Community Benefit Trends Healthcare Leaders Should Know

By Kim L. Scifres, CPA, and Rachel Spurlock, CPA
| 2/5/2019
The healthcare industry has seen a significant shift in how hospital management teams, in collaboration with hospital executives and board members, approach community health. As not-for-profit hospitals head into their third cycle of community health needs assessments (CHNAs) to comply with Section 501(r) of the Internal Revenue Code, they are more strategically prioritizing resources, integrating with community partners, and focusing on social determinants of health.

These innovative strategies maximize the community health benefits that hospitals provide and help hospitals more effectively meet the needs of vulnerable and underserved populations. The third cycle of CHNAs also presents hospitals with an opportunity to strengthen the overall impact of their community benefit programs. 
 
The following are three community benefit trends seen in leading healthcare organizations: 

1. Focusing on fewer issues and prioritizing resources
Many hospitals currently are focusing on fewer community benefit activities, instead strategically prioritizing their resources to achieve the biggest impact on specific issues.

Hospitals have learned from the previous two CHNA cycles, conducted in 2013 and 2016, which strategies have had the most positive impact on their communities. In response, they are choosing to direct resources to a smaller number of community benefit priorities – perhaps three to five versus the eight to 10 they may have focused on in prior years. They also are being more intentional in selecting partner organizations. Hospitals anticipate that by targeting programs, resources, and community partnerships toward specific health needs, they will achieve a more sustainable, positive impact in the community. 

2. Integrating community partners
As hospitals expand community health beyond their physical walls and campuses, community partners have become an important part of that mission. These partners are integrated with the hospital’s community benefit activities, work closely with hospital personnel, and sometimes even lead community health efforts.

Building dynamic partnerships among hospitals, community health centers, local health departments, and other partners results in a highly effective, coordinated, and strategic approach to promoting healthy communities. For example, primary and secondary schools often are partners in addressing obesity and improving the availability of health screening services within communities. 

3. Increasing focus on social determinants of health
It is estimated that 40 percent of an individual’s health outcome is shaped by social and economic factors such as education, income, employment, community safety, and family and social support.1 Organizations are able to better address health conditions and outcomes by first assessing the underlying factors of their community members’ health needs. A recent study found that hospitals significantly reduce spending when they connect their patients to services within the community that addressed social determinants of health, such as housing, transportation, access to healthy food, and financial assistance.2

In addition, many hospitals are adopting anchor institution strategies of investing in and supporting their local communities to improve community health. Some examples include developing innovative programs aimed at providing safe and affordable housing, supporting minority-owned and local businesses by “buying local,” and conducting job training and development programs. Hospitals also can adopt anchor institution strategies by providing low-interest loan programs for not-for-profit organizations that support community development efforts. 

Strengthening community benefit programs
Healthcare organizations must challenge themselves to thoroughly assess their communities’ needs and then work strategically and collaboratively to address each one. As hospitals work to prepare their 2019 CHNAs, they may want to assess community benefit programs and determine the best opportunities to make investments in community health. These are some strategies to consider:
  • Ensure the hospital’s prior CHNA report meets the requirements of Section 501(r). For more information, see the Crowe article, “A Community Health Needs Assessment Checklist.”
  • Review the hospital’s implementation strategy and document actions taken since the prior CHNA. Conduct the review early in the third year of the implementation strategy cycle to be sure the hospital is on track to meet its goals. Document quantifiable investments in community benefit programs for the three-year period.
  • Assess the effectiveness and accuracy of the hospital’s current community benefit reporting system, and consider how the CHNA process affects planning.
  • Consider meeting with other stakeholders to discuss a community vision focusing on health.
  • Evaluate whether changes should be made to the hospital’s CHNA process. Changes might include identifying opportunities to collaborate with additional community partners (even other hospitals), including additional data and input related to social determinants of health on the CHNA report, and incorporating hospital data captured in electronic medical records. 

 

1 “County Health Rankings Model,” University of Wisconsin Population Health Institute, School of Medicine and Public Health, March 29, 2016, http://www.countyhealthrankings.org/county-health-rankings-model

2 Zachary Pruitt, Nnadozie Emechebe, Troy Quast, Pamme Taylor, and Kristopher Bryant, “Expenditure Reductions Associated With a Social Service Referral Program,” Population Health Management, April 17, 2018, http://doi.org/10.1089/pop.2017.0199

 
 

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Kim Scifres
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Rachel Spurlock
Partner, Healthcare Tax Services Leader