Understanding the Difference: Charity Care and Community Benefit 02/07/2005
I’m Doug Hawthorne, president and CEO of Texas Health Resources, with “The Business of Health Care Report.”
In the coming months, you’ll hear the terms “charity care” and “community benefit” discussed in conversations about health care on local, state and national levels. Specifically, the discussions will consider whether nonprofit hospitals deserve tax-exempt status.
Here’s a quick description of what charity care and community benefit mean. “Charity care” is medical care provided free or at a reduced charge on a case-by-case basis to individuals who meet financial eligibility terms. The emergency department is where most charity care is provided, and it is among the most expensive sites for health care. Yet, uninsured and underinsured patients frequently turn to hospital emergency departments for primary care because they have no ongoing physician relationship.
The term “community benefit” refers to efforts made by nonprofit hospitals and organizations to serve both the individual and the community by reaching outside hospital walls with wellness and prevention programs designed to keep people healthy. Whether it’s blood pressure and cholesterol screenings, smoking-cessation programs in schools, asthma control or diabetes education, these programs have one goal: to keep people out of the hospital in the first place.
Join me next week for a conversation on how charity care impacts nonprofit health care organizations, the health care industry as a whole and our communities.
For Texas Health Resources and its faith-based hospitals – Harris Methodist, Presbyterian and Arlington Memorial – I’m Doug Hawthorne.