On Monday night, Highmark executives toasted the Pennsylvania Department of Insurance’s approval of the health insurance giant’s merger with West Penn Allegheny Health System. Highmark’s plan to create an integrated delivery network including insurer and health care providers could well save the six hospitals that to date comprise the new Allegheny Health Network. 
Meanwhile, a two-hour drive northeast of Pittsburgh, Warren General Hospital is fighting to retain its tax-exempt status, and, quite possibly, its life.
There are a few ways to look at this.
- What’s happening in Warren, Pa., where the Warren County Board of Assessment Appeals ruled Warren General Hospital is subject to property taxes, is a harbinger of things to come for nonprofit hospitals across the country. We’ve talked about what hospitals need to do to prepare for this day for a long time. Now, the day is here.
- Independent community hospitals are in trouble. If they lose their tax-exempt status, it’s a wrap for them. With Medicare reimbursements being squeezed, governors across the country refusing to expand Medicaid even at the federal government’s expense and patient volumes down, in large part because of an economic downturn from which we’ve not fully recovered, community hospitals cannot survive as they exist today.
- The big systems aren’t safe from taxing bodies, either, especially when putting their property on the tax rolls, cash-strapped cities like Pittsburgh can extract millions. UPMC, for example, owns $1.6 billion in land and buildings, 86 percent of which is tax-exempt.
I was at a recent meeting of the Hospital Council of Western Pennsylvania, where tax-exempt status was a significant part of the discussion. Hospital associations are working to support Senate Bill 4, which would legislate that tax-exempt status be determined by Act 55, not by the courts, which is what is happening in Warren and where the City of Pittsburgh and UPMC are headed. These associations also are working with their members to determine how much uncompensated and charity care they provide, the bad debt they carry and the positive economic impact these hospitals have on their communities, where in most instances they are the largest employer.
Then what? A report pitched to the media? Data shared with legislators? Good tactics, but not enough.
Each community hospital needs to do a better job of telling its “capital S story” – not simply the human-interest stories of doctors providing miraculous care (though those have a place) but the Story with broad, deep context that is robust, authentic and useful. Clearly, regularly and effectively communicating community benefit in an effort to preserve tax-exempt status now must absolutely be a priority. A comprehensive strategy to tell your story includes grass-roots strategies, rallies a community and calls on the carpet elected officials like the Warren County Commissioners.
Non-profit hospitals big and small need only look to Warren, Pa. and Pittsburgh to see what their future holds. They’d be wise to take action now. See what we mean when we talk about hospitals telling their Story.
_____
Jason Snyder is a senior vice president for WordWrite Communications.
