Friday, September 27, 2024

Nonprofit hospitals and their big breaks

Presented by UnitedHealth Group: The ideas and innovators shaping health care
Sep 27, 2024 View in browser
 
Future Pulse

By Daniel Payne, Erin Schumaker, Carmen Paun and Ruth Reader

Presented by 

UnitedHealth Group
FOLLOW THE MONEY

LONDON, ENGLAND - SEPTEMBER 12: A woman waits outside the Accident and Emergency entrance to the Royal London Hospital on September 12, 2024 in London, England. Keir Starmer commissioned surgeon and former health minister Lord Darzi to review the state of the NHS for a report published today. Starmer says the NHS is broken but not beaten as he commits to a ten-year plan to get the   NHS fit for the future. (Photo by Carl Court/Getty Images)

Governments give big breaks to nonprofit hospitals. | Getty Images

Nearly 3,000 hospitals received more than $37 billion in tax benefits in 2021 because of their nonprofit status, researchers from Texas Christian University and Johns Hopkins Bloomberg School of Public Health found in a new analysis published in JAMA.

Some politicians have questioned whether the public is getting enough bang for its buck.

More than half of the benefits come from state and local taxes, largely through breaks on sales, property and income levies, the researchers found — leading to meaningful differences depending on the location of a health system.

Seven percent of the hospitals in the study accounted for half of the money.

Researchers suggested that, because the tax breaks are mostly not federal, state and local governments should do more to ensure hospitals fulfill their nonprofit missions.

Even so: Researchers acknowledged that, should governments move to raise taxes on nonprofit hospitals, the hospitals might employ strategies to reduce their liability. So the revenue could be smaller than expected.

The American Hospital Association offers another perspective: In a report from EY, a consulting firm, prepared for the hospital trade group, nonprofit hospitals look well worth their tax-advantaged status. The study found they provided benefits valued at $129 billion to communities they serve, far more than they got in tax breaks.

Why it matters: Some lawmakers are interested in scrutinizing what communities are getting for the breaks they give hospitals.

Bernie Sanders (I-Vt.), chair of the Senate committee in charge of health policy, for instance, released a report last year arguing hospitals prioritized paying big salaries for their executives over patient needs. He has called on new measures to hold health systems accountable for the breaks they get.

Lawmakers’ views of how much hospitals are giving or taking from the health economy could also spur legislation on issues like transparency requirements and billing rules.

 

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WELCOME TO FUTURE PULSE

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This is where we explore the ideas and innovators shaping health care.

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Share any thoughts, news, tips and feedback with Carmen Paun at cpaun@politico.com, Daniel Payne at dpayne@politico.com, Ruth Reader at rreader@politico.com, or Erin Schumaker at eschumaker@politico.com.

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AROUND THE AGENCIES

WASHINGTON, DC - JULY 4: First Lady Jill Biden speaks during a 4th of July event on the South Lawn of the White House on July 4, 2024 in Washington, DC. The President and First Lady are hosting the Independence Day event for members of the military and their families. (Photo by Samuel Corum/Getty Images)

Jill Biden touted funding for women's health research this week. | Getty Images

The Department of Defense is committing $500 million a year toward women's health research, mainly through Congressionally Directed Medical Research Programs, which Congress created in 1992 to manage military biomedical research.

First Lady Jill Biden announced the outlay at the Clinton Global Initiative annual meeting this week.

In addition to funding research into conditions that affect women disproportionately or differently than men, like ovarian cancer, rheumatoid arthritis and musculoskeletal injuries, the DOD is adopting a new policy to ensure women's health is taken into account during every step of the military’s research process.

Why it matters: Women, especially women of color, have long been underrepresented in clinical trials. That means many drugs and treatments aren’t developed with women in mind, and some are less effective and safe for women.

Women are also more likely to be misdiagnosed or go undiagnosed.

The backstory: The announcement of the DOD funding follows President Joe Biden's March executive order on advancing women's health research.

The Advanced Research Projects Agency for Health, the National Institutes of Health, the Department of Health and Human Services, the National Science Foundation and the Department of Veterans Affairs have also announced women's health research-focused initiatives, including on perimenopause and menopause, endometriosis, mental health and substance use.

 

A message from UnitedHealth Group:

UnitedHealth Group has been deploying artificial intelligence (AI) and machine learning (ML) applications at-scale for years. Now, improvements in data and processing power are enabling more impactful uses of AI/ML, ushering in new possibilities for patients, providers, and the overall health care system. Learn More.

 
WORLDVIEW

 Tray filled with pink pills in a factory environment

The need for new antibiotics is great. | Shutterstock

World leaders have taken another stab at combating a major public health threat, which is only expected to get worse: a lack of effective antibiotics.

Diplomats at the UN General Assembly agreed Thursday to establish a new panel to produce scientific evidence on bacteria that resists antibiotic treatment, raise $100m for developing countries, and strive to reduce antibiotic use in farming – overuse of antibiotics is linked to the drugs’ increasing ineffectiveness.

They will also aim to reduce deaths associated with antimicrobial resistance by 10 percent by 2030, our Rory O’Neill reports.

The backstory: Antimicrobial resistance, which occurs when bacteria, fungi or viruses become resistant to drugs, kills up to 1 million people each year, with that figure set to rise as high as 1.91 million a year by 2050.

Many who work in public health advocacy were hoping for firmer commitments to combat the problem, speed new treatments, and ensure they’re available worldwide.

But negotiators were hampered by divisions over financing, obligations on the pharmaceutical and agricultural industries, and the sharing of new technology and drugs.

Critics abound: Given the scale of the problem, the document “should have been much more concrete and ambitious,” Christos Christou, international president of Doctors Without Borders, said in a statement.

Any hopes the declaration would significantly change the status quo dissipated as drafts emerged, Jaume Vidal, senior policy adviser at Health Action International, told POLITICO.

An earlier draft committed to a specific cut in the use of antibiotics in farm animals: 30 percent by 2030, and an end to the use of the most essential antibiotics in animals altogether. The final declaration only pledges to try to reduce their use.

Activists such as those at the Third World Network said they were also alarmed at language that only commits nations to “voluntary” sharing of drugs, even when they’re developed with the aid of public funds.

What’s next? America’s Advanced Research Projects Agency for Health announced up to $27 million in funding for a project that will use artificial intelligence to speed the development of new antibiotics.

 

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