Readers respond: Non-profit hospitals the wrong target

Recently, I wrote an editorial suggesting that maybe the not-for-profit hospital model was getting outmoded. At the very least, after all, it's clear that it's getting tougher for legislators, hospital administrators, health plans and other stakeholders to agree on how to define charity care and how to make sure hospitals are held accountable for delivering it.

In making that argument, I wasn't trying to denigrate the work existing non-profits were doing--I was just acknowledging the reality that their business model is under pressure. True, some agreed with me:

"To properly evaluate the cost of healthcare, all organizations need to be financially structured the same way," one reader suggested. "All charity work should be tax deductible. Today we have a complex mess of financial structures that have no real benefit to the patient."

Others of my readers, however, thought I'd pointed my guns at the wrong target:

"A well-run, well-funded community-owned hospital is a great benefit to residents of the less populated areas of the country. The tax advantages and the ability to recycle net income from operations into improvements and modernization allow us to offer services and a level of quality that is normally reserved for facilities in more populous areas," said one non-profit hospital trustee from the southern U.S. 

He said that the trend for physician groups and for-profit entities to build freestanding ambulatory surgical centers and other entities that compete with hospitals is the real problem policymakers and analysts should be addressing. "Some mechanism to limit the piracy of profitable services away from not-for-profit community hospitals is critical," he said.

Of course, charity care is a complex issue. And let's face it: it's unlikely people are going to agree on changes to the non-profit system, even if everyone agreed that some type of change should be made.

Regardless, I do think this is a good time to have a vigorous discussion on the subject, with a newly-minted Congress in place, a new president on the way and spring in the air. We simply can't afford to assume that what worked yesterday will work tomorrow, especially when presented with such an opportunity for change. Let's see what we can come up, OK? - Anne