift of priorities to include preparation for infectious diseases as a primary community need. Think about expanding who has a voice in your CHNA. Consider including additional community leaders who have been involved or have evolved out of pandemic response.
The pandemic will pass; your proof must be permanent
Be prepared for a future of increased scrutiny. Create a plan for both the short- and long-term protection of your tax-exempt status.
Resources you already have in place — the CHNA, Form 990 and community relations professionals — can spread the word about actions benefiting your community even as circumstances change. Your plan can support your hospital’s financial health through the challenges ahead.