Trinity Health recorded higher revenue and operating income in the first quarter of fiscal year 2020 than in the same period a year earlier, but the Livonia, Mich.-based system ended the quarter with lower net income, according to unaudited financial documents.
During the first quarter of fiscal 2020, which ended Sept. 30, Trinity reported operating revenue of $4.8 billion, a 1.8 percent increase over the same period of the year prior. Operating expenses climbed 1.7 percent year over year to $4.7 billion.
Trinity ended the first quarter of fiscal 2020 with operating income of $94 million, up from $87 million in the first quarter of last year.
The system reported an operating margin of 2 percent in the first quarter of fiscal 2020, compared to an operating margin of 1.8 percent in the same period of the year prior. Margin growth was partially attributable to Trinity’s divestiture of Camden, N.J.-based Lourdes Health System in June. Growth in patient volumes and payment rates also supported margin growth.
After factoring in nonoperating items, including a decline in investment returns, Trinity reported net income of $166.4 million in the first quarter of fiscal 2020. That’s compared to the first quarter of fiscal 2019, when the system posted net income of $419.9 million.
The Residences at Camelback West in Phoenix has 500 rental units ranging from studios to two-bedroom apartments, of which 100 are set aside for homeless UnitedHealth Medicaid members. Photo: Tiempo Development & Management
In the course of a single year, a homeless man named Steve in Phoenix, Arizona, visited the emergency room 81 times. Only 54 years old, Steve is coping with a daunting array of medical conditions: multiple sclerosis, cerebral palsy, heart disease, and diabetes. Because of his health and reliance on emergency rooms, his medical costs averaged about $13,000 per month that year.
Thanks to an innovative housing program run by the nation’s largest health insurer, UnitedHealth Group, Steve no longer sleeps outside — a crucial prerequisite to improved health. He is one of about 60 formerly homeless people covered by Arizona Medicaid who now receive housing and support services in Phoenix, John Tozzi reported for Bloomberg Businessweek. The UnitedHealth housing program, called myConnections, represents the growing recognition across the health care system that improved health cannot be achieved exclusively by traditional clinical models. Getting patients off the streets is often the first — and most important — step to helping them heal, physically and mentally.
“Patients like Steve wind up in the ER because they don’t fit into the ways we deliver health care. . . . [The US system] is not set up to keep vulnerable people housed, clothed, and nourished so they’ll be less likely to get sick in the first place. —John Tozzi, Bloomberg News
“Patients like Steve wind up in the ER because they don’t fit into the ways we deliver health care,” Tozzi explained. “The US system is engineered to route billions of dollars to hospitals, clinics, pharmacies, and labs to diagnose and treat patients once they’re sick. It’s not set up to keep vulnerable people housed, clothed, and nourished so they’ll be less likely to get sick in the first place.”
MyConnections was the brainchild of a partnership between UnitedHealthcare (a division of UnitedHealth) and the Camden Coalition, a New Jersey–based nonprofit dedicated to improving care for people with complex health and social needs. The partnership was established in 2017 at the same time Jeffrey Brenner, MD, founder and executive director of the Camden Coalition, announced he was leaving the nonprofit to lead myConnections. He is now UnitedHealthcare’s senior vice president for integrated health and human services. UnitedHealthcare provides managed care to about six million people nationwide, according to company filings. It does not get reimbursed by Medicaid for housing assistance.
Making the Case for Addressing Social Determinants
Brenner hopes myConnections will show that both a health care and a business case can be made for investing in a Housing First (PDF) model. Tozzi reported that UnitedHealth “aims to reduce expenses not by denying care, but by spending more on social interventions, starting with housing.”
At the Residences at Camelback West, a Phoenix apartment complex of 500 apartments ranging from studios to two-bedroom units, up to 100 apartments are set aside for UnitedHealth Medicaid members enrolled in myConnections. The rest of the units are rented out at market rates. Five health coaches use an on-site office to serve as case managers and counselors for the myConnections residents. The coaches make sure that their clients remember medical appointments, and arrange transportation for them and sometimes accompany them to the doctor.
Since receiving housing and health coaching from Brenner’s team, Steve’s average monthly medical costs have dropped from $12,945 to $2,073. An analysis of the first 41 participants in Phoenix shows that “housing and support services proved cost effective for the 25 most expensive patients, reducing their overall costs dramatically,” Tozzi reported. But total spending for the other 16 increased, highlighting the complexity of this work.
“The return’s only going to work out if we target the right people,” Brenner told Tozzi. The myConnections team selects patients who are enrolled in UnitedHealth, are homeless, and who have annual medical spending greater than $50,000 mostly because of ER visits and inpatient stays. Those high-cost patients are UnitedHealth’s best bet for recovering the cost of its housing investment.
UnitedHealth is starting with 10 subsidized apartments in each new city where it’s introducing the program, including in places where there might be hundreds of homeless Medicaid members on its rolls, Tozzi reported. MyConnections will be in 30 markets by early 2020.
Kaiser Addresses Homelessness in Its Backyard
In its home base of Oakland, California, health system Kaiser Permanente has invested $200 million in an affordable housing project, Hannah Norman reported in the San Francisco Business Times. Its help is not targeted exclusively at Kaiser members, instead aiming to benefit any residents who live in communities it serves.
The initiative was championed by Bernard Tyson, the late chairman and CEO of Kaiser, who died unexpectedly this month. In a New York Times remembrance, Reed Abelson noted that Tyson was committed to addressing social determinants of health in the places where Kaiser operates. “He had the organization examine broad issues like housing shortages, food insecurity, and gun violence and their impact on health and well-being,” Abelson wrote.
Tyson, who was the health system’s first Black chief executive, served as chair of the Bay Area Council, a business association dedicated to economic development in the San Francisco region. His chairmanship culminated in a major report (PDF) that documented the severity of the homelessness crisis and recommended ways to address it, Norman reported.
“We don’t believe as a mega-health system that our only lane is medical care,” Tyson said in April. “It’s a critical lane, but it’s not our only lane.”
Steady Rents in Buildings with Seismic Upgrades
Kaiser announced its $200 million housing initiative, the Thriving Communities Fund, in January. Since then, it partnered with Enterprise Community Partners, a nonprofit organization focused on affordable housing, and the nonprofit East Bay Asian Local Development Corporation to invest a total of $8.7 million ($5.2 million from Kaiser) in Kensington Gardens, a 41-apartment building in East Oakland. “The trio of organizations plans to keep the residents in place and the rent steady at $1,597 per month for a studio and $2,250 for a two-bedroom,” Norman wrote. “Some residents receive federal housing benefits, including Section 8, to help cover the cost.”
The Kensington Gardens purchase is part of the Thriving Communities Fund’s strategy to keep rents steady and to make health and safety upgrades such as seismic upgrades and new roofs.
Kaiser’s Built for Zero initiative committed $3 million over three years to a data-driven, county-level approach to understanding the dynamics of homelessness. Built for Zero tracks the homeless population in a county from month to month to understand “who they are, what they need, and even how many of them are repeatedly visiting emergency rooms,” Norman reported. Fifteen Kaiser communities, including eight in California, are participating in the program.
The idea of “Medicare for all” advanced another step with the recent release of Sen. Elizabeth Warren’s more detailed health proposal. It is expansive and bold, and has brought some excitement to the progressive core of the Democratic Party. While policy mavens can delight in the details, the enormity of the proposal is a sign that this debate has clearly gone off the rails.
There is no question that healthcare cost is a pocketbook challenge for all of us. Employer and employee premiums for private health insurance for a household now average $20,576, before deductibles and copayments, and before payroll and state and local taxes to pay for healthcare for the elderly and the poor.
National health expenditures increased 179% between 2000 and 2019 to $3.8 trillion, and 50% of this increase was directly due to increases in unit prices and service intensity by hospital systems and physicians. In the U.S., healthcare is 28% more expensive than the next highest cost system, Switzerland, and 78% more expensive than in Germany. For a primary care doctor in the U.S., submitting invoices to insurers and collecting payments costs almost $100,000 per year.
What we should be debating — instead of the politics around Medicare for all — is how this market evolved in such a malignant direction, and whether anything can be done to change these trends.
Hospital consolidation has been shown to drive up healthcare costs, and yet 90% of U.S. hospital markets are highly consolidated. Physician employment by hospitals and health systems has increased from 26% to 44% of the market from 2012 to 2018, increasing the pricing leverage of consolidated systems even further.
These changes directly result in higher prices for commercial health insurance as hospitals use their exaggerated hospital “charges,” often many multiples of their costs or of the market price, to drive up their reimbursement rates for in-network care and especially for out-of-network care, where there is no price negotiation. Further, even at most not-for-profit healthcare systems, hospital leaders are compensated based on the profits they generate, not premiums they reduce, as is the case with leaders of for-profit hospital systems.
The pharmaceutical market has also come under scrutiny for the enormous prices of newly approved medications, and for price increases of existing medicines such as insulin. Behind the scenes are layers of businesses that further exploit this market. For example, one pharmaceutical benefit manager (a company hired by a health plan or employer to oversee prescription drug benefits) reported profits of $1.8 billion in 2013 that rose to $4.5 billion in 2017 despite a 4% reduction in revenue reported over this period.
It’s easy to see that consumers need relief from this market. One might imagine that politicians from both political parties would band together in a search for actionable solutions. Yet the debate has migrated from a discussion of why costs are spiraling out of control to a simple and unrealistic answer — Medicare for all. Here are some ideas on how to frame a meaningful discussion about costs.
Reducing administrative costs has been a stated policy goal of the federal government since the passage of the Health Insurance Portability and Accountability Act (HIPAA) in 1996, yet these costs continue to increase. To reduce these costs, we have to simplify the complexity of the billing process for hospitals and physicians across the multiple different health plans in the market, and we need to transform the expensive set of public data reporting mandates into a model in which we are assured these data are used by providers internally to improve the quality of care they provide.
We need to rebalance negotiating power between hospitals and physicians and insurers. Hospitals and other providers have been allowed to set their list prices without any relationship to the cost of care they provide. These inflated prices are then imposed on out-of-network patients, most egregiously in the practice of surprise medical billing in which patients encounter deliberately out-of-network air ambulances and independent anesthesiologists. In billing disputes, state law should offer these patients a default of a market price closer to Medicare payments than to hospital charges.
Finally, it’s time to stop the practices that are driving up prescription drug costs for all of us. Secret payments between pharmaceutical manufacturers and pharmaceutical benefit managers and distributors totaled over $100 billion in 2016. This business model needlessly inflates drug prices for the benefit of intermediaries in the market. We need laws requiring price transparency at the pharmacy for brand and generic drugs, and price competition for medications at the retail level.
The problem with focusing on Medicare for all is that rather than developing practical approaches, the debate is heading down a path likely to leave us without any tenable solutions to address healthcare costs — the issue that ignited the public’s interest in the first place.
Hospital beds are not filling up like they used to, but that doesn’t mean hospitals want their beds to be empty, Axios’ Bob Herman reports.
What they’re saying: Even though more patients are being treated in outpatient clinics rather than hospitals, “we’ll still be able to keep our beds pretty full,” Don Scanlon, chief financial officer at Mount Sinai Health System, said this week at an investor lunch held at Goldman Sachs headquarters in New York City.
Details: Mount Sinai, a not-for-profit hospital system based in Manhattan with $5 billion in annual revenue, is preparing to sell $475 million in bonds, and was making its pitch to bondholders about why buying that debt would be a good deal.
Between the lines: Mount Sinai’s discharges have trended down, but the hospital doesn’t want to lose the bigger dollars tied to inpatient stays. And the system wants to reassure municipal investors they will see returns.
As a result, Mount Sinai has invested more money in outpatient centers in other parts of New York that serve as “feeders” for its main city hospitals, Scanlon said.
The bottom line: Mount Sinai, Trinity Health, Banner Health and a host of other hospital systems have openly touted plans to boost or retain admissions even though they say they want to keep people out of the hospital. This is a fundamental disconnect between “value-based care” and the system’s financial incentives.
UPDATE: Nov. 13, 2019: This brief has been updated to include comments from provider groups.
Dive Brief:
CMS proposed a new rule Tuesday that would establish stricter requirements for states to report information on supplemental Medicaid payments to providers in a bid to clamp down on spending and promote transparency.
The agency will also soon release guidance on how states can test alternative financing approaches in the safety net program like block grant and per-capita cap proposals for “certain optional adult populations,” CMS Administrator Seema Verma said Tuesday at the National Association of Medicaid Director’s annual conference in Washington, D.C.
Later this year, CMS will also issue guidance on how states can promote value-based payments and social determinants of health factors in Medicaid, Verma said. The Center for Medicare and Medicaid Innovation is currently developing several new payment models to push providers to take on more risk for their patient populations in those programs.
Dive Insight:
The moves are in line with sweeping changes from the Trump administration moving more power to the states and asking more from recipients. The CMS administrator teased late last month the agency would soon release new guidance for states to inject flexibility into their Medicaid programs.
“We shouldn’t ration care but instead make how we pay for care more rational,” Verma said Tuesday. “Medicaid must move toward value-based care.”
Speaking to the Medicaid directors Tuesday, Verma said the changes are aimed preserving Medicaid for future generations.
“Going forward there will be no new [State Innovation Model] grants, no more open-ended one-off district waivers,” she said. “We must move forward with a more unified, cohesive approach across payers, across CMS, across states.”
The proposed rule, called Medicaid Fiscal Accountability (MFAR), will add more scrutiny to supplemental payments, which are Medicaid payments to providers in addition to medical services rendered to Medicaid beneficiaries, such as payments supporting quality initiatives or bolstering rural or safety net providers.
Some states rely heavily on these additional payments to offset low Medicaid reimbursement or support struggling hospitals. Provider lobbies did not take kindly to the new rule.
“We share the government’s desire to protect patients and taxpayers with transparency in federal programs, but today’s proposal oversteps this goal with deeply damaging policies that would harm the healthcare safety net and erode state flexibility,” Beth Fledpush, SVP of policy and advocacy for America’s Essential Hospitals, said in a statement.
AEH, which includes more than 300 member hospital and health systems, many of which are safety net providers, asked CMS to withdraw the proposal. The American Hospital Association told Healthcare Dive it was still reviewing the rule and declined comment.
However, government oversight agencies like the Government Accountability Office and the Office of Inspector General have recommended changes to these payments, which have increased from 9.4% of Medicaid payments in 2010 to 17.5% in 2017, according to CMS.
MFAR would also propose new definitions for “base” and “supplemental” payments in order to better enforce statutory requirements around and eliminate vulnerabilities in program spending.
Verma has long teased CMS support of block grants, an idea popular with conservatives, but Tuesday’s speech solidifies the agency’s support of such proposals. A handful of red states have been mulling over capped spending to gain more clarity around budgets.
In September, Tennessee unveiled its plan to move to a block grant system that would set a floor for federal contributions adjusted on a per capita basis if enrollment grows. Any savings would be shared between the state and the government.
Tennessee must submit a formal application to CMS to later than Nov. 20. If approved, it would become the first state to use a block grant funding mechanism in Medicaid. Additionally, Utah submitted a waiver application seeking per-capita Medicaid caps in June; Oklahoma Gov. Kevin Stitt, a Republican, is reportedly considering such a program; and Alaska and Texas have both commissioned block grant studies.
The Office of Civil Rights of HHS is asking for more information about Google’s “Project Nightingale” with St. Louis-based Ascension, according to a Nov. 12 The Wall Street Journal report.
Investigators “will seek to learn more information about this mass collection of individuals’ medical records to ensure that HIPAA protections were fully implemented,” OCR Director Roger Severino told WSJ.
Ascension and Google partnered last year to gather and share patient information to create healthcare solutions. Physicians and patients from 21 Ascension locations were not informed that information was being shared with Google. It is estimated that Google will gather data on 50 million patients.
Patient data that is being secretly shared with Google includes lab results, diagnoses and hospitalization records, reports WSJ. In some instances, Google has access to patients’ complete health history, including names and dates of birth.
Although Ascension employees have questioned the ethical and technological ways Google is gathering data, privacy experts said it appears to be acceptable under federal law. Hospitals are generally allowed to share data with business partners without informing patients if the information is used “only to help the covered entity carry out its healthcare functions.”
An Ascension spokesperson said patient data wouldn’t be used to sell ads, reports WSJ.
“We are happy to cooperate with any questions about the project. We believe Google’s work with Ascension adheres to industry-wide regulations (including HIPAA) regarding patient data, and comes with strict guidance on data privacy, security and usage,” a spokesperson for Google said in a statement to WSJ.
Legislators on Nov. 12 also commented on the project. Presidential hopeful Sen. Amy Klobuchar of Minnesota said that there needs to be government oversight for the amount of data Google is handling, adding there are “very few rules of the road in place regulating how it is collected and used.”
Google has mapped out plans to develop a search tool that would aggregate patient data into a central location. Ascension physicians would then be able to use the tool to more quickly access patient information.
Ascension leader Eduardo Conrado, executive vice president of strategy and innovations for Ascension, shared his reactions to the WSJ Nov. 11 report on Project Nightingale on Nov. 12. Find his commentary here.
Program offered for medical students who’ll commit to primary care at the Pennsylvania-based health system after graduating.
KEY TAKEAWAYS
The program will pick 40 first- and second-year students in each medical class through a competitive application process.
Selection criteria include financial need, academic merit, diversity, and predictors of whether the applicant will stay in Geisinger’s service area.
The program will provide full coverage of tuition and fees plus a monthly $2,000 stipend through four years of medical school.
Geisinger and Geisinger Commonwealth School of Medicine have created the Geisinger Primary Care Scholars Programthat will offer debt-free medical school and living assistance to medical students who agree to work within primary care at the health system after they graduate.
Medical students often carry $200,000 or more in debt, which pushes them into higher-paying specialties. Geisinger President and CEO Jaewon Ryu, MD, says that removing the financial strain in exchange for a four-year commitment to practice at Geisinger will make it easier for more med students to pursue primary care.
“At Geisinger, we’ve been able to prove that by focusing on primary care we can improve outcomes, lower costs and improve satisfaction among patients and providers,” Ryu said.
“We’ve built some innovative programs that expand upon the notion of what is primary care and where it is delivered. With all of these different offerings, we are thrilled to welcome anyone who shares this passion around new and exciting ways to deliver this core care,” Ryu said.
“So, it’s only natural that we extend that commitment to training the next generation of physicians. These scholars have the opportunity to learn and later work in Geisinger’s innovative primary care environment without the worry of how they will pay for their education,” he said.
The program will pick 40 first- and second-year students in each incoming medical class through a competitive application process. Selection criteria include demonstrated financial need, academic merit, diversity, passion for serving their communities, and predictors of whether the applicant is likely to stay in Geisinger’s service area.
The program will provide full coverage of tuition and fees plus a monthly $2,000 stipend through the four years of medical school.
“I can’t think of a better opportunity for these scholars to pursue their commitment to primary care than by providing debt-free medical schooling,” said Steven J. Scheinman, MD, executive vice president and chief academic officer at Geisinger and Dean of the Geisinger Commonwealth School of Medicine.
Last year Geisinger started the Abigail Geisinger Scholars Program. Which gives 10 students in each class up to four years of tuition in the form of a loan, which is forgiven upon completion of a service commitment as a Geisinger physician in any specialty.
“I CAN’T THINK OF A BETTER OPPORTUNITY FOR THESE SCHOLARS TO PURSUE THEIR COMMITMENT TO PRIMARY CARE THAN BY PROVIDING DEBT-FREE MEDICAL SCHOOLING. ”
STEVEN J. SCHEINMAN, MD, DEAN, GEISINGER COMMONWEALTH SCHOOL OF MEDICINE.
While perhaps not as controversial as it once was, the ‘conversion’ of a nonprofit hospital to a for-profit venture can raise questions and spark unhelpful rumors.
KEY TAKEAWAYS
There may be an opportunity to highlight increased revenues for the benefit of local government, since investor-owned hospitals pay taxes.
Remember: Every hospital, regardless of its tax status, must bring in more dollars than it spends in order to be financially healthy and reinvest.
In most communities, the conversion of a hospital from a not-for-profit to an investor-owned enterprise no longer stirs the heated debate that it did decades ago. Instead, you’re much more likely today to see not-for-profit and investor-owned hospital organizations working in partnership.
Renowned not-for-profit health systems such as Duke Health and the Cleveland Clinic have formed strong affiliations with investor-owned hospital companies. In these and other partnerships, not-for-profits and investor-owned organizations are working together to strengthen hospitals, invest in communities, and serve patients.
In fact, the issues facing investor-owned hospital systems during a partnership are the same as those faced by not-for-profit health systems during a partnership discussion: Local control and governance, cultural compatibility, charity care support, and commitment to local investment are leading hot buttons for both.
Still, the “conversion” of a not-for-profit to an investor-owned organization can represent a change that can raise questions and ignite unhelpful rumors.
To help you be prepared, start by answering these basic questions: What’s the difference? How are not-for-profit and for-profit (investor-owned) hospitals different from one another?
Taxes: First, a (very) broad definition: “Not-for-profit” and “for profit” are tax-related designations. A not-for-profit hospital does not pay certain taxes, including those on property used for care, income, and sales. How- ever, it usually does pay payroll and other federal employee taxes. A for- profit hospital pays property, sales, and income taxes as well as payroll taxes. Not-for-profits sometimes make payments in lieu of taxes to help offset the costs of providing important community services, such as police and fire coverage.
Capital: Not-for-profit and investor-owned hospitals are also differentiated by where they get capital to invest in their facilities for infrastructure improvements, new equipment, staff, and the like. Not-for-profit hospitals usually go to the bond market for capital. Investor-owned hospitals go to the public stock market, the bond market, or investment groups for capital.
Analysts: Now for a word about financial ratings. Both types of organizations have outsiders judging the hospital’s financial performance. To help investors monitor their portfolios and make buying and selling decisions, not-for-profits are graded by credit rating agencies, such as Moody’s Investors Services and Standard & Poor’s. Publicly traded, investor-owned hospital stocks are watched by analysts and valued daily in stock exchanges.
Ownership: Who “owns” the hospital after such a sale is an important question and can reflect a community’s concerns about having a future voice in the care provided at its hospital. The answer can be complicated and inconsistent from hospital to hospital and community to community.
Here’s an overview: Independent, not-for-profit hospitals are, in a sense, owned by the communities they serve. The boards are usually comprised of local leaders and physicians. Excess revenues—profits—are fully reinvested into the community’s care after debt payments, payroll, and other expenses. Hospitals that join a regional or national not-for-profit health system, however, may or may not have a local board with a say in the direction of the facility and may or may not share their profits with the system. (In fact, if your local hospital is in financial trouble, the money flows into your hospital, not out of it!)
Investor-owned hospitals are, as you might guess by the name, owned by investors, who can be private individuals or stockholders. Investors traditionally benefit as the value of the company’s hospitals increases over time, through effective operations and local investments, and as the company overall grows by adding more hospitals.
Adding to this complexity is the trend for hospitals to pursue joint venture partnerships where ownership is shared by two or more organizations, including the “seller.” These partnerships call for strong and trusting relationships by every party. Communications is key to success.
Familiarize yourselves with these terms and issues as you move through a partnership. Be prepared for some myth busting.
That’s where the fundamental structural differences end. The driving forces of both organizations, however, are precisely the same:
No matter your tax status, every hospital must take in more dollars than it spends to be financially healthy and to reinvest in the care it provides.
Every hospital must offer quality care, provide current medical equipment and facilities, and support a trained staff to attract (and keep) patients and serve the needs of physicians, payers, and others.
Now, consider some specific questions you may hear related to the structure of a not-for-profit to investor-owned conversion.
WHAT HAPPENS TO THE PROCEEDS OF THE SALE?
When there are funds left over from a sale, they are often referred to as the proceeds. These proceeds exist once the hospital’s debt and any other obligations (e.g., a pension fund) have been paid.
The answer as to what happens to those dollars depends on the ownership structure of the selling organization and the terms of the transaction. Here are a few scenarios:
The sale of a stand-alone, not-for-profit community hospital to an investor-owned company may lead to the creation of a community foundation. The creation of the foundation—including its board and mission—may be directed by your state attorney general’s office, and the proceeds from the sale will fund it.
When two not-for-profits merge, it is rare that there are proceeds. Instead, the common practice is for all assets from both organizations to combine for the good of the new system.
From the sale of a hospital owned by a religious organization, the remaining proceeds will likely return to that order or denomination.
When a government-owned hospital is sold, money left over may return to the city’s or county’s coffers, which may deposit it into the government’s general operating fund or create a new organization for meeting the charitable healthcare needs of the community.
WILL CHARITY CARE CONTINUE AT ITS CURRENT LEVEL?
This is really a question of community commitment and may be an indicator of how much the community-based culture is or is not going to change under the new ownership. In most cases, a commitment to either a specific level of charity care or a guarantee to continue the hospital’s existing charitable mission and policy is written into the deal documents. Expect the question and know the answer.
HOW MUCH MONEY IN LOCAL TAXES WILL THE NEW HOSPITAL OWNER PAY?
An investor-owned hospital pays taxes that benefit local government. This question is an opportunity to highlight the added contribution as a distinct benefit of investor-owned partnerships.
In many cases, the fire department, police force, schools, parks, and other community assets will benefit on an annual basis from an investor-owned partner paying state and local property and sales taxes.
One cautionary note: In some cases, new hospital owners may seek appropriate tax incentives when entering a new community and investing in a hospital. Be sure you understand the local government strategic thinking before you answer the tax question.
HENRY KOTULA 