Hospitals Provide $1.3 Billion in Uncompensated Care and $2.75 Billion in Total Community Benefit

February 17, 2016

The Missouri Hospital Association has released its annual Community Investment Report, which includes community benefit and economic impact data, and underscores hospitals’ essential role in building strong, healthy communities. The report is available to consumers on the association’s completely revised hospital data transparency site, FocusOnHospitals.com.

Missouri’s hospitals deliver significant value to the communities they serve,” said Herb B. Kuhn, MHA President and CEO. “In 2014, the state’s hospitals provided more than $1.3 billion in uncompensated care and $2.75 billion in total community benefit, while employing nearly 148,000 workers and investing $1.6 billion in capital projects.”

Providing care for those without the resources to pay is an essential part of hospitals’ community-focused mission. In 2014, the state’s hospitals provided $1.3 billion in total uncompensated care — an increase of $193 million between 2013 and 2014. Charity Care Increase

Charity care and bad debt are combined to find the total uncompensated care provided. In 2014, Missouri’s hospitals provided approximately $723 million in charity care and incurred more than $592 million in bad debt at cost. Both categories increased over the 2013 totals, with charity care increasing by $136 million and bad debt by $56 million.

“Hospitals continue to bear the cost of the state’s high uninsured rate,” Kuhn said. “In 2014, hospitals again exceeded the $1 billion mark in uncompensated care. Throughout a decade — from 2004 to 2014 — charity care cost at Missouri hospitals increased 469 percent, from $154 million to $723 million.” 2014 Community Benefit

As large as these contributions are, they are not the only way hospitals benefit the communities they serve. Hospitals also absorb the unpaid costs of treating beneficiaries of Medicare and Medicaid, help educate and train the health care workforce, offer clinic services, and donate to local causes.

Together, these investments are known as community benefit. In 2014, Missouri hospitals provided more than $2.75 billion in value to their communities when all of these investments are aggregated. Hospitals have a significant impact on Missouri’s economy.

Hospitals provide a significant financial boost to the communities they serve, where they often are the largest employer. In addition, hospitals must invest in their physical plants to ensure the highest quality care and patient satisfaction. These investments underpin the economy of cities, small and large, providing support for families and businesses throughout the state.

According to Dan Mehan, President and CEO of the Missouri Chamber of Commerce and Industry, “Hospitals have become economic anchors in communities across the state. In fact, it’s hard to overestimate the impact Missouri hospitals have on the economy.”

Mehan cited the hospital workforce and hospital’s capital investment as significant drivers of economic activity that multiply as they circulate through the economy. He also cited hospitals’ contribution to the health of the state’s workforce, saying, “How can we even begin to calculate how valuable hospitals are to having a healthy workforce in Missouri?”

2014 Hospital Economic Activity

In 2014, Missouri’s 148,000 workers had an annual payroll of $9.6 billion. Hospitals also invested more than $1.6 billion in various capital improvement projects throughout the state. These community investments help strengthen the health care system. They also ripple throughout the economy, creating household income, opportunities to build businesses and revenue for state and local government.

“Hospitals are committed to serving their communities,” Kuhn added. “This report explains the important work hospitals do to make Missouri healthier and stronger. Missourians also can find out more about their local hospital — and hospitals statewide — on Focus On Hospitals. In addition to the new community investment data, the site includes the most recent data on hospital price and quality.”