Tax-Exempt Hospitals Provided Nearly $130 Billion in Total Benefits to Their Communities

WASHINGTON (October 10, 2023) – Even in the face of a once-in-a-century pandemic, all hospitals, regardless of ownership type, continued to provide a comprehensive range of benefits, programs and essential services to their communities. New analysis released today by the American Hospital Association (AHA) shows that tax-exempt hospitals provided more than $129 billion in total benefits to their communities in 2020 alone; the most recent year for which comprehensive data is available. The analysis calculates that tax-exempt hospitals’ and health systems’ total community benefits were 15.5% of their total expenses in 2020, based on data from the Internal Revenue Service.

This report demonstrates that hospitals never retrenched during the pandemic, and, in fact, the amount of community benefit exceeded the prior year by nearly $20 billion due to the field’s commitment to their communities.   

Nearly 7% of not-for-profit hospitals’ total expenses — amounting to $57 billion — was attributed to financial assistance for patients and underpayments from Medicaid and other means-tested government program. A 2022 report from the international accounting firm EY demonstrates that for every dollar invested in non-profit hospitals and health systems through the federal tax exemption, an impressive $9 in benefits is delivered back to communities.

“This report reaffirms that hospitals and health systems play an unparalleled role within the health care sector, serving as vital pillars in promoting the health and well-being of their communities,” said AHA President and CEO Rick Pollack. “Particularly commendable is the manner in which hospitals responded to the challenges posed by the pandemic, intensifying their commitment to delivering essential care, services and programs necessary to confront this historic crisis.”

Hospitals are committed to ensuring access to care is available to all who need it, regardless of ability to pay, while also working to address the greatest health challenges within specific communities, particularly medically underserved, low-income and minority populations. As part of that commitment, hospitals strive to assure low-income patients have regular access to care through programs like Medicaid, which helps provide the routine and preventative care so important for health and wellness.

Hospitals report on community benefit activities, which include financial assistance for those in need, as well as a wide range of programs and services designed to meet the current and future health needs of all they serve. In addition, hospitals and health systems support emergency preparedness for all types of disasters; education, research and training for the next generation of caregivers; clinics for underserved communities; as well as a wide range of tailored programs aimed at keeping their communities healthy and productive.

For the full analysis visit HERE and for more information on how the hospital field is benefiting their communities visit HERE.

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Contact:    Ben Teicher, bteicher@aha.org
                  Sharon Cohen, scohen@aha.org