Residents of Pueblo, Colorado are raising concerns about the lack of charity care provided by their local nonprofit hospitals, Parkview Medical Center and Centura St. Mary-Corwin. These hospitals receive millions of dollars in tax breaks but are not using that money to provide adequate free care to those in need. While the hospitals report significant community benefit spending, experts argue that the majority of that money is not being directed towards creating real community benefits, such as charity care.
In response to these concerns, four U.S. senators have called on the Treasury’s inspector general and the IRS to evaluate nonprofit hospitals’ compliance with tax-exempt requirements. According to data from Johns Hopkins University, the average hospital in the U.S. spends only 1.9% of its operating expenses on charity care. In comparison, Parkview provided just 0.75% of its operating expenses on free care, amounting to approximately $4.2 million.
Centura Health, a chain of tax-exempt hospitals that includes St. Mary-Corwin, does not provide specific numbers for individual hospitals but reports its community benefit spending to the federal government in aggregate. St. Mary-Corwin reported $2.3 million in charity care in the fiscal year 2022. However, community activists claim that the hospital has shut down most of its services except for cancer care, suggesting that the hospital prioritizes profit over providing essential services to the community.
The lack of charity care provided by these hospitals has resulted in increased medical debt for low-income residents. In Pueblo County, 15% of people have medical debt in collections, compared to the statewide average of 11%. People of color are particularly affected by these high levels of medical debt. Activists in Pueblo are organizing to hold the hospitals accountable for their community benefit spending and ensure that they address the needs identified by the community, such as housing, addiction treatment, behavioral health care, and youth activities.
The spending reports from Parkview and St. Mary-Corwin reveal a disconnect between the hospitals’ priorities and the community’s health needs. Parkview reported spending a significant portion of its community benefit funds on Medicaid shortfall and medical staff education, while only allocating a small amount to community health improvement projects. The hospital recently invested millions in a new orthopedic facility and cancer center. Similarly, St. Mary-Corwin allocated a large portion of its funds to Medicaid shortfall and medical staff education, with only a small portion going towards community health improvement projects.
Representatives from the hospitals declined to provide detailed information about their charity care spending. They emphasized their commitment to providing extensive charity care but failed to address the specific concerns raised by the community. Activists in Pueblo are calling for greater transparency and accountability from the hospitals regarding their community benefit spending.
Tax-exempt hospitals have faced increased scrutiny in recent years, especially as the uninsured rate has decreased due to the Affordable Care Act and Medicaid expansion. This has led to a reduction in the amount of care hospitals are required to provide without payment, potentially freeing up funds that could be used to help those without insurance or with high-deductible plans. In Colorado, both charity care spending and bad debt write-offs have decreased significantly since the implementation of these healthcare reforms.
The residents of Pueblo are determined to have their voices heard and ensure that the hospitals in their community prioritize the needs of the people they serve. They are conducting research, attending public meetings, and advocating for representation on hospital and state boards that influence community benefit spending. Their goal is to create positive change and ensure that community benefit dollars are used effectively to address the pressing health needs of their community.
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